Starting your very own small business is an exciting yet
daunting venture. You’re chasing your dream – leaving everything else
behind to do what you’ve always wanted to do, the way you envision it
should be done. On the other hand, you’re putting it all on the line.
You’re risking not only your career but your entire livelihood. The success or failure of your business will have a direct impact on the entirety of your life.
According to the U.S Small Business Association Office of Advocacy, about a third of businesses fail in their first two years of operation and about half fail within the first five years.
Poor financial management is one of the main reasons businesses go
under. When resources are tight it is easy for ambitious entrepreneurs
to overspend, believing that profitability is right around the corner.
There is really no excuse for not staying on top of your
finances in this day and age. There are a number of financial tools that
are now easier to use and more accessible since becoming readily
available in the cloud. The following list highlights the types of
web-based software all small business owners should use in order to
achieve financial success.
#1. Accounting
Cloud accounting software is the best way to keep track of
your business cash flow. It provides owners and their accountants both
high-level and detailed views of their current financial situation, in
real-time. Many solutions connect with their user’s bank accounts,
allowing bank transactions to be fed directly into the ledger,
eliminating the need for manual data entry.
What sets cloud accounting software apart from its desktop
predecessors is that it is accessible anytime, anywhere. This not only
makes it easy for business owners to check their finances on the go, but
also lets accountants access their client’s books whenever it’s
convenient. The accessibility factor makes for greater collaboration
between both parties and really gives accountants the ability to act as
trusted financial advisors that monitor the financial well-being of
their client’s business.
#2. Payroll
Traditionally, running payroll was a burden that reoccurred
every two weeks or so for small business owners. Thanks to the new
features made possible by payroll in the cloud, this is no longer the
case. Many payroll software vendors provide an employee app, where staff
can log in and request time off and access paystubs without having the
ability to view the greater financial data.
The payroll manager can set PTO rules and let the software
automatically track accruals. The ability to have the entire company
take part in payroll removes much of the hassle for the person who
ultimately processes it.
In addition to the employee app, features like automatic
tax calculations and filing, API integration and comprehensive reporting
are now commonplace for online payroll software.
#3. Expensing
Passing along a pile of paper receipts attached to an
expense report has no place in the digital age we now live in. There are
numerous applications that make expense reporting quick and easy. Like
cloud accounting solutions, web-based expensing software can link with
online bank and credit card accounts, allowing for transactions to be
automatically imported into an expense report.
Many solutions also offer mobile apps that make it simple
to track and automate expenses while employees are on the road, spending
money. For instance, miles traveled can be tracked using mobile GPS
capabilities and expense items can be imported via a photo of a receipt.
#4. Invoicing
Creating, sending and keeping track of invoices is now much
more efficient than it once was. Good cloud invoicing software lets
users create an invoice, send it from the application and monitor when
the client has viewed it. This makes it easy for small business owners
to keep a close eye on how outstanding invoices are affecting their
cashflow and determine when it is the proper time to follow up with the
customer.
Invoicing software often has the capability to pre-load
inventory items and their cost and upload company logos. This makes
generating an accurate and branded invoice a task that can be
accomplished in only a few clicks.
#5. Time tracking
Accurately tracking the number of hours spent on a client
project is an absolute must for service-oriented businesses. Not long
ago it was easy to lose track of hours, leading to imprecise invoices
and questions from the client. Luckily this is no longer the case thanks
to the emergence of online time tracking software.
Contractors, freelancers and other service providers can
track the time they spend on particular projects by using web or mobile
timers, which automatically import the total hours into a timesheet. The
project manager can keep tabs on overall progress by tracking the hours
of each team member, ensuring everyone stays on schedule and budget.
As much as the cloud has expanded the capabilities of each
of the financial management tools mentioned, its greatest achievement is
that it lets all of them interact and share information. Accounting
ledgers can be updated automatically with external invoices, pay runs
and expenses. Timesheets can be imported into your invoicing software.
Approved expenses can flow into payroll software. Using the cloud, small
business owners can build a custom total business solution that meets
all their needs and gives them a comprehensive and accessible view of
their financial health.