Finance for Small Business

Financial planification for Small Business

When you first start your business you mostly just want to focus on your craft and the last thing you want to think about finance for Small Business. I get that, as it’s not the most exciting thing to think about! In fact, 42% of people avoid the subject of finance because they don’t like talking about it or don’t understand it.
BUT it is a necessary evil, especially when the time comes that you want to access finance to grow your business.


Stay on top of things

Try to allocate some time each week for bookkeeping, even if it is just a couple of hours.
Not only will this allow you to stay organized, it will save you a lot of time and even money come tax time when you are preparing things for your Accountant.


The impacts of new or additional credit

The decisions you make today with regards to taking on more debt such as another credit card, car loan or even AfterPay could impact your serviceability and borrowing capacity for tomorrow when it counts most. Reach out to your small business finance specialist before taking on extra debt, especially if you are planning to access finance down the track as part of your business growth strategy.


Cash is King

Depending on the type of business you run and how you get paid will depend on whether you accept cash as a payment method. Cash is great but remember to always put it through the books because if you forget it will impact your declared annual net income which in turn could impact your borrowing capacity.


How big are you thinking?

Is your goal to have a factory or shop of your own to run your business from? Great, dream big I say. If you are wanting to purchase your own piece of a commercial real estate here are just a few quick tips to keep in mind:
* Commercial loans usually only go up to 75% LVR (loan to value ratio) so you’ll need a minimum of 25% savings
* Stamp duty and other fees and charges will be applicable
* You may have to pay GST, especially if you are considering purchasing as a vacant possession (your Accountant can help you with these decisions)

Ready to get organized and get on top of your finances? Get in touch with your small
business finance specialist to see where she can help.

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