The No. 1 reason businesses fail… and how you can avoid it
Don’t you just hate the old cliché, cash is king. I do.
But the fact is, running out of cash is the number one reason businesses fail. Despite the fact that very often they are profitable. But profit and cash is not the same thing.
So how do you protect yourself?
There are really two critical things you need to get right:
1. Keeping your finger on the pulse of your business, and
2. Collecting money fast.
So let’s look at each of those and how we can use modern technology to our advantage.
Your future is at stake
Better financial information helps you to make better business decisions. But it’s more important than that. We’ve seen many businesses fail through lack of financial information. Very often businesses run out of cash. They thought they had a profitable business, but suddenly they can’t meet the payroll at the end of the month.
Having the right numbers at your fingertips will give you an early warning system if things are not going so well.
What you need is an accounting system that gives you 24/7 access to up-to-date financial information and reports. And that’s where cloud-based software comes in. With a modern cloud accounting system you can access your financial data in real time from any device with an Internet connection.
Quicker cash collection
A modern cloud accounting system gives you fast, simple customised sales invoicing that will make your life simpler. And the facility for emailing of invoices, with the option to attach a statement at the same time makes it so easy to manage your sales and get paid quicker.
Even better, it allows you to embody payment methods into your invoicing. For example, click and pay to drive quick collection of your debts. It makes it so much easier for you to get paid, reducing bad debts and slow payers and putting more cash in your bank account.
You can also chase debtors whilst you’re on the go.
If you want to minimize the risk of running out of cash moving to a cloud accounting system is an important step to take.
Paddy Gahan Gahan.ie Xero Cloud Accountants