Things to consider based on your business type.
When I first started my business I didn't really understand the nuances of business finances. I made the mistake of assuming it would be pretty much the same for everybody. But over time working with almost a hundred different clients, both for-profit and non-profit we've come to realize that different types of businesses have different needs in their business finances and their bookkeeping. There's different considerations, different ways of setting things up, and different outcomes that they're working towards. Over the next month we're going to spend some time talking about things that different business types need to be looking at in their business finances and bookkeeping and how you can customize your own books to meet your needs. Here are just a few examples of what we're going to be looking at.
Retail/Wholesale businesses:
You often have a lot more overhead than service-based businesses. This means you need to think about cash flow in different ways.
Inventory can affect your cash flow and your taxes and so you need to understand how that works in order to make good choices
With supply chain issues in the last few years, you also need to take into consideration where you're getting materials from and potentially having backups for some of those vendors
Professional service businesses:
Pricing can be a huge issue especially when you first start out. Understanding what your costs are and how to value your time and expertise will set you up well
You also need to think about your agreements in regards to scope of work with clients and scope of work with your subcontractors. It’s important to find a balance between making sure everyone is getting value while not being taken advantage of.
Non-profit corporations:
You often have much more detailed needs around income and expenses and setting your chart of accounts up well for this will save you so much headache later.
Grant management and tracking is also a huge issue. Making sure that you have systems in place before you need them makes a huge difference.
Non-profit board members are often uncertain what their actual role is around the organizational finances. Having a clear board job description and committee overviews will help people to understand how board members and staff members work together.
As we go through this month, hopefully you will glean a few gems that you can take back to your own businesses or organizations to make your finances better and more manageable. As the days get longer and the sunshine starts to peek out a little more often here in Missoula, it's a good time to start thinking about new beginnings and starting off on the right foot. Happy spring everyone!
Ever wonder what happens if you don’t file your taxes?
Everyone would probably guess that you would be subject to fines, penalties and back taxes. But did you know that if you continue to ignore the problem, that the IRS can levy the assets of businesses? If you fail to pay on time or pay in full, the IRS may seize company equipment, cars and even your business property itself.
Still looking for a tax professional? Go here to find a list of people we trust.
