How to drive success for your small business
Small businesses represent more than 90% of all companies globally. They make up the backbone of the global economy - but also shape the communities we live in, provide jobs and create a unique offering that the big boys just can't replicate. While small businesses in the past were used to a “do it yourself” mentality of managing all aspects of their business, embracing a “do it together” approach by partnering with an accounting professional can really help add a competitive edge. A Xero commissioned study conducted by Forrester Consulting revealed only 26% of small business owners consulted trusted advisors like accountants or bookkeepers to help maintain cash flow, make predictions and take proactive steps to help their financial situation.
In fact, the findings showed that those who thrived throughout the pandemic took advantage of such opportunities. Here are three reasons why small businesses can drive success by working alongside an accountant that not only looks backwards but looks to the future to help your business grow.:
Build financial resiliency Cash flow is the lifeline of any small business.
A report from JP Morgan reveals half of small businesses hold a cash buffer of less than one month and 25% of small businesses hold fewer than thirteen cash buffer days in reserve. While many small business owners don’t have a strong understanding of their current cash position, partnering with a trusted advisor can make a big difference to your business's survival. Advisors can help you prepare a cash flow forecast or understand different scenarios for your business, which plays a big part in how you can weather a crisis. Having this level of control helps your chances of success being able to pivot and take action well head.
Get your back office organised The Forrester Consulting study also found that 49% of business owners are now using cloud technology up from 32% in 2019.
This is especially critical now as many small businesses need to get accounting records up-to-date and accurate to understand how their business is doing and to make any changes. Accountants can help you make this transition and develop efficient workflows so you’ll always have a real-time, clear view of your business’ financial health. When using cloud-based accounting, labour-intensive tasks become automated or streamlined, saving you time so you can focus on running your business. Better business advisory The guidance of a trusted advisor can help you make the best possible decisions for your business. For instance, a retail business can leverage apps to support logistics, point of sale, inventory, customer service and more, so it all integrates within their accounting platform and provides a holistic view of their business operations. By going beyond the basics of number crunching, your accountant can provide customised advice for your small business and play a critical role in helping you operate successfully. Purple Accounts has in house business development and coaching services in addition to specialist services to help with cash flow, forecasting and budgeting. Arrange a chat today so we can best help you and your small business. Purple Accounts is a Xero Gold Champion Partner and includes XERO software in your accountancy package.