If you’re running a business in a highly skilled sector, managing your business’s finances effectively is vital to making your company successful.
We live in an era of rapid change affecting virtually all professional services businesses and client expectations have evolved accordingly. “Clients now expect more value, high quality of work, and a faster delivery of solutions and services,” warns the summary of an extensive survey of professional services executives commissioned jointly by the market research firm Research Now and professional services firm Mavenlink [1].
“Clients are also asking for transparency and accountability in work delivered.”
Entrepreneurs and companies operating within highly skilled sectors of the workforce need to bring not only honed, competitive expertise to the table, but also financial strategies closely tailored to the needs of the business and client base alike.
What follows are eight simple pieces of actionable advice for taking your organisations finances to the next, best level:
Create a good budgeting/accounting system
Tracking cashflow is a foundational task for any business. QuickBooks, FreshBooks and AccountEdge Pro can revolutionise your process while instantly providing both big picture and granular views of your business finances so you can direct resources and attention where it’s needed most.
Don’t spend big too soon
Yes, you need to invest in growth. But splashing out on a huge marketing campaign won’t help you if it depletes your cash reserves. Wait until you have a good cushion or you’re better established before you take bigger financial risks.
Use outside help when necessary
No one is an expert in every area. If, for example, bookkeeping or accounting isn’t in your wheelhouse, hire someone with the skill set to get the job done. If a part- or full-time employee isn’t needed, you can hire a consultant or freelancer.
Get on top of invoicing
Business may be booming, but if you aren’t collecting the money owed to you cashflow—and, thus, your ability to capitalise on the success and appropriately respond to challenges—will be compromised. Invoice promptly for your services. If you’re plagued by late payers, offer an incentive for paying quickly, such as a discount on the bill.
Pay promptly
Take as much time as you can to pay your bills to keep more cash on hand but don’t miss deadlines. American Express® Business Cards can give you up to 54 day payment terms giving you more time and therefore maximising your cashflow¹.
Apply for a loan before you need it
Cash is king and having plenty of it can be key to building a successful business. If there’s a chance you may need extra capital in the future, apply for it while you’re still flush—you’ve got a better chance of being approved when you’re in the best shape.
Keep separate business accounts
A separate checking account is a useful way to keep all your business transactions in one place. If you’re going to charge business expenses, a separate business charge card is also helpful. With American Express you can get up to 99 supplementary Cards for your team helping you consolidate all business expenditure under one Account so you'll be able to see exactly where your money is going on your monthly statement.
Measure your performance
Are you doing better than last year? Knowledge is power, so tracking and comparing current results with previous results can shine a light on your strengths and weaknesses— and help you set newer, bigger goals for the future.
Learn more about how your professional service business could benefit from an American Express® Business Card.
[1] Three major trends disrupting the professional services industry Consultancy UK; https://www.consultancy.uk/news/16209/three-major-trends-disrupting-the-professional-services-industry
- The maximum payment period on purchases is 54 calendar days on Gold & Platinum Business Charge Cards and 42 calendar days on the Basic Business Charge Card, it is obtained only if you spend on the first day of the new statement period and repay the balance in full on the due date.
- If you'd prefer a Card with no annual fee, rewards or other features, an alternative option is available – the Business Basic Card.
