The prospect of being your own boss is as attractive as ever. Whether the goal is to build an empire around a great idea, fulfill entrepreneurial ambitions, become your own boss or simply downshift, thousands of people choose to strike out in business on their own every year. But securing financial backing is just one of a host of worries for the small business owner.- accounting challenges
Starting your own business can present some interesting challenges. We recently asked our customer base to tell us about the major hurdles they faced when starting out and found some common concerns emerged. The results made for interesting reading:
- Raising finances- accounting challenges
Raising adequate funds to finance a business is one of the most important, but yet one of the most difficult hurdles faced by any budding small business owner. The key here is to think professionally. For example, if you are going to the bank to secure a loan, take along a professional record of accounts.
Also, be aware that the true measure of success is cash flow. Sound records will help keep track of available finances and plan for the future.
- Lack of accounting knowledge
It is unusual for small business owners to have an accounting background which is often a cause for concern, given that failing to keep records up to date can seriously impact the survival of a business. However, there are easy-to-use software that will take the pain of accounting away from the business owner, leaving you time to focus on running and growing your business.
- Planning for future growth
Many small business owners want to grow their business, however, as it expands, the basic needs of the business may change. This is particularly true in relation to small business accounting and inventory software and I would advise that small business owner consider the future growth of their company before investing in new technology. Software should be easily scalable and have a clear upgrade path so that it can easily accommodate changes as your business grows.
- Lack of technical knowledge
It is necessary to embrace new technology in order to make the most of your business, yet many people struggle in this area. There are easy courses available to get you on track and also many vendors will offer support from their team of experts to keep you on track and out of trouble.
- Training and consultancy
This is a simple question of who do you turn to for help. Starting out on your own can be a lonely journey and I would encourage small business owners to seek out professional support. Many accountants specialize in providing such value-add services and can add significant value to a small business.
- Changes in government legislation
Small businesses can often be unaware of government incentive schemes that can be of benefit to them. Take for example the PAYE online filing (payroll year-end reports) in the UK offers an incentive scheme. However, most small businesses in the UK were still unaware of the cash-back incentive for filing PAYE returns online two months before the deadline. Small business owners should use the services of their accountants to keep up to date with changing legislation.