In our past two posts we've discussed expense policy and how to negotiate discounts for your business travelers. Here, we'll talk about client entertainment.

Often most outlandish expenses come from entertaining clients. We've all heard a story or two about somebody ordering a really expensive bottle of wine or dining at the fanciest restaurant in town (with the price tag to match). But, how do you decline to pay those expenses when they won over a new client, or kept an old client from leaving?

I don't think there is an industry which has not been affected by our current financial turmoil. Companies everywhere are tightening their belts, and every department is pitching in to help. Your business travelers should be no different.

Take this time of belt tightening as an opportunity to talk to all of your business travelers. Whether through a PowerPoint presentation, video, or just a chat on the phone - you need to convey that the business needs their help to stay competitive in these tough times. Explain to them that every dollar saved in expenses is like earning $10 more dollars in sales (this is just an example - your numbers may be very different). And, reiterate what's already in your expense policy.

A great way to get your travelers on board is to give them the tools to make it work. The Michelin Guide is an excellent resource. Every restaurant listed has merit, and many are not only yummy and stylish, but inexpensive too. Other favorite places to find great restaurants are zagat.com and opentable.com (they have a new app for the iPhone, which is fantastic).

Client entertainment isn't going away, so you will need to give your team the tools and encouragement to keep it in check.

Labels: Budgeting, Finance Tips, Travel Expenses

In our last post we discussed establishing and enforcing an expense policy. Here we'll look at how to negotiate discounts for travelers.

Most hotel chains, rental car companies and airlines offer discounts negotiated on a company wide basis. This will take some leg work, but will pay off. Here's an example of how to negotiate to get the best deal at hotels.

• Review the last 6 - 12 months of expense reports and determine the top three hotel chains where your employees stayed (be sure to note how many room nights for each hotel).
• Determine where most of your business travel takes your employees and overlay that with a map of each hotel chain.
• Contact your top three hotel chains and talk to them about your needs, your past usage of their hotels versus their competitors (give numbers), and make sure they know that you are going to choose one chain for all of your future business. If you don't have a lot of room nights, don't worry - most will still offer you a discount.
• Once you've collected the bids you'll need to do some online research. Check out travel sites, like travelocity.com or orbitz.com and compare your bid to what is being offered online. Also check out the hotel's own website and look at their special rates and discounts. The bid you received from the hotel should be below what you find online. If it's not, call them and try to talk them down.
• Choose the hotel which offers a good discount (not necessarily the best), but also takes into account their locations and convenience for your business travelers.

Be sure all your business travelers sign up for the hotel's rewards program, and let them know that they can use those rewards points any way they like. This way your employees will be incentivized to use the preferred hotel.

Of course, there will be occasions when the preferred hotel chain does not have a unit near where your business travel takes you. This is where your expense policy comes into play. Make sure that you have a clear policy that states what the procedure is when the preferred hotel is not available.

Negotiating better rates is not only good for business, it's extremely gratifying. So, enjoy!

Labels: Budgeting, Finance Tips, Travel Expenses

They are your face to your customers. They're funny, and nice, and work their tails off to make your company a success. But, man-oh-man can they spend money!

Business travelers can wreak havoc on your budget and drive up your cost of goods sold. Over the next few entries we'll discuss a few easy steps to help you keep spending in check.

If you don't have a written expense policy, write one. If you have an expense policy, and are finding that employees ignore it you need to review it and make changes. One of the easiest ways to make sure your expense policies are adhered to is to have employees sign a document stating that they have read and understand the policy, promise to adhere to it, and recognize if they don't they will face consequences (i.e. non-reimbursement, curtailed travel, reduction in bonus, or even termination).

We have an expense policy template that can get you started or give you a few ideas to improve the one you already have. Click%20here%20to%20download%20the%20expense%20policy%20template.

Labels: Budgeting, Finance Tips, Per Diems, Travel Expenses

Figuring out a budget is as necessary as it can be annoying. Some fixed costs are easy and other elements, such as sales numbers, can require a crystal ball. Yet without a budget, even the most profitable business can mismanage funds and fail. A successful budgeting process is one that creates an effective plan requiring the least amount of time spent.

The first step in creating a successful budget is realizing why some budgets fail. Inaccurate forecasting, whether done out of misinformation or desire for personal gains, can stymie any budget process. Harvard’s business school’s publication, Working Knowledge http://hbswk.hbs.edu/item/2647.html, has a great article explaining how this can happen.

This inaccurate forecasting doesn’t have to happen in the first place, and if it does, it can be fixed. A budget that has room for adjustment as the year goes along is more likely to be useful than one that is static. There will be unexpected costs but they can be factored in, as seen in the example of the San Diego Zoo used by CFO.com http://www.cfo.com/printable/article.cfm/4124788/c_4125297?f=options.

Another way to construct a more useful budget is to create stronger connections between the corporate strategy and the budget http://www.cfo.com/whitepapers/index.cfm/displaywhitepaper/11877469. Decide what the organization needs and what doesn’t contribute to the overall plan of the business. This means that the budget is not just being used to document expenses, but to hone in on the most important expenses and weed out unnecessary ones. In this way, budgeting can be a tool for maximizing efficiency.

By planning out how the budget is going to be used, and paring down the process to just what is needed, the budget will be easier to create and use.

Labels: Budgeting

How do you stay competitive when your sales are stagnant or dropping?

Cutting costs decreases the cost of goods sold - giving you a bigger profit margin.

Increase your marketing efforts. Most of your competitors are slashing the marketing budget and decreasing their exposure - this is your chance to outshine them and gain new clients and customers. Take a look at your website and make sure it's optimized for organic searches (SEO).

Expand your PR campaign to including pitching stories to local newspapers about how your product can help people save money. If you're doing the PR yourself - this is free.

Improve your product to make it more attractive to customers. Have the product development and marketing teams determine which improvements will make the most impact in the marketplace and to the bottom line.

Don't shoot yourself in the foot.

• Don't decrease your customer service to the point where customers can feel it.
• Don't put off equipment maintenance (repairs are more expensive by far).
• Don't decrease the quality of your product.
  

We hope you've found this series to be helpful. If you'd like to share tips of your own, please send us a comment.

Labels: Budgeting, Cash Flow, Finance Tips

Remember when the two things that crowded your mail box were catalogs and credit card offers? Have you noticed how few card offers there are these days? I'm sure all those trees are happy, but for the rest of us it's proof of what we already knew - the credit crisis has affected us as well.

We've been hearing it from our customers and reading about it in the papers - businesses are moving to a cash model to pay for regular expenses. They want to conserve their credit line for important things like emergency repairs for equipment or an upgrade that will make them more competitive.

The big question is - how do you make this happen?
If you're a small company, with less than 100 employees, you are at the highest risk to fraud and abuse (http://www.acfe.com/resources/view.asp?ArticleID=9), and must take additional steps to protect yourself. So, moving to a cash (or same as cash) system may seem unwise, because these are inherently riskier forms of payment (http://www.afponline.org/pub/pdf/2008PaymentsFraudandContolSurvey.pdf).

As someone who works for a prepaid business card company, I know that prepaid cards can help bridge the gap between controlling payments and a cash based system. Here's how it works: in advance of purchases you load the card with funds. In the PEX Card system, you can decide what merchant categories are allowed, how much is on the card, as well as a daily spending limit. You can also cancel or block card usage at any time. The PEX Visa Prepaid Card can be used wherever Visa debit cards are accepted, so making purchases is convenient. When purchases are made, you can see them posted in real time. Additional features to keep your company safe from fraud and abuse, include separation of company funds and card funds, ability to remove excess funds from cards, as well as no access to cash advances or ATMs.

If you do use an actual cash or check model, you need to set up regular controls and audits to ensure that your system is the least susceptible to fraud as possible. We suggest hiring a certified fraud examiner to audit your current process and suggest places for improvement or additional control mechanisms. We also suggest that payment paths are separated, so that one person is not responsible for everything from request to payment. And lastly, when employees go on vacation, be sure to review their work - especially those in financial positions. If someone refuses to go on vacation - insist they do. It is often the people who seem to be the most dedicated that are your biggest threat.

Click here if you'd like to see a demo of the PEX Card administrative interface.

Labels: Budgeting, Expense Fraud, Finance Tips

The financial crisis has many of us taking a long hard look at how we conduct business. We're looking for ways to cut costs, conserve cash and credit, and still run a profitable business.

Over the next few installments we'll discuss the financial crisis and ways you can strengthen your business. If you have comments, suggestions, or just want to add your two cents, please feel free to chime in.

If you haven't already seen this article by Michael Lewis (author of Liar's Poker) on how we got here, it's definitely worth a read.
http://www.portfolio.com/news-markets/national-news/portfolio/2008/11/11/The-End-of-Wall-Streets-Boom?page=0

Labels: Budgeting, Cash Flow, Finance Tips

Though your business is driven by your out-of-the-box ideas and your top-notch execution, don't let the accounting fall by the wayside. Customers are under pressure to stay in (or under) budget - and this is where you can really set yourself and your company apart.

Make sure your team has a clear understanding of what the budget is, how it is allocated and how expenses are going to be tracked. If your non-invoiced payments are usually executed with petty cash, be sure to have a system in place for collecting receipts, recouping excess funds, and accounting for it all (Quicken or Excel are both easy to use options for this). Centralizing petty cash with one person in charge is a must. If it's an event with many distinct departments consider giving each a petty cash fund and an officer to manage it.

If you prefer not to have all that cash roaming around, and want to save yourself some time, trouble, and paperwork try using a controllable corporate card, like PEX Card. PEX Card allows you to set specific spending profiles to each cardholder. For example, one employee may be authorized to spend $100 per day at only retail stores, while another is authorized to spend up to $2,000 in any merchant category. At the end of the event you will not only be on budget, but you'll have a complete record of all spending.

If you are able to stay on or under budget your clients will remember you as that fantastic event marketer with a head for numbers, and you'll be working with them again sometime soon.

Click here if you'd like to see a demonstration of how PEX Card can you help control employee spending.

Labels: Budgeting, Finance Tips, Petty Cash

Particularly when discussing the finances of a nonprofit, administrative overhead comes into the conversation. Donors want to know exactly how much of every dollar is going to the cause and how much is going to manage the organization. Private sector companies also need to keep an eye on this aspect of business because while infrastructure is important, every business needs to maximize efficiency in order to affect the bottom line.

So how do you keep that administrative overhead low? There are a few things to keep in mind when evaluating and cutting some of these costs:

Endorse Telecommuting
While not every industry can have employees work from home, it is a good idea when possible. The same work can get done with fewer people in the office, enabling you to decrease office space and reduce utility (i.e. phone, bandwidth, electricity) consumption. This can do a lot to cut the overhead.

Consider Job Options
One of the largest pieces of the budget is paying for employee salary and benefits. Whenever you are hiring, take time to construct the position requirements carefully so that you can find the right person and get as much value as possible per employee. Also, consider temps or consultants as full-time employee alternatives without as much overhead.

Time Tracking
It's hard to minimize administrative overhead if you don't know where the black holes of time management exist. By setting up a convenient way for employees to track their time, you can see where in the process things need to be more streamlined.

Labels: Budgeting, Finance Tips

One of the biggest ways companies can improve cash flow as well as the bottom line is to cut costs. Yet cutting costs without impeding growth can be a delicate balancing act. In order to navigate the tight-rope here are our top 5 tips for effective cost cutting:

Engage employees -
http://findarticles.com/p/articles/mi_m3495/is_11_48/ai_111170582
If you keep a dialog open, employees are on the front lines and can point to some of the best cost cutting measures.

Focus on variable costs -
http://www.morebusiness.com/running_your_business/profitability/Controlling-Costs.brc
Make a list of which costs absolutely must stay so that you don't end up cutting something you need, which could cost you more in the long run.

Don't cut valued perks -
http://www.fastcompany.com/blog/heath-row/cost-cutting-gone-wrong
While taking away those unnecessary perks may seem like good decision-making, it can adversely affect morale and decrease productivity.

Utilize free ad mediums -
http://www.atouchofbusiness.com/business-topics/cost-control/advertising-rates-00013.html
Advertising is an important way to attract new business and it doesn't have to cost an arm and a leg. Look into opportunities for free advertising in order to complement your current ad campaigns, but make sure they don't compromise the integrity of your brand or appear in places you find questionable.

Value Experience and Talent -
http://startup.partnerup.com/2008/09/15/cost-cutting-mistakes/
Cutting out costly employees might seem like a quick way to fix the budget, but this often entails spending time on choosing and training new hires that don't have the same experience and talent.

Labels: Budgeting, Cash Flow, expense management, Finance Tips

During Senator Lieberman’s last election campaign (click here for the article), he went through a reported $380,000 in petty cash. There’s nothing petty about hundreds of thousands of dollars. Where did that money go? While a successful political campaign might be able to just write it off as “petty cash” and move on, no business can function like that. And one quick Google search on “petty cash procedures” shows that no one else does. Lots of time and effort has been spent working on regulating and documenting the money flowing into and out of the petty cash drawer.

Here are some dos and don’ts that can help guide your petty cash system and procedures:

Do make sure that all employees have access to needed incidental funds. Some employees might be in the position to need more petty cash than others, but all employees should know how to access it and be able to take out funds if the need arises.

Don’t put all the responsibility of petty cash on one person. The petty cash system does need a custodian and someone to ensure that everything is working as intended. However, each employee should feel responsible for their petty cash transactions. Encouraging shared responsibility will help foster responsible spending and thorough documentation.

Do decide on a set amount of petty cash. You can re-assess if this was too much or not enough. If you don’t want to deal with how many bills or how much change you need, consider a prepaid card system with a set amount in a bank account.

Don’t let petty cash be used for everything. This fund is really meant for small, immediate purchases. Set limits to what does and doesn’t fit under petty cash. With careful documentation, you should be able to check and see where the petty cash money is going and discourage larger purchases through the petty cash system.

Petty cash doesn’t have to be an undocumented mess, nor does it have to be a complicated burden. It just needs to have a clear purpose and straightforward process.

Labels: Accounting, Budgeting, Petty Cash, Travel Expenses

How do you go about nurturing a relationship with your business’ bank? And how can this effort result in better service for your business? Surprisingly, a close relationship with the bank and bank representatives can lead to a surprising amount of savings, both through better loan rates and discounted services. There are a few key points in creating this rapport.

The Importance of Bank Relationships
Bank consolidation is leading to bigger chains and fewer choices, meaning that creating a relationship with a bank and being a face rather than a number is becoming more and more important. Why? Loan rates can be negotiated and services like a line of credit and payroll deposits can be added for free or for a small fee. Bank managers have some leeway to offer deals when working with valuable customers and you can benefit from that practice.

How to Foster a Good Relationship
Your bank contact is a valuable business advisor. Offer business plans or other information that would help convey what your business is all about. Let him or her know about your plans for the business' future and ask about the financial aspects of getting there. And don’t forget to treat your banker as a valuable employee, taking time to learn more about him or her. A little effort can go a long way.

Additional Resources:
Buddy Up: How to Develop a Friendly Relationship with Your Bank - http://www.entrepreneur.com/money/moneymanagement/article22796.html
What’s New in Bank Relationship Management? - http://www.afponline.org/pub/res/news/ns_20040715_masson.html
The Importance of Building a Good Relationship with Your Bank - http://www.articlesbase.com/finance-articles/the-importance-of-building-a-good-business-relationship-with-your-bank-487499.html

Labels: Accounting, Budgeting, Finance Tips

Improving the bottom line is a major goal for every company. Taking just a few steps can save money and have a big impact. Figuring out which steps to take can be a daunting task. Fortunately, we’ve done some of the legwork already. Here are some surefire ideas:

Use Open Office – Why pay hundreds of dollars in licensing fees for Microsoft Office when there’s a free alternative? Creating documents, spreadsheets, and presentations is just as easy and are completely compatible with Microsoft, at a fraction of the price. http://www.openoffice.org/

Automated Payments – Monthly bills need to be paid every month, so plan for it. Set up automated payments if possible and decide on the best day to pay. You won’t accrue late fees, you’ll have fewer checks to cut, and you can streamline the billing process.

Ask for a Deal – If you provide steady business, a vendor might be willing to offer a special price, a bundled package, or some other additional perk that offers value to your company. While you may not always get a break, always ask; you never know.

Turn Off Electronics – Just by making it a policy to turn off (and perhaps unplug) electronics at the end of each day, you can shave a surprising amount of money off the electric bill. In addition to costing money, leaving computers on at night can be a security risk.

Minimize use of cash and checks in your business - Using a purchasing or commercial card, can reduce the internal cost of processing transactions by 70%. The less time A/P staff and bookkeepers spend cutting, mailing and reconciling checks, the less it will cost your business. To better understand the difference between card products in the market, have a look at (link to our post about: Prepaid, Credit and Debit Cards). How many transactions do you do in a month? The savings would add up quickly.

Labels: Budgeting, Cash Flow, Finance Tips

There are some advantages to a credit crunch that can work for you if you capitalize on them. Take this as an opportunity to scrutinize every aspect of your business from expenses to employees to clients. Pairing down what weakens your business will strengthen it.


1) Cut costs - expenses that aren't necessary
Which costs are necessary and which are optional? Candy on the receptionists desk - optional. Electricity - necessary. Color copies - optional. Supplier contract - necessary. And so on.

From the necessary expenses, which costs can be reduced? Ask vendors for more favorable payments terms, whether extended terms or a discount for paying early - this can help your cash flow and bottom line. Decrease your electricity bill by conserving energy - turn off lights in unused rooms and when you leave for the evening and turn off computers when the user will be away for more than 30 minutes. A penny saved is a penny earned - you can do this.


2) Human resources - consider who is on board
Every team has its weak link. Maybe your business has someone on the team who isn't adding to the bottom line or the strength of the company. This could be someone who just doesn't pull their weight, or someone who lowers the morale of those around them. In either case - now is the time to change.

The downturn in the economy means that there are a lot of great people looking for work right now. Begin the recruiting process and find someone that will fit in with your corporate culture and add to the bottom line.


3) Costly clients - are they worth it
You know who they are. They are the clients that take up more time and resources than they pay you. They can be difficult, not pay on time, and suck the energy right out of you and your team. If you don't see your relationship improving in the next 6-12 months - fire them. If something costs more than you sell it for you're losing money. You can't afford that right now. Stay focused on the goal - stay in business and make money.


4) Discounts - they don't always help
Now is also the time to shore up your business to protect you from the worst of the crunch. It can be tempting to lower prices to attract more sales, but this can eat away at your profits quickly. Consider promotions on particular items while the rest of the inventory stays at full price.


Put your business in a good position financially so that you can tough it out now and prosper later.


In a previous post we discussed shoring up business finances to make it through a down-turn, to read it click here.

Submit your questions to "Ask PEX Card" through the comments link below.

Labels: Budgeting, Cash Flow, Finance Tips

If your business is a touring company, you're constantly on the road by definition. Moving from location to location poses logistical challenges on many fronts. Papers, expense reports and receipts can get misplaced and resources aren’t always available. In this situation, cash management can be particularly tricky. Here are some ways to alleviate some of the problems:

• Use a bank with many locations so that you’re more likely to have a local branch nearby.
• Do marketing before arriving at a location in order to increase future cash intake.
• Use a finance system to allocate funds and manage travel expenses for employees.
• Put as many bills as you can to auto pay so that you're never caught with late fees if your mail doesn't reach you on time.
• Above all, create an organization system that works for you and your business. No matter what the system is, the most important part is that you know where to look for information.

Have you found more ways to manage cash flow while on the move?

Labels: Budgeting, Cash Flow

For a company to run smoothly, employees must be able to make the purchases they need, whether that involves supplies for the office or T&E on the road. To keep expenses from getting out of hand, employees should have spending limits, enabling the company to minimize costs and the employees to know the budget they’re working with. This system works extremely well if the spending limits are appropriate and well thought out. The process of setting employee spending limits can be complex, but there are some tips and tricks that can help make this task easier.

Allow for Flexibility
Spending needs may fluctuate from week to week and month to month, so recognize that limits can’t be set in stone. Have a way to alter spending limits at a moment’s notice so that unexpected, but essential expenditures can be made.

Get Informed
In order to set spending limits, you need to know what is being purchased. Ask employees for their opinion regarding necessary spending. And look into the IRS policies when setting limits, particularly on things like per diem rates.

Create a System
Prices will go up, employees will be hired, and spending needs will change. Have a system in place to periodically evaluate and adjust spending limits as needed. Then you can be as accurate as possible without having to worry about things like daily authorizations.

Labels: Budgeting, Per Diems

Who wouldn't want to get something today without having to pay for it until tomorrow? Float is a convenient way to get goods and services now and pay later, whether that later is within 30 days or there is a longer grace period. This can be very attractive to a company looking to increase their cash flow.

The downside of this practice are the penalties and interest that can come from waiting too long to pay off debt. Also, the process of scheduling payments at random times during the month, cutting checks, and managing invoices often is the hidden cost of float. While you may be able to pay vendors later, you’ll eat up valuable employee time trying to manage lag time before payment is due. And if you are sent more than one invoice noting the payment due, it is far too easy to accidentally double pay.

The other option is to pay now. There are definite advantages to avoiding taking on debt. You may be able to negotiate discounts with vendors if bills are always paid on time or before they're due. Paying on time can also cut down on employee hours spent managing payments and avoiding late fees. While it may mean parting with funds before you have to, paying now can put you in a good position to avoid accruing additional expenses. If you feel divided about what to do, set thresholds and pay amounts under, for example, $2,000 while floating anything above that until the due date. You will reduce the number of held payments while getting the benefit of the float.

Both paying now and floating are valid ways to handle expenses and each has advantages and disadvantages. Ultimately, the right decision for you depends upon your company’s cash flow situation.

Labels: Budgeting, Cash Flow

For any business with a fleet of vehicles, the need for cost management becomes immediately apparent. Fleet spending, particularly due to rising fuel cost, can cause the budget to soar. However, with some careful management, you can cut down on unnecessary costs and increase the efficiency of your operation. Here are some tips on fleet spending management:

• Track fuel usage of your vehicles. If some trucks, buses, or vans are using more fuel, it may be time for maintenance or time to retire an inefficient vehicle.
• If some employees tend to use more gas, consider a training course for gas-efficient driving. A higher gas station bill might also indicate expenses other than fuel, so be sure to set up a way to separate fuel costs from per diem costs.
• Also, when monitoring your fleet, see how much business each of your vehicles produces and consider cutting less profitable routes. Each vehicle you can cut out saves a lot of money. Just cut back carefully and sparingly so that you still have room for growth.

A fleet can be expensive to maintain, but with some careful expenditure tracking, you can streamline the process and determine where costs can be reduced so that your fleet is at its most efficient.

Labels: Budgeting, Travel Expenses

Managing the travel and entertainment aspects of the budget can be a tricky balance between controlling expenditures to keep costs down and empowering employees to make smart decisions. Watching the bottom line at the expense of your employees is never a successful plan, yet it is possible to carefully curtail spending without lowering morale.

• Establishing a per diem is a great way to let employees decide where their travel money goes without negatively impacting finances.
• Having one company way to book travel, whether it’s a particular travel agent or online site, will make it easier to book and pay for travel in a consistent way while still giving employees options.
• Travel is taking employees away from family and friends, so perks like frequent flier miles will be well received, and won’t adversely affect your budget.

According to an article in Microsoft’s small business resource center, "A 2001 Gartner Group study found that just a 5% reduction in operating costs in the expense-management process has the same effect as a 30% increase in sales."

Cutting costs can have a profound effect, as long as you take care to create a balance between greater controls that will decrease spending and employee empowerment to make business travel less of a chore.

Labels: Budgeting, Travel Expenses

While soaring fuel costs are making many companies cut back on travel, there are trips that simply cannot be eliminated. And for these necessary trips, the travel and entertainment budget is often a large chunk of discretionary spending, making it one of the easiest places to cut back. Managing the travel and entertainment expenses can affect the company’s bottom line, so how do you find ways to keep these expenses in check?

Clear travel policy
Set a company travel policy with specific guidelines on how to spend company money while on the road. Then trust in your employees to make smart decisions while traveling. It's easier for employees to make the right choices when they know what is expected of them.

Consistent travel standards
If the company policy is to fly coach, stick to that and have everyone fly coach. Having management travel in a different style than the rest of the company can cause tension and lead to overspending on travel company-wide.

Online booking
Travel agents are a thing of the past for many companies. Discounts are getting easier to find online due to increased competition. Plus, a range of travel options can be presented and approved before expenses are incurred, making sure wise choices are being made.

Report sampling
By auditing a small sample of your expense reports, you can find ways to maximize the benefit of your T&E dollars. These internal audits can help determine the hotel chains and airlines where your company books the most business -- and this data can then be used to negotiate a discount. The audit process can also uncover inconsistencies and target red-flag or rouge spending behaviors that may point to misuse. The goal of the auditors is to help pinpoint places to save money without negatively effecting the employees' perception of travel.

By promoting responsible travel as part of your corporate culture, you can have budget-friendly travel expenses as well as satisfied employees.

Labels: Budgeting, Travel Expenses

How long does it take you to close the books at the end of the month? How about the quarter? For many companies, the process takes days, and it doesn’t have to. Advancements in accounting software have streamlined the process of keeping the books, making it easier to track expenses in real time. When costs are tracked in this way instead of being pulled into a spreadsheet at the end of each month, it is less time-consuming to report and easier to monitor expenses.

While this type of automated system for accounting has already been widely accepted at the largest corporations, small and medium sized businesses are often still doing the books by hand. Even relatively small businesses can benefit from software, as it cuts down on time personnel spend closing the books and their time can be spent evaluating expenditures instead.

No matter how you keep your books, be sure to watch out for things like creating a miscellaneous category or putting one item under multiple categories. Spending a little time now to create clear designations for expenditures can save a lot of time later on. For more bookkeeping tips, both for accounting by hand and using software, visit the Basic Bookkeeping Tips at AllBusiness.com.

Labels: Budgeting, Finance Tips

Cash flow is at the heart of every business and it often determines a company's success or failure. By using cash flow management tools, your business can understand and regulate the influx of funds as well as outflow of payments. And anything that helps you regulate the flow of cash into or out of the business is a cash flow management tool. The cash flow management tools that are most useful to you are dependent on what kind of business you have.

For a product-selling business, an inventory report is of vital importance. It can help you to identify trends, point out potential slow months, and figure out when would be a good time to put products on sale.

If you have large contracts, then look for a budgeting tool that can help you plan out cash usage now for a long-term project. This can help prevent cash running out in the final stages of work or having to go back to the client to renegotiate the budget or terms of payment.

A service company may want to look for a program that allows grouping expenses by account and dividing up expenses among different clients. This gives you a better idea of how much is going into each project and provides the tools necessary to determine if it is an efficient use of your resources.

In a tight economy, cash flow management is an essential practice that can be made easier with programs to organize and assess the movement of funds.

Labels: Budgeting, Cash Flow

The troubled economy could be detrimental to any business and a close eye on cash flow can mean the difference between profit and loss. As keeper of the books, finance managers are in the prime location to evaluate expenditures and find ways to save the business money and stand out as a valuable asset to the organization. If done carefully and judiciously, cost cutting can help maximize efficiency without negative repercussions.

So how do you decide which costs are necessary and how cuts will affect the operations of the business?

Separate budget items into necessary costs and optional costs then see which of the optional costs are driving growth and sales. Optional costs that are not adding to the business are prime candidates for budget reduction. As far as the necessary costs, look for different options that can achieve the same result for a lower price, such as a less expensive telecom package. Consider long term cost cutting measures involving revamping procedures, general accounting and purchase order processing are two of the top ten places companies can reduce costs, as opposed to short term solutions that may have unexpected consequences. With some evaluation, research, and creative thinking, a surprising amount can be trimmed from the budget.

For more information and ideas on how to pare down business costs, here are a couple additional resources worth reading:
Business Finance Magazine – Top 10 Opportunities for G&A Savings
CFO.com – Keeping Cash Safe

Labels: Budgeting, Cash Flow