Accounting & Start-up financial management
As a mentor I looked at OKR, KRA and KPI’s. They are great but they stare at you only at the end of each quarter, Hence as a team we need to focus on more sustainable ones on what is being referred to as “Micro Habits”.
• Identify a micro habit
• Piggy back on daily task
• Track progress daily
• Hold steady for a long time
• Seek help in holding you accountable
This cycle will help to get to your Goals much better than conventional modes. Habits help you follow a method which when executed with a “Proper Plan of Action” helps you win “Small Goals in Life” compounding to accomplish the larger goals of Life.
5 Ways to Improve Startups Company’s Accounts Receivable Process
Maintaining a general ledger is one of the most tedious tasks that companies face daily. Managing a venture’s cash flow can be tough, more so if you still rely on manual or outdated systems for data-heavy accounting tasks such as balancing your checkbooks.
One form of cash flow that should be factored into the modernization efforts is ones accounts receivable (A/R) stream. Simply put, the accounts receivable represents the amount that customers owe for your services or products.
Essentially, A/R is included in your ledger when you let a buyer purchase your goods on credit. The amount of money the customers owe is usually collected within a few weeks, after which it will become an asset. This leads to transparency.
Revamping ones A/R process can prevent the waste of capital, heighten liquidity, and reduce overall debt. On the other hand, retaining an unfavorable A/R processing system could make you vulnerable to bad credit management, improper payments, and other financial missteps that could snowball from there.
Reassess startup Tech Support
If there is a feel as though the current accounting system is bringing you more headaches than solutions, it may be time to invest in new technologies to manage your company’s funds. For one, an efficient accounts receivable monitoring system will help you gain visibility over your data and automate laborious number-crunching and recording tasks.
Moreover, such systems may have the capacity to generate comprehensive reports on cash flow, current balances, and profit and loss (P&L) data to give you an overview of due payments and transaction records. One should also opt for a centralized A/R system to make audits less disjointed and ensure the continuous issuance of accurate invoices. But beyond efficiency, your account management system must be secure enough to prevent unlawful breaches of company and customer account data.
Practice Proactive Billing and Invoicing
Some startups may be hesitant to send out payment terms or have no sense of urgency with payments. The truth is, having a timely dialogue on billing is a practical move that will benefit both you and your customer. It’s better to set expectations outright than deal with consistently overdue payments down the line.
It may help to automate your billing and invoicing processes to ensure that payment terms, deadlines, and other pertinent information are properly communicated as early as possible. Additionally, it may be beneficial to have a system that can intuitively detect accounts that are at high risk of paying past due. For one, you can set up an easily accessible customer portal to make the payment process easier on both ends.
Take Care of Your Customers’ Data
Discrepancies in invoices and mailing data often result in delayed receipts, which can lead to further delays in terms of payments. As mentioned earlier, a centralized system allows your accounting staff to keep track of data such as balances and mailing addresses without being limited by disjointed silos. Real estate is a business which is also known for unethical practices which needs detailed explanation to customers on transparency.
Apart from heightened visibility, a unified system can help you address changes quickly and prevent inaccuracies in data entry from affecting the smooth flow of processes. As such, it’s best to implement a system that makes regular assessments to detect and apply changes in payment terms, credit limits, and discounts. Also addressing customers queries on tax implications and other norms set by the Govt.
Team Exposure to funding process
Fund raising is an interesting process and learning from the same is immense. The young team gets exposure to this which opens up opportunities in plenty for learning. They stand to learn various aspects of funding process, what are the expectations of the VC community, the kind of documents which need to be prepared in the process.
Smoother Ways to Manage Your Cash Flow
The potential inability of vendors to pay what they owe can bring a lot of financial headaches that are detrimental to your venture. Still, it’s possible to prevent instances like this from negatively affecting the strides of your business. With the right tech and knowledge of best practices, one can easily balance the books, maintain a stable cash flow, and stay on track toward industry survivability and all-encompassing growth.