Most small business owners are used to doing much of the work themselves. It’s likely how you started and what has saved you money here and there over the years. However, a small business can quickly turn into a not-so-small business and the money side of things starts to get more and more complicated as you grow. Between hiring employees and outsourcing work, increased revenue quickly turns into increased expenses. We have six ways an accountant can help your business during a period of growth and beyond.
Updated business model
As you grow, your business model and plan are likely to change. While the beginning stages of your new business are typically about building clientele and capital to re-invest, further stages in your development are going to be more about increasing your revenue. An accountant can help you draw distinctive lines between re-investment and revenue to maximize the benefits of how you’re spending your money. With an updated vision of your business model, you can be certain that you have a strong direction for the future.
Navigating rapid growth
A growing business has different financial needs than a startup. This can be differences in financial needs as well as revenue goals. An accountant can help you prioritize your needs and goals to grow your business in the most efficient way. Rapid growth can be exciting and it’s common to try to implement new products and services. An accountant will help make decisions in areas that will provide the best return on investment during your growth period.
Sometimes growth can be a difficult thing to manage. While a larger budget is nice, it’s important to properly allocate those funds to areas of need. Your eyes can get bigger than your wallet and it’s possible to spread your money too thin. An accountant will help you identify the areas that need funding now as well as others that can wait. This makes it easier for you to make your budget more efficient and stretch your funds longer.
Part of establishing a budget is identifying the kind of help that you can afford to bring on board. A solid budget will dictate whether you’re able to bring on full-time employees or on-call contractors.
Taxes can be confusing. With new tax laws, incentives, and rebates in place each year, it’s important to make sure that you’re checking all the right boxes. Furthermore, you can minimize the amount of taxes that you’re paying while also maximizing your revenue. Your accountant will know how to navigate your specific tax situation so that you don’t miss out on further growth opportunities.
In addition to doing taxes for you, an accountant can help with an audit. If the IRS is auditing your business, it’s crucial that you find all documentation to ensure that the IRS isn’t taking unnecessary funds from you. Your accountant will know what exactly the IRS is calling for and help you assemble the necessary paperwork to correctly document expenditures, revenue, and write-offs.
Applying for business loans
It’s possible that your business is growing faster than you’re bringing in revenue. This can be the case if you’re in need of machinery to produce more products and meet demand, your inventory can’t replenish fast enough for order fulfillment, or you have more appointments than employees who can fill them. These missed opportunities can lead to lost revenue and lost growth opportunities. A business loan can help by giving you the boost that you need to catch up to a rise in demand for your products and services.
By enlisting the help of an accountant, you can be sure to get a loan for the proper amount of money for your business without overshooting your budget and ability to repay it each month.
While your business is growing and there’s more work to be done, you’re going to need employees to help with the workload. However, part of having employees is properly compensating each and providing proper tax documentation to go along with it. Whether you have full-time, part-time, or contracted employees, you’re going to need someone who can properly distribute W2s and 1099 forms when the time comes.
While bringing an accountant in-house is always an option, you can always outsource bookkeeping services for small businesses to an accountant firm. Both have their pros and cons as an internal bookkeeper will be more familiar with your internal affairs, while a firm will have more diverse experience and be able to provide more nuanced advice for your business.