You’ve successfully launched your business, and the sales are rolling in. You have a great product, a great store, and hard-working employees. Things are going well this month! Until you realize the end of the month arrives, along with all the bill payments.
Now that you have a booming business, there are monthly bills to pay for the company as well! Good thing you are making lots of sales, you have budgeted accordingly, and your business finances are in check. But wait - after the end of the month, you take away close to nothing. Guess it’s time to have a closer look at your business finances to identify where the money is going.
You didn’t get into business to break even, so how do you begin managing your business finances better? The first step is to understand that each business decision you make has a direct impact on your bottom line. You must weigh many factors before making an investment or purchase that you think will help your business grow. In this article, we talk about how you can utilize accounting to ensure you’re making informed business finance decisions.
Below are 3 easy steps to making business decisions using financial statements:
1. Start measuring your finances
The first step to better decision making is to increase the certainty of your decisions. The more confident you are with your decisions, the more likely you are to follow through with the execution. If you are in doubt when executing decisions, there is a high chance you’ll waste time reconsidering or half-heartedly following through. This indecisiveness can result in mixed results, causing you to give up on an otherwise excellent decision because of the distractions during your execution process. This article aims to improve business decisions through the use of your financial statements.
2. Obtain your Account Statements
Tracking and measuring your finances started the moment you opened a business bank account for your registered business. You can go to your bank at any time and ask for transactions from the very beginning. Your transaction history is also available online at any time using your bank portal. To get started, you’ll need to monitor your transactions regularly. Transaction histories are contained in your account statements. Select your bank below to learn how to obtain these statements digitally:
- Bank of America
- Wells Fargo
- US Bank
- TD Bank
- Capital One
- Fifth Third Bank
- Citizens Bank
3. Use Account Statements and Business Finance
Use these bank account statements along with financial statements to collect historical data on your business. Financial statements organize your transactions to help give you a broader picture of your business. It tells you all about the money going in and out of your business bank account. Financial statements take this one step further and allow you to have a solid understanding of the factors, directly and indirectly, affecting your business performance.