Initial financial management considerations for SMEs

POSTED: 8th February 2013
IN: Guides

Life as a burgeoning small or medium-sized enterprise can be an exciting prospect but there are a lot of considerations to take into account before a start-up can expect to snowball towards success.

While every business knows that pleasing the customer it is delivering goods or services to is paramount, it needs to also remember that financial management is core to growth.  

If cash flow is not kept in check, a small company can run itself into the ground even if it was spot on in terms of identifying and targeting the right market, because at the end of the day, it is money that counts.

So when trying to get a start-up in order, there are a number of questions that need to be answered to ensure it goes from strength-to-strength.

First of all, the business needs to ask itself where investments have to be made - that could be on staff, products, services, machinery or equipment, for example.

Then the company needs to think about what solutions there are to overcome a lack of initial finance.

Asset finance can come in useful here and is a flexible way to ensure a company is able to grow. A solution from Aldermore will enable the business to pay for the asset while it supports the company.

A business also needs to consider the speed of its payment transactions. Efficiency is key not only to keeping customers happy, but also to ensuring the smooth running of the firm.

As such, a mobile payment system may be an effective way for small businesses to process transactions quickly. The added bonus is that such technologies are easily transportable and cause the customer little fuss in terms of making payments.

A really big question to ask is how well equipped the company is to handle its finances without the aid of a bookkeeper. He or she will be able to manage the day-to-day financial matters to spread responsibility. 

And as long as the finances are all in order, the company should be able to build from that foundation for years, and maybe even centuries, of success. 

Subject to status. Security may be required. Any property or asset used as security may be at risk if you do not repay any debt secured on it.

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