As you work on growing your business, you’ll have days of uncertainty, excitement, and everything in between. While many business owners try to run their business on intuition and gut feelings alone, there’s a benefit to working with an accountant to put numbers into place that track and monitor your progress toward your growth goals. As the saying goes, “Numbers don’t lie.”
Putting aside the fact that, as an accountant, I’ve seen plenty of numbers that lied, I’d like to focus on the truth in that statement about numbers. They aren’t fickle or based on feelings. Even when there are inaccuracies, it’s usually a problem with the calculation or humans running the numbers rather than the numbers themselves. A good accountant helps you use your business’s numbers to keep you focused on growth so that whether you feel happy or sad on a given day, you can look at the data and make a solid decision that keeps you heading upward.
Question #1 – How can we make sure we have enough cash to cover our costs and replace equipment when we need to?
Cash flow is the lifeblood of any business. Without a healthy cash flow, businesses may struggle to pay employees, meet vendor obligations, or invest in growth. Breaking even and maintaining the capital needed to replace assets over time ensures the business remains operational and competitive. Unexpected cash shortfalls can lead to costly debt or missed opportunities, stalling growth.
A good accountant can help you plan for keeping enough cash on hand by:
- Performing cash flow forecasting to identify potential future gaps and help prepare for them.
- Providing financial analysis and cost optimization strategies to ensure efficient use of resources.
- Implementing budgeting tools and practices that allocate funds strategically toward growth and capital replenishment.
- Using tax planning strategies to minimize liabilities, such as accelerating deductions or leveraging credits, leaving more cash on hand.
Question #2 – What steps can we take to maintain strong relationships with our customers and optimize our operations?
Happy customers drive repeat business, referrals, and long-term sustainability. At the same time, efficient operations reduce costs and enable scalability. Balancing customer satisfaction with operational efficiency is key to maintaining a competitive edge in the market. Businesses need to identify which customers and processes deliver the highest value. From a numbers perspective, an accountant (particularly one with CFO and controller expertise) can help you do the following:
- Analyze customer profitability data to identify your most valuable clients and tailor your efforts toward retaining them.
- Offer insights through operational performance metrics, helping to refine inefficient processes.
- Support the development of pricing models that reflect value while remaining competitive.
- Provide tools to monitor Key Performance Indicators (KPIs) for both customer satisfaction and operational success.
Question #3 – Am I prepared to adapt to market changes, avoid over-control, and make timely investment decisions?
Being adaptable in the business world is vital, especially when technological growth and AI adoption are driving rapid innovation and changes across industries. Over-controlling decisions or delaying investments can result in missed opportunities. A business that stays agile and responsive to trends and shifts in customer demand will better position itself for growth. However, this requires an understanding of the financial impact of decisions and the ability to pivot quickly when needed. This is where a tax and accounting firm like MBS Accountancy can help you. Our accountants can:
- Conduct financial modeling and scenario analysis to evaluate potential outcomes of market shifts or new opportunities.
- Offer investment analysis to weigh the financial pros and cons of new ventures or expenditures.
- Advise on tax-efficient investment strategies, ensuring the company maximizes after-tax returns.
- Provide strategic advisory services, helping leaders strike the right balance between control and flexibility.
Question #4 – How can I leverage debt and equity financing while growing my business without over-extending?
Rapid growth often requires significant capital. Understanding how to manage debt and equity financing is vital to ensuring the business doesn’t overextend itself or dilute ownership unnecessarily. Balancing debt with equity while maintaining a sustainable debt-to-equity ratio ensures the business can scale without jeopardizing financial stability. A skilled accountant can help you answer this question by handling the following:
- Providing financial statements and analysis to assess the company’s financial health and borrowing capacity.
- Assisting in crafting a business case for securing loans or attracting investors, backed by realistic projections.
- Advising you on the cost-effectiveness of different financing options and their implications for the company’s financial structure.
- Monitoring compliance with loan covenants and providing ongoing debt management strategies.
Question #5 – How can I delegate responsibly as my company grows, without endangering performance or profitability?
As a business grows, you must delegate responsibilities to ensure you’re working efficiently and can focus on strategic priorities. However, without clear monitoring systems, your delegation efforts can work against you by allowing for reduced accountability and promoting inefficiencies. A strong company culture and robust performance tracking mechanisms are essential to align all team members with growth objectives. An accounting firm like MBS Accountancy can help you avoid this by providing:
- Customized financial dashboards to track performance and key metrics in real time, empowering leaders to monitor delegated tasks effectively.
- Training and guidance to in-house accounting staff to ensure they are equipped to handle responsibilities effectively.
- Outsourced CFO or controller services that oversee financial operations and reporting to free up the leadership team for strategic growth initiatives.
- Periodic financial reviews and audits to maintain accountability and alignment with growth goals.
Question #6 – How can we control vendor costs and avoid over-reliance on one supplier while we grow?
As your business grow, your expenses will increase in complexity and scale, making it critical to understand where money is going and how efficiently it is being spent. A vendor expense report provides a detailed breakdown of costs by supplier, offering insights that go beyond simple payments. It lets you identify high-cost vendors, track spending patterns, and pinpoint areas where savings can be achieved.
For example, analyzing vendor expenses can reveal opportunities to renegotiate terms, bundle services for discounts, or switch to more cost-effective suppliers. Plus, an accurate report ensures that all expenses are categorized correctly, which is essential for maximizing tax deductions and avoiding costly compliance errors.
Gathering vendor data into a vendor expense report can also highlight risks, such as over-reliance on a single supplier, which could disrupt operations if the supplier increases prices or becomes unavailable. Diversifying vendors and planning for contingencies are key to mitigating such risks. A vendor expense analysis also supports strategic growth by helping business owners allocate resources more effectively so that spending aligns with growth goals and doesn’t hinder profitability. If you’re working with an accounting partner, they can:
- Analyze vendor expenses to identify high-cost suppliers and evaluate cost-saving opportunities.
- Provide recommendations for renegotiating terms, consolidating purchases, or switching to more cost-effective vendors.
- Ensure accurate categorization of vendor expenses to maximize allowable tax deductions.
- Assist with managing vendor-related tax forms, such as 1099s, to ensure compliance and avoid penalties.
- Develop contingency plans to address potential vendor disruptions or cost increases.
- Use vendor expense data to create accurate budgets and spending forecasts that support growth objectives.
- Provide ongoing monitoring of vendor relationships to ensure costs remain aligned with value as the business scales.
Ready for growth-focused accounting and tax services? Contact us
At MBS Accountancy, we offer the expertise and tools needed to address your growth challenges and drive growth effectively. Our services include cash flow forecasting, tax strategy optimization, and vendor expense analysis to ensure your business stays financially healthy and operationally efficient.
Whether you need help managing vendor relationships, optimizing tax savings, or planning for long-term scalability, MBS Accountancy is your partner in growth. We specialize in providing tailored accounting and tax solutions that empower businesses to overcome obstacles and seize new opportunities. Contact us today to learn how we can help you achieve your business goals.