Running a business involves a great deal of work. You may need to open your store, greet customers, stock shelves, keep your website up to date, fulfil customer orders, and manage various other tasks related to your business. One crucial aspect of being a business owner is making financial decisions.
It’s up to you to decide how to accept payments from customers, know where and how to access funding, manage the timing of your revenue (incoming money) and expenses, and ensure your business remains profitable.
While you may prefer some tasks over others, everything from customer service to financial management plays a vital role in starting, running, and growing a successful company.
Managing cash flow and expenses
If you’re running a small business, when you get paid can be just as important as how much you get paid. Predicting and managing your cash flow—the timing of when money comes in versus when you need to pay bills—is an essential skill for success. Manage your cash flow.
Understanding profit and loss
At the end of the day, your business needs to generate more income than it spends to be sustainable. Creating a profit and loss statement, and understanding how to interpret it, can help you identify ways to increase revenue, reduce expenses, and improve profitability. Make a profit.
Choose a payment option
As a small business owner in South Africa, you’ll need to decide what types of payments to accept, such as cash, EFT (electronic funds transfer), debit and credit cards, and mobile payment solutions like SnapScan and Zapper. Offering multiple payment options can help attract a broader customer base and encourage larger purchases. However, each payment method comes with its own costs and considerations. Learn about different payment options.
Use banking services
One of the first steps after establishing your business should be to open a dedicated business bank account. This helps separate personal and business finances, making it easier to manage cash flow, protect personal assets in case of business financial difficulties, and streamline tax preparation. Many South African banks offer business banking services tailored to SMEs, including merchant services and business loans. Find out how building credit could help your business.
Access business credit
Businesses can build credit histories separate from their owners, which can help when applying for business loans or lines of credit. Establishing good business credit can improve your chances of securing funding from banks or alternative lenders. South African business owners can explore funding options from institutions such as the Small Enterprise Finance Agency (SEFA), banks, and fintech lenders.
By staying on top of your business finances, you can make informed decisions that contribute to the growth and sustainability of your venture.