The main cause of small businesses fail within the first 20 months is poor financial analysis and management. If startups do not fail within these months, it is very likely that they will stagger before gaining momentum. But why is it that poor management of finances leads to business failure? The answer is simple; it is because most managers take the financial journey solely without involving BUSINESS ADVISORY SERVICES. This is a wrong practice that most managers take and it’s very toxic to the success of the business. It is very true that most organizations would focus on cutting cost by eliminating outsourcing of external financial assistance. A research that was done on small business shows that 60% of small firms do not involve Tax Accounting & Business Advisory services. The research also unveiled that 40 % that practice accounting and taxation use paperwork to manually keep their financial data. Managing financial information manually is a direct path to failure as there is no way you will be able to compare results.
While it is not a crime for a business to have accounting experts, we cannot underestimate the great value and deep knowledge that experienced BUSINESS ADVISORY SERVICESprovide to an organization. We also understand that it can be expensive to have a full-time accountant employee who is entitled to a monthly stipend whether working or not. However, the same way you take your car for service when there is a breakdown or need for maintenance is the same way you could hire a professional financial expert to take care of your financial management needs. An accountant will do more than just tax filing, and balancing financial books.
They will go ahead and do an intensive financial assessment and provide a forecast over the year to give you a glimpse of the future. Having an eye for the future helps businesses thrive in hard times because they are always prepared to face the future. Every business needs to work on the present while focusing on the future due to the going concern factor of every profit-making organization. Without proper financial control and management, it is difficult for business to stand the dynamic environment.
It is normal to feel uncomfortable inviting an outsider to have a look at the private details of your organization. Understanding that financial information is very crucial to every firm, many organizations are adamant to invite external BUSINESS ADVISORY SERVICESto have a look at their books. It becomes close to impossible to trust an accountant if you had a rough past with financial management. However, it is very important to get financial experts to handle your financial information. You will save on money and energy because if your business does not produce tax information it risks being audited. Auditing takes a lot of time and might put your business at risk by damaging reputation. Again you will know where your business stands financially so as to make firm decisions on growth, pricing, and other fiscal decisions.