Vikas Panchal, Business Head at Tally Solutions provides his insights on how to monitor key business aspects for planning a better and sustainable future.
Running a business is no mean feat. Business owners are preoccupied with a range of day-to-day concerns, from mundane to the mission-critical, dealing with a myriad of issues that might affect the organization and its mission and objectives.
In this sea of everyday challenges, it is easy to lose track of the key business priorities. To be able to sustain success and take the business to new heights, the business owner should keep tabs on critical changes to sustain the organization’s relevance in an over-competitive and ever-evolving market landscape and consumer demands.
Of these changes, the most critical one is being fully aware of the financial health of the business. The business owner needs to be on top of his sales revenue, gross margin, monthly profit or loss, overhead costs etc.to take any important decision for the business. The availability of cash is a key aspect that can make or break a business. Hence, effective cash flow management is pivotal for the business to avoid cash crunch issue; ensure provision for future investments and expenses and guarantee timely recovery of receivables from debtors.
An accurate cash flow projection gives the business owner confidence to make commitments, fulfill all the obligations to suppliers and tax authorities, and finance relevant expenses. This way, one can save by avoid paying interest, penalties, and other similar unwanted and unnecessary expenditures. Keeping a close watch on the finances is crucial to measure the capability to timely meet customer demands as well as determine future business requirements.
Another key factor that determines the profit and losses for the business is proper inventory management. Knowing the current status, future requirement, aging of all the stock, which one makes the maximum benefit, and which need to be stalled are some of the answers that should be clearly understood in order to run a successful business.
While traditionally, these things were done manually, with the advent of technology, it is just a matter of a click. Business management software provides this information with the utmost accuracy and speed and can be a boon to increase business efficiency significantly. Many advanced software programs are available in the market today to help companies manage their cash, stock, and tax effectively.
A complete understanding of the market scenario, competition landscape, customer preference, and industry developments also become key in planning the roadmap for the business. These internal and external factors with great impact on the business should not catch one off guard as they may have detrimental effects. Hence, a complete overview of these will help plan for the future in a much better way.
(Written by Vikas Panchal, Business Head at Tally Solutions in the Middle East, a leading international accounting and compliance software provider)