Recently, the Federal Reserve made the decision to increase the federal funds rate with an intent to continue to raise interest rates. Though higher interest rates may help to curb inflation overall, increased interest rates can cause business owners to face a number of challenges.

As a business owner, it’s important to consistently be aware of metrics that determine the likelihood of your company’s ability to meet its financial obligations, weather an unexpected downturn, or handle a crisis. Generally, the two metrics given most importance are cash flow and working capital, the latter of which will be addressed below.

Measuring your company's profits is a crucial routine process that's necessary not only for reporting purposes, but for prudent decision-making. Keeping track of your profits will allow you to optimize your pricing models, know which products and services to focus on, prioritize functions of your business, and generally have a better grip on managing your business.

Capital budgeting is a highly powerful financial tool that can help business owners analyze and justify investments, allowing them to assess potential risks and rewards and make more prudent decisions. Capital budgeting is important, as it provides defined metrics and measurability for the project’s value.

In the same way that individual consumers have to build and manage credit, businesses have credit history and scores that can either enable or inhibit decisions and growth initiatives. Often, small business owners fail to separate their business and personal finances, which can put the business at unnecessary risk.

The more financial visibility, controls, and planning you have within your business, the better. Financial plans help to guide decision-making within your organization, and comparing forecasts to actual outcomes provides crucial data about the overall health and efficiency of your business.

Poorly managed finances are the reason why more than 82% of businesses fail. This troubling figure from the U.

Your company works hard to provide an excellent product or service to clients, so it’s crucial for your invoicing system and processes to allow you to accurately and consistently receive payment. Invoicing is a foundational component of your business.

It’s likely that your end-of-year and beginning-of-year planning led you to analyzing your business’ performance and setting goals for the new year. However, it’s crucial to have a strong foundation of key performance indicators to be able to measure those goals, ensuring that your business meets its objectives in 2023.

A business audit—be it internal, external, or from the IRS—can be a stressful experience for unprepared business owners. However, audits are excellent tools for an organization to both provide necessary information to external stakeholders as well as to gain further insight into internal financial reporting and operational processes.