How to Start Your Business the Right Way

If you're in the beginning stages of starting a brand new business, you may not need a bookkeeper right away. But there are certain things you should do as soon as possible to avoid becoming a scrambled mess later on.

Open a business bank account

Starting off with the most important one, it is crucial that you separate your business transactions from your personal finances right away. It doesn't even have to be labeled as a business account, just as long as it's a separate bank account that is used only for business. The same goes for credit card accounts too. A credit card account for a business should only have business transactions on it and vice versa.

Once this is done, you'll need to get in the habit of making sure you use the correct account for every purchase you make. Of course, there will likely be the occasional slip up when you accidentally use the wrong card, but as long as you keep those two sets of finances as separate as possible, that is what's important. If you're not going to invest your time or money into bookkeeping yet, at the very least, get a separate bank account for your business. You'll be glad you did.

Set up a digital filing system

I know it's tempting to drop all of your receipts into a shoebox to deal with later, but when it comes time to face the music, you'll wish you'd done it differently. What every business owner needs is an easy way to digitally capture receipts and organize them so that they can quickly be found at any given time.

One big problem with the "shoebox" system is that you'll not only have a mess of paper, but this doesn't even include all of the receipts in your email inbox. Even if you print them all out and stuff it into the box, you're still left with an unorganized paper stack to sort through whenever you need to find something. This is why it's best to have a digital filing system.

If you have a Quickbooks Online subscription, I would recommend using their mobile app to scan receipts so that they can be attached to transactions right in your bookkeeping. They also have a feature that allows you to forward receipts in your email, which sends it straight to Quickbooks. You can read more about that system here.

There is also the option to use a cloud storage app like Google Drive or Dropbox. If you log into the storage app on your phone, you can easily snap a photo of a receipt and add it to your drive. As long as you also have access to your emails on your phone, you can add the attachments to your drive. This is not only a super easy way to get everything into one place, but you really don't even need to spend time organizing it if you don't want to. Most of these apps have search functions that make it easy to find what you're looking for.

Know your profit every month

Until you're ready to hire a bookkeeper, you'll still need a way to know if you're making a profit. Whether it's keeping track of sales and expenses on a spreadsheet or even on paper, it's important to not operate blindly. Compare your bank statements with your own records to make sure nothing gets missed. Of course, you won't get in-depth reports showing exactly where your money went like you would get if you had a professional bookkeeper in your corner. But at the very least, you should be able to know how much your business made versus how much it spent when each month is over.

If you make sure to do all of these things, you should be in good shape until you outgrow the "baby" business phase. Set up your systems as early on as possible, stay consistent with them, and before you know it, you'll be ready to invest in a pro that will take these systems to the next level!