How to Avoid Outgrowing Your Financial Practices

by Erika Napoletano

Business is moving along. You’re happy with your company's growth. The company culture is healthy, and your employees (mostly) like one another. Everything looks fantastic — on the surface, that is. But have you checked in with the financial side of things lately?

As a business grows, existing banking, accounting, and payables and receivables processes are often overtaxed. How can you keep the business running efficiently and growing effectively? The following experts weigh in on how to ensure that financial practices keep pace with growth.

Assess the “Branches on Your Tree”

Consider your business a tree. The trunk is the foundation, and the branches are all of the different departments that make your business run each day. When you look at the financial branch, how many branches are growing off of it? Too many?

Growing businesses often find themselves tacking on more and more technology solutions in the hopes of wrangling their financial needs. But smart businesses run only as much financial software as necessary. They also reconcile all of the necessary branches into one main location on a regular basis. The fewer moving financial parts you have, the fewer chances there are that money will get lost or numbers will be miscalculated.

Think about it: Do your business finances look like the equivalent of a shoebox filled with receipts? If you're running spreadsheets, accounting software, a merchant services account, and a petty cash fund out of a box in someone's desk drawer — with none of it reconciled to a single digital location — the answer is yes. Consolidation of your financial data can lead to both sanity and profitability.

Get a Second Opinion

In addition to performing your own financial health check, it can pay (sometimes literally) to have a second pair of eyes on the situation.

You might enjoy a long-term relationship with a trusted financial partner like a CPA or bookkeeper (or, hopefully, both). They know your business inside and out. There are benefits, however, to having another set of eyes on your situation, according to Scott Gregory, a career CPA and CFO, and founder of Better Bottom Line, a company dedicated to helping businesses straighten out their finances. These include:

1. More comprehensive tax preparation: Different CPAs handle tax time differently. Having two different people involved in the process can uncover deductions and other savings that one person might not have found on his or her own — especially for a company that is growing and changing quickly.

2. Protection from inexperienced or subpar financial services providers: Let's face it: some people are just better at their jobs than others, and, when it comes to financial services, there's a lot riding on the people who you are working with to keep your business processes running smoothly. A system of checks and balances can prevent your company from falling victim to accounting and bookkeeping practices that could put the future of your business in peril.

3. Deeper knowledge: An outside financial professional can review your current business processes and arm you with questions to take back to your regular accountant and/or bookkeeper. More productive conversations with the people you know and trust are never a bad thing, and can prepare you to sustain even greater growth.

Talk with Your Bank

How often do you sit down with a real, live person at your business's bank? Greg Ellis, owner of Ellis Bottom Line Bookkeeping, in Longmont, CO., encourages his clients to have regular, face-to-face conversations with their banks.

“Bring documentation that illustrates your company's financial history along with your plans for the future,” said Ellis. Your bank liaison can advise you on such issues as whether you’re using the best deposit accounts and taking advantage of all the products and services that suit your company’s financial needs.

You may well find that your bank offers reasonably priced services you never even knew about, including payroll, tax payment, business lines of credit and business credit cards with flexible repayment terms. All of these services could potentially help your growing business streamline its processes, as well as provide the means to fund your next big growth goal.

About This Author

Erika Napoletano

Erika Napoletano is an author, columnist, speaker and branding strategist, hailed by Forbes as a “spinless spin doctor.” She's a twice-published author, including The Power of Unpopular (Wiley 2012), a columnist for American Express OPEN Forum, an acclaimed speaker from TEDx Boulder 2012, and speaks at conferences across the U.S. on the inherent power of truth in business… or as she refers to it, the power of unpopularity.


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