Modernizing Your Business

Are you up-to-date on the latest tech? Or are you resting on the status quo?

Global modernization is changing business. Businesses constantly try to keep up, but changing and updating your operations can be a daunting task. For more than half of small businesses, the biggest challenge is figuring out how technology will help them.

However, businesses owners no longer have the luxury of choosing whether or not they will adapt to new technology, in today’s high-tech world, it’s adapt or die.
The good news is that the benefits of improving your company’s financial system — even
incrementally — can save you time, money and, ultimately, increase your bottom line.

Three Small Changes Can Help You Update Your Business
1. Automate Tasks
2. Update Software
3. Modernize Expense System


1. Automate Tasks.
You hired your staff members for their brains, not their abilities to complete repetitive tasks. Basic accounting software can help you automate some of your regular payments, reporting, and accounting processes.
Repetitive tasks hold back business.

Here’s how:
A. Wasted Time
Nearly 65 percent of small businesses report having unpaid invoices for more than 60 days. Consider how much time it takes for your staff to chase down those payments, in addition to other repetitive tasks. A business that sends 300 invoices per month, requires about 173 hours of labor. 90% of the cost of invoicing is labor. With automation your staff can put the time they spent on manual tasks toward more meaningful efforts.
B. Long Payment Cycles
Small businesses typically receive payment slowly, mostly because they’re slow to invoice due to the monotony of the process.


2. Upgrade Your Software
Most smaller companies manage their financial systems in excel or with basic accounting software . However, as your business grows, so do its financial needs.
Using an outdated financial management system comes with costly risks, including:
1. Competitive disadvantage:  Your competitors are benefitting from more efficient modern software.
2. Security: You’re more prone to security breaches and expensive recovery costs if you’re using outdated software.
3. Time Loss: Software automation reduces labor costs by about 50%. That’s time that could otherwise drive business forward.
4. Errors: According to several studies, nearly 90% of spreadsheets contain mistakes.

3. Modernize Expense Management
The traditional process for filing expenses involves far too many people and too many moving parts. Employees use petty cash doled out by the company or spend their own money; then they turn in receipts and reports; then a supervisor has to approve the report, and the finance department then processes the request. Finally the employee is reimbursed, taking an average of one to three weeks.
Across the board, employees loose receipts, miss submission deadlines, carry debt on personal credit cards until reimbursement, and unintentionally exceed spending limits. As your company expands, the traditional process reduces your control and visibility of real-time cash flow and creates many inefficiencies.

Hidden costs include:
Wasting money: According to the Aberdeen Group, an average expense report costs $29 to process. If your company processes between 10-15 expense reports a month, that’s nearly $3,500-$5,250 annually in paid staff time.
Employees Penalized: Lost receipts, forgetfulness or lack of time, lead approximately 50% of employees eating an expense rather than filing a report.

Tied Up Credit and High Interest Rates: If you provide company credit cards to your employees, you’re likely paying between 14%-18% interest rate on balances, and tying up the total credit afforded to your business.


Conclusion
When modernizing your business, consider Divvy’s free spend management platform to help save time, increase cash flow, provide real-time data, improve expense-related decisions, reduce costs, and decrease risk of fraud.
Divvy is the first free and fully automated spend management platform dedicated to helping your company spend smarter. To learn how you can save time, money, and frustration managing your spend and expenses, contact Divvy at 877.77.DIVVY, visit www.divvypay.com, or email us at info@divvypay.com.

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I am discussing all kinds of business and finance topics on this blog and I hope that the information I provide will prove to be useful.