Solve SMB Cash Flow Management Problems With the Right Technology

As an accountant, you work closely with your small business clients to manage their bookkeeping and to help guide them through tax season. While you may do your job perfectly day in and day out, many of your clients still face cash flow problems. And all too often, small business owners fail to notice these cash issues until it’s too late.

What you can you do as an accountant to help your small business clients better manage cash flow problems and remain strong and healthy? Implement proactive advising services, and use the right technology tools to aide your clients.

Why Cash Flow?
According to Dun and Bradstreet, cash flow problems cause 90 percent of small business failures. What’s more is that 60 percent of small businesses that fail in America, were actually profitable at the time, but just ran out of cash. When these issues are not spotted early enough, they can be fatal for even the most diligent small business owners.

Small business owners are typically not very good at understanding the difference between profits and cash. Generally, entrepreneurs are in business because they have a passion for their product or service, not because they have an interest in accounting or financial management. And as an accountant, you’re there for them to manage taxes and audits, but are often separated from the strategic financial analysis that all small business owners should be doing daily.

Isolated Technology
Most small business owners employ an someone to manage their books, use an accounting tool like QuickBooks and monitor their bank account with technology provided by their financial institution. But all of these tools operate in isolation, making it difficult for small business owners to get a full picture of their financial health. Also, these tools typically provide a history of financial information, but do not help a small business owner predict cash flow, or plan for what sort of capital they need as they grow their business.

To make matters worse, many small businesses operate without a CFO or someone who understands how to monitor financial health and properly forecast to spot cash flow problems early. And while small businesses typically work with both accountants and banks, they generally do not receive proactive financial advice and analysis from these institutions.

Dashboards, Dashboards, Dashboards
Barlow Research found that almost  two-thirds (63 percent) of small business owners said they would consider using new technology to help them manage cash flow. They’re also willing to spend more on improved technology. A recent Palo Alto Software study found that almost half (48 percent) of small business owners are willing to invest over $5,000 in new technology this year. While small businesses are willing to spend more, most are unaware of the best tools available.

Offer your small business clients cloud-based tools that integrate with financial data to help them better understand their financials and spot cash flow problems before it’s too late. There are dashboards that display financial information in the form of graphs and charts and make it easier for small business owners to track key performance indicators, set goals and forecast. reccomend the right dashboard and strategic planning tools, and then step in to provide more than tax, audit and bookkeeping services. You have access to their financial information and are in the position to offer them more strategic advice to ensure that they avoid cash flow problems. If you’re able to better serve them year-round to keep the business healthy, they’re likely to continue to work with you, and pay you more,  as they grow.

Managing cash flow doesn’t need to be so difficult. As an accountant, you’re an expert in helping businesses of all sizes manage taxes and audits, but you’re also in the position to help SMBs avoid detrimental cash flow problems. Cloud-based small business financial dashboards can help strengthen this relationship by giving you and your clients access to a tool that provides the information you both need to properly track cash flow problems and work together to find a solution.