Regular expenses relate to standard business activities that occur each year, such as conference attendance, advertising and marketing spend, or the office Christmas party.
Projecting cash flow for the full year allows you to get ahead of any financial struggles or challenges.
It can also help you identify a cash flow problem before it negatively impacts your business.
This is essential to understanding your business's revenue and potential costs versus profits of expansion or growth of your output.
Having your expenses fully fleshed out, as described above, will make your break-even analysis more accurate and useful.
Assets and liabilities are the foundation of your business's balance sheet and the primary determinants of your net worth.
Tracking both will ensure you are maximizing your business's potential value.
A profit and loss statement shows how the business performed over a specific time period, while a balance sheet shows the financial position of the business on any given day.
Similar to projecting your expenses, a savvy business owner should be able to predict their cash flow on a monthly, quarterly and annual basis.
Identifying any patterns in your sales cycles will help you better understand your business as well as plan out marketing initiatives and growth strategies.
A seasonal business can aim to improve sales in the former offseason to become a year-round venture, while another business might become better prepared by understanding correlation in upticks and downturns in business due to factors such as the weather or economy.