The journey to success as a solopreneur can be demanding. Unlike larger businesses, you wear every hat imaginable – from marketing to operations to financial analyst to administrative assistant. The weight of your startup success rests solely on your shoulders, so it’s key to have both the grit and determination and the technology and tools needed to meet every decision and challenge head-on.
Despite the challenges, solopreneurship can also be exhilarating. As your own boss, every win and penny earned is due to your prevailing dedication, making owning a business a rewarding career and a powerful contributor to the U.S. economy. This has led to nearly a quarter of U.S. consumers (23%) considering starting a business in 2024, according to a recent survey commissioned by Intuit QuickBooks.
No matter what stage you’re at as a solopreneur, a key to success is effectively managing cash flow. With the right processes and tools in place, cash flow can be less of a burden. You can have the visibility and insights required to take action when needed and feel confident in your business’s trajectory while freeing up time to tackle the gamut of other tasks on your plate. Here are three cash flow tips for every solopreneur.
Know where your business finances stand
Whether you’re a seasoned solopreneur or just starting out, understanding your business finances should be your number one priority. Make sure you’re allocating time to review your cash flow statements on a regular basis to ensure you know how much money is coming in and how much needs to be allocated to cover expenses. Understanding your business’s whole financial picture can help you make informed decisions to anticipate potential challenges so that no matter what comes up, your business can move forward.
Utilizing reliable financial software can be helpful in making sure an updated picture of your business finances is at your fingertips so you can maintain focus on what matters most – running your business.
Use cash flow insights to build informed projections
With a cash flow statement’s real-time look at how much money you have on hand, you’ll be in a better position to develop cash flow projections that enable you to account for future income and expenses, and predict the amount of money flowing through your business at any given time. And the good news is, you no longer need to rely on paper and pencil for this – digital tools like QuickBooks can forecast money in and out, all from one place. With up-to-date insight, you’ll be better positioned to identify a clear roadmap to effective cash management, identify potential late payments or spending anomalies, and ultimately prepare for potential cash flow gaps.
Understand alternative financing options for potential cash flow shortfalls
Even the most experienced businesses can have a cash flow shortfall, so understanding how to tap into funding to bridge any gap is critical. Using credit cards for financing is on the rise – 81% of solopreneurs currently use them, mainly as an emergency or temporary source of funding.
But accessing capital is not a one-size fits all, and credit cards are just one option. Other alternative financing options can help you gain access to the resources you need to thrive, including invoice financing, a line of credit, and loans. With alternative lenders, such as fintech platforms, you may benefit from a simpler application process, fast decisions, flexible qualification requirements, funding limits that fit your business size, and quicker access to funds. To mitigate cash flow struggles, explore reputable leaders in the lending space or consider using a financial management solution that offers integrated lending capabilities to help your business get paid faster and strengthen your connection to the working capital you need.
Interest in solopreneurship is at an all-time high, but it’s no easy feat. It takes resourcefulness and resilience to start and build a small business. If you’ve already got the gumption to dive into entrepreneurism, these tips can help you take control of your cash flow today and set your business up for future success.
Rob Daniel is the Director of Product Management, Intuit QuickBooks.
This content, report and materials are for informational purposes only and should not be considered legal, accounting, financial, investment, or tax advice, or a substitute for obtaining such advice specific to your business. Additional information and exceptions may apply. Applicable laws may vary by state or locality. No assurance is given that the information is comprehensive in its coverage or that it is suitable in dealing with a customer’s particular situation. Intuit Inc., or its affiliates do not have any responsibility for updating or revising any information presented herein. Accordingly, the information provided should not be relied upon as a substitute for independent research. Intuit Inc., or its affiliates do not warrant that the material contained herein will continue to be accurate nor that it is completely free of errors when published. Readers should verify statements before relying on them.
We provide third-party links as a convenience and for informational purposes only. Intuit Inc. or its affiliates do not endorse or approve these products and services, or the opinions of these corporations or organizations or individuals. Neither Intuit Inc. nor its affiliates assume responsibility for the accuracy, legality, or content on these sites.
Solopreneur stock image by WESTOCK PRODUCTIONS/Shutterstock
