SMB Accounting
Most small businesses don't close from bad luck but from the same seven avoidable mistakes. Spot them in time and you remove much of the risk.
Runway, P&L, treasury and CFO advisory in real time. No Excel. No headaches.
Create a free accountMost small businesses don't shut down because of bad luck or because they sell too little: they shut down because of money-management mistakes that could have been avoided. The frustrating part is that it is almost always the same seven, and you don't need to be an accountant to dodge any of them. Spot them in time and you take a big share of the risk out of going under.
The root mistake, the one many others grow out of. If the same pocket pays the supplier and Friday night's dinner, you will never know whether the business is making money. How to avoid it: a separate account, a fixed salary for the owner, and every transaction tagged. I cover it in detail in separating your personal and business finances.
"I'll write it down later" is the phrase that kills a small business's books. What you don't record on the spot gets forgotten, and what gets forgotten is almost always cash expenses — the ones that throw your numbers off the most. How to avoid it: one expense, one entry, on the spot; pick a tool where recording takes seconds, not minutes.
Sending an invoice is not the same as having the money. Many businesses feel prosperous because of what they have invoiced while their cash dries up because customers pay late. How to avoid it: keep an eye on what you are owed and when the money actually comes in, not just what you billed. It is the core idea behind a 90-day cash flow forecast.
Selling a lot is not the same as earning a lot. If you don't know how much it costs you to produce what you sell, you can be growing sales while losing money on every one. How to avoid it: know your margin. Start with what gross margin is and learn to read your Income Statement.
An expense without a receipt is, in practice, an expense that doesn't count: money overpaid in taxes and a month-end close done blind. How to avoid it: snap a photo of every receipt on the spot, with everything in one place. The method is in how to organize your invoices and receipts.
Spending 100% of what comes in and then getting hit with the tax bill is a classic that drains the capital of otherwise healthy businesses. How to avoid it: set aside a percentage of every payment as soon as it comes in, as if it had never been yours. Your tax advisor sets the exact percentage; you set the habit.
The silent mistake. Recording without looking is like stepping on the scale and never reading it. Without a review there are no timely decisions, just nasty surprises at the end of the month. How to avoid it: ten minutes a week looking at cash, receivables and margin. That ritual turns record-keeping into control.
Record over WhatsApp, separate business and personal, keep every receipt and see your numbers whenever you want. 7 days free, no card required.
None of these seven mistakes is sophisticated, and that is exactly why they are so common: they creep in through routine, not ignorance. Separate the money, record on the spot, tell invoiced from collected and sales from profit, keep your receipts, set money aside for taxes and review every week. Avoid these seven and you are already managing your business better than most.
Want the positive method — what to do, not just what to avoid? It is in how to keep the books for a small business.