We recently came across a great article by Jay Goltz, contributor to The New York Times’ “You’re the Boss” blog: “The Top 10 Reasons Small Businesses Fail.”
As you’d expect, it’s a pretty sobering list. We encourage you to read the full article; however, we’ve also snipped (with Jay’s permission!) a reason that’s near and dear to us…
Poor accounting. You cannot be in control of a business if you don’t know what is going on. With bad numbers, or no numbers, a company is flying blind, and it happens all of the time. Why? For one thing, it is a common — and disastrous — misconception that an outside accounting firm hired primarily to do the taxes will keep watch over the business. In reality, that is the job of the chief financial officer, one of the many hats an entrepreneur has to wear until a real one is hired.
Now while poor accounting can spell disaster, good accounting can help a new company really find its groove and operate efficiently. Form good accounting habits early, and you’ll be well ahead of the game!