Knowing the numbers is vital to small business success

2/11/2011

With small business lending practices beginning to ease, many entrepreneurs will be able to focus on expansion for the first time in years. According to Inc. magazine's business expert Norm Brodsky, small business owners should first organize their financials, as this will help them plan their growth strategies.

Brodsky suggests that entrepreneurs purchase accounting software, such as QuickBooks, to help manage their financial information. If they don't have anyone on their staff that can act as an accountant, small business owners should also look into hiring either an employee that specializes in money management or an outside firm.

"The vast majority of entrepreneurs ... find accounting mysterious and daunting," explains Brodsky. "But you really can't know what's happening in your company or make consistently good decisions without mastering the numbers."

Hiring an accountant will also come in critical during the ongoing tax season, as they can help entrepreneurs identify which tax breaks they are eligible for. For example, small business owners who recently began offering health insurance to employees may able to get tax credits as a result.