Poultry growers love talking about chicken, but let’s address the importance of managing your business expenses. You probably got into the poultry industry to provide for your family, make some money and retire someday. To be successful in your business, you must be a hard worker and passionate about what you do. There are various other factors that will determine success, such as tracking your expenses and setting aside funds for both your personal and business needs. Let’s discuss some of the best practices in budgeting for your farm that will allow you to set and achieve attainable goals.
Organize A Work Space
As a business owner, there are steps you must take to ensure that things run smoothly. First, take the time to set up an organized work space. It is very time consuming and frustrating when you are unable to find your checkbook or a copy of a bill. Create a filing system that you are comfortable with so you will stick to it. It may be as simple as having a tray for all incoming mail and invoices. Pick a day of the week to work through those items. You may have a second tray for items labeled “to pay.” Open the mail weekly and place items that need to be paid there. Write on the calendar when items are due and see if it is sustainable to pay your bills bi-weekly. These simple steps will help you to manage your time better and enable you to keep track of expenses.
Keep Business and Personal Expenses Separate
It is important not to mix business with personal expenses. Create a bank account for only business related items and use it to write yourself a “paycheck.” Set up a personal account and deposit your paycheck into that account. Next, pay all personal expenses like your mortgage and electric bills.
It is critical to know where money is coming in and being taken out. When a deposit goes into the bank, do you know how it got there? Was it a payment from a flock that just left the farm? Again, the more organized you are, the easier the accounting will be at tax time. Initially, these steps may sound like a lot of work, but this is the foundation of being successful. It will be easier for you in the long run if you have to go back and find something.
Keep Up with Your Taxes
Having your taxes prepared on time will save you the hassle of backtracking to find expenses and receipts. If you take your accountant a box of receipts and bank statements, your return is going to be more expensive than someone who presents the accountant with a detailed profit and loss statement. If you need assistance with tracking your expenses, we suggest using a bookkeeping service, such as Quickbooks, that will allow you to keep a detailed summary of all money that comes in and out of your business throughout the year.
There are many ways to keep your business organized. All of these practices will aid you in becoming more diligent with expenses and ultimately be more successful.