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Many business owners may not realize how truly important paying bills on time is to their entire business says outsourced CFO. While in fact, in a business owner gets into the habit early on of forcing themselves to pay their bills on time, it allows them to ensure that they know that their business is profitable, and that will serve them well when they scale up the business.
One problem that business owners often do not realize they have says outsourced CFO, is they think that they can delay paying their bills on time until they grow their business large. However, it is very important for people to realize that if they do not have a profitable and sustainable business while they are small, when they scale up, all they are doing is scaling up the problem. By not being able to pay bills on time, when a business owner scales up their business, there scaling up an unprofitable business, which will eventually collapse. Since 29% of all failed businesses run out of money as the reason why their business failed, makes it the second most common reason why businesses fail. Business owners who scale up unsustainable businesses find themselves failing due to this reason.
In fact, business owners need to understand that if there able to pay their bills when they are small, that will force them to ensure that they have the money to do so. Whether that means that if they are unable to pay their bills they go out and find new revenue. Or that might mean that they cut expenses says outsourced CFO. But doing both of these things is very important to ensure that business owners will be able to figure out how they can ensure that they are paying bills on time while they are small. Therefore, when they scale up their business, they will scale up the ability to continually pay business bills on time.
Another reason why business owners need to pay their bills on time, is because their staff will follow the business owners lead says outsourced CFO. And while their staff will not be responsible for paying bills, by having a company culture of avoiding obligations, the team is going to follow suit. By the business owner avoiding their obligations, means that staff will avoid their own obligations such as not meeting deadlines, even terrible customer service, and generally not doing a good job on their tasks. This sort of culture is going to end up destroying a business, therefore business owners need to ensure that they are running their business ethically and meeting all of their obligations, so that they can build a culture that is going to allow them to succeed on all levels.
Business owners need to ensure that they are paying their bills on time, and by getting into the habit early on, they can ensure that they are going to have a sustainable business for a long time. This is going to serve them well, and allow them to be successful.
Business owners who are not paying their bills on time are actually putting their business in jeopardy and they do not even know it says outsourced CFO. Ultimately, if business owners are not able to pay their bills on time, it means that they are either not generating enough revenue, or they have unsustainable overhead. And while business owners believe that their key is to grow larger, it actually is not. Business owners need to figure out how to be profitable and sustainable small, so that as they grow, their profitability and sustainability can grow as well.
Business owners need to ultimately understand that it can be extremely difficult for their business to manage if they let debts pileup. In fact, outsourced CFO says that it is almost impossible for businesses to withstand piled up debts. Because it can put a business owner in a position of being worse off than a brand-new entrepreneur. By not being able to pay all of their bills, each month, a business owner falls farther and farther behind, and becomes less able to pay all of their bills overall.
One thing that business owners need to realize, is that when they stop paying their bills on time, it is only a matter of time that they stop paying some of the more important bills such as taxes. In this is especially bad says outsourced CFO, because Canada revenue agency is very ruthless in collecting on the taxes that are owed. Canada revenue agency is literally able to go directly into an entrepreneurs bank account and take the money directly out of it. Or even sees the bank account or freeze it. Therefore, business owners will find themselves in a much worse position if Canada revenue agency is owed taxes.
In addition to that, the owners need to realize that if they miss their payroll remittances, that will be especially bad, because those penalties are the stiffest that Canada revenue agency hands out. Outsourced CFO says that business owners who paid to little payroll remittances or they do not pay them on time will find themselves not only being expected to pay all of the remittances back that they owe immediately. But also Canada revenue agency will also slap them with a 20% interest charge on the entire amount that they owe. While many business owners will see 20% being as bad as a high interest credit card, they need to understand that this interest is going to be accrued her day. Literally turning a thousand dollars and twelve hundred dollars overnight. This can be impossible for business owners to recover from, making it very important that they get into the habit of paying everything on time early on in their business.
Ultimately, business owners need to ensure that there paying their business bills on time all the time says outsourced CFO. Not only will it help ensure that they can have a profitable business, but it is going to cost a business owner far more than they realize to not pay their bills on time. It will cost them their relationship with their suppliers, it will cost them their good reputation, and ultimately it will cost them customers, when they realize the business is not conducting themselves ethically. Therefore, business owners will suffer a lot more than they realize when they end up not paying their business bills on time. They should get into the habit of doing this early on, and succeed.
