Financial Planning and Analysis for Small Businesses—What It Is and Why You Should Care

Running a business is tough. There’s no bones about it.

In fact, most business owners wear just about every hat you can imagine. Sales rep, marketing expert, customer service representative, and more. And unfortunately, the to-dos don’t end there.

Because at the end of each busy day, month, quarter, and year, there are the company finances to reckon with. And that’s where many small business owners simply hit a wall.

If that sounds like you—and you’re unsure of whether or not you’re even turning a profit until tax time rolls around—this article is for you. You’ll learn about something called financial planning and analysis and why it just might be the secret weapon your small business has been missing all along. 

Let’s break it down.

The Problems with Not Being a Spreadsheet Nerd

Here at Integro CleanBooks, we’re a bunch of spreadsheet nerds. But as for the many clients we serve in the construction, manufacturing, and service industries? Well, not so much.

Because of that, we tend to see a few common mistakes in our favorite business owner’s books. Such as…

• Lack of a clear budget or spending plan
• Not having enough cash for payroll or inventory
• Difficulty pricing products and services
• Reactive finances (instead of proactive planning)

Unfortunately, this is the cause of a lot of financial stress. However, there is a way out. All you need is a bit of financial clarity. And with that, you’re better able to plan ahead, make decisions that support a healthy business, and serve your clients more fully. 

Here’s how.

Gaining Financial Clarity with an FP&A Analyst

When it comes to finances, many business owners need a helping hand. This is where a financial planning and analysis expert comes in. 

An FP&A analyst’s job is to make sense of your finances and then turn those insights into an intelligent business plan. And the good news is you may not need a full-time hire to reap these benefits. In fact, many small businesses do just fine with external consulting, part-time hires, or even employing a bookkeeper with FP&A training. 

However, before asking your accountant if they’re up for the task, it’s important to understand the differences between FP&A and accounting. That way, the two of you will be able to make a more informed decision that serves everyone involved.

• Accounting deals with reconciling the past (what has happened)
• FP&A is about using past insight to look forward and plan for what could happen

Both are essential for running a financially sound business. However, most companies lack financial foresight. So if you’re ready to start creating plans and budgets based on facts and figures—rather than gut feelings alone—it might be time to add FP&A to your financial arsenal.

The Power of FP&A Software for Small Businesses

If you’re ready to gain the insights of financial planning and analysis, but are more of a DIYer, you have another option.

FP&A Software for small businesses.

These modern software are affordable, easy to use, and available to just about any business owner willing to take a bit of time to learn the platform. With the right tools, you can build forecasts, manage cash flows, and run “what if” scenarios to plan for different outcomes.

Here are a few things basic FP&A software is capable of. If you’re interested in learning more, check out a list of the most popular options here.

• Track financial performance in real time
• Build monthly, quarterly, and annual budgets
• Run cash flow projections
• Set and monitor KPIs
• Make strategic financial decisions

Better Budget Planning for Businesses

While the fact remains that most small business owners aren’t making daily decisions based on hard numbers, it’s important to understand that it doesn’t have to be that way. In fact, getting your finances in order is easier than most business owners think.

So don’t let messy financials hold your business back. At CleanBooks, our financial experts help small business owners gain clarity around their finances, helping them move forward with confidence and run their business with financial peace of mind.

If you’d like to discover what that might look like for you, give the CleanBooks team a call. Our financial experts are ready to run the numbers and help you move forward with a solid plan and financial clarity. So don’t let messy books hold your business back any longer.

Instead, move forward with a free call and complimentary consultation today. 

Talk to an Expert.