Financial Management for a Small Business

Abstract

Financial management is crucial for a small business because it ensures that resources are used effectively, cash flow remains stable, and the business can sustain operations and grow. Good financial management helps owners make informed decisions, avoid unnecessary debt, and plan for both opportunities and challenges. Key activities include budgeting, monitoring cash flow, managing expenses, maintaining accurate financial records, forecasting future financial needs, and evaluating profitability. It also involves ensuring timely payments, controlling costs, setting financial goals, and reviewing financial statements regularly. Together, these activities help small businesses stay financially healthy and resilient.