The benefits of hiring a financial consultant for your home building business are many. Leave the time-consuming analysis and strategizing to experienced professionals and reap the rewards of having everything under control
It’s difficult to maintain a successful business, no matter the sector. Data from the Bureau of Labor Statistics show that 20 percent of small businesses fail in the first year, and 50 percent fail after just five years.
But 36.4 percent of young construction companies fail in the first five years, according to Small Business Trends, which is the lowest rate across data from eight different industries. It’s no secret that many of these companies are failing because they can’t get a grip of their cash flow. With rising construction costs and an uncertain housing market, there are many financial factors that contribute to a failing business.
Working with a financial consultant outside of the business who can evaluate cash flow and create a sustainable business plan can keep your bottom line growing. Here’s why hiring a financial advisor could be the most important thing you’ll ever do for your business.
They do this for a living
While it may sound obvious, remember that the job of a financial advisor is to help you solely with finances, and many of them work with specific industries. You may believe that you don’t need help, that you’ve been doing this long enough to know how to manage cash flow. But think about all the time you spend doing other things, from hiring and firing to coordinating schedules and paying taxes – financials may not be getting the time and attention needed to continue growing your business.
This is why a consultant can really turn things around. Their sole focus will be to get your business on track and to create a plan that works for you to maintain while increasing profit.
These professionals will be able to analyze every aspect of your business, uncovering things that have gone unnoticed, or revealing easy ways you can save on expenses. This will improve your cash flow right away, and you’ll start seeing what you thought were necessary expenses in a new light.
Because your emotions and personal goals are likely tied to the company you’ve built, it’s important for an objective third party to take a look at operations once in a while. This also opens up a lot more time for you to focus on clients, vendors, employees, and anything else that arises throughout the day. Only then can you give your business the attention it needs to expand.
Tax and audit assistance
Small businesses often pay hundreds of dollars in tax penalties each year. For example, the IRS says that 40 percent of small businesses pay a payroll tax penalty each year for not depositing withholdings or depositing the wrong amount, or just filing taxes incorrectly. These expensive penalties could be easily avoided with professional tax help.
In particular, hiring a CPA is a good idea because CPAs can represent your business if the IRS audits you, unlike other financial professionals. CPAs can also ensure that you don’t violate any tax laws leading to penalties, and they can set up an audit plan for the future.
Managing tax payments and audits are complicated and time-consuming. By hiring a financial advisor to be on your side through the process, your business will be set up for success, not to mention tax savings. These professionals will also be able to handle much of the tedious paperwork that you just don’t have time to handle properly.
You’ll learn a lot in the process
Hiring a financial advisor can provide many benefits to you and your business even after they’re done with a given project or goal. These professionals consult with you and offer advice for future strategies that you wouldn’t be aware of otherwise. Not only will your business plan and cash flow improve, but you’ll learn a lot in the process and thus become a better problem solver for future issues.
Experts in the industry
The housing market is always changing, and builders can feel the biggest blows when the wind shifts. Some financial advisors and CPAs work exclusively with construction companies and home builders to provide the most expertise out there in these industries. These professionals can see upcoming risks and help you adjust your business plan accordingly, and they can offer advice based on what the market is doing.
Financial professionals and CPAs can also make sure that your business is following each and every tax code and law change that you may not have the time or resources to be aware of. They’ll understand how changing regulations can affect your business and update your plan accordingly.
There’s never been a better time to work with a financial advisor to get your business plan back on track. Hiring an experienced CPA may be the single most important thing you ever do for your business.
To learn about the variety of financial services that No Boundaries Advisors offers, get in touch with our experienced team of CPAs, tax planners, and compliance experts.