Looking to Drive Revenue Growth During a Time of Inflation? Focus On Your Numbers

After the Great Recession of 2007-2009 finally ebbed, businesses enjoyed more than a decade of robust economic growth and relatively low financial volatility. But that all changed in 2020, when a global pandemic and growing geopolitical uncertainty decimated supply chains, triggering an inflationary spiral that’s still being felt in many areas today.

These Inflationary pressures have only added to the formidable challenges already standing in the way of revenue growth and profitability. If your organization’s going to overcome those hurdles, you need to be laser-focused on the numbers.

Accounting Matters, Especially Now

While robust accounting operations are essential in any economic climate, financial functions are especially crucial when inflation threatens to block your path to growth.

If you’re not focused on the numbers, budgeting becomes impossible, and you’re left without the tools needed to realistically forecast revenue and growth or reliably calculate profits. By closely tracking and monitoring transactions and ensuring the accuracy of your financial statements, accounting operations also play a critical role in preventing fraud, and they ensure your organization remains in compliance with local, state, and federal regulations.

When your financial functions are firing on all cylinders, you’re also better positioned to gauge your organization’s overall health and efficiently manage the infrastructure on which your business runs. Solid accounting operations are also critical for raising capital from investors and lenders, maintaining strong relationships with suppliers and vendors, and making strategic decisions based on data and facts rather than mere assumptions and hunches.

A Path to More Robust Accounting Operations

So what should you do to ensure your accounting operations and financial functions are optimized for these inflationary times?

Be Sure You Have the Basics Covered

Basic accounting functions may not be glamorous, but they’re essential to managing and maintaining a healthy cash flow and ensuring the overall health of your business:

For example, your accounting team should reconcile accounts payable and accounts receivable to your statements of financial position and your balance sheet at the end of every month – not all at once at the end of the fiscal year. They should also have workflows established that ensure efficient issuance and tracking of invoices and a system in place to collect from slow-paying or delinquent accounts.

A workflow for paying your taxes – early if possible, on time at the very least – will also prevent your organization from incurring costly late fees and penalties or becoming mired in a potentially disastrous audit.