The changing conditions of 2020 demonstrated how important vision and preparation are for businesses. Seeing what is coming early can turn challenges into opportunities. That difference can make or break a new venture, especially when owners are investing so much energy into the small-scale efforts that drive early growth. Here is a short list of trends in accounting to help startups stay ahead of the curve in 2021.
The increase in remote work has accelerated a long-term shift towards cloud-based accounting solutions. This means accounting software and data are stored on remote servers, not locally. Cloud accounting systems allow multiple people to collaborate on the same file without the need to install new software or regular upgrades and remove the need for tedious manual backups. In a traditional accounting system, the delay from entering new information to seeing it reflected on a report might just have been an hour when everyone was in the office; with people working remotely, that delay could be days. As remote becomes the norm both for employers and employees, now might be the perfect time to switch to software that allows for that transition.
Access to timely data is no longer an expensive luxury limited to larger companies with technological improvements like cloud accounting systems. Even the smallest startups can take advantage of this resource in a variety of ways. Useful examples might be understanding which product lines are most profitable, observing changing customer preferences, or examining real-time cash flow numbers for purchasing decisions. Data analysis is an opportunity to understand what is happening now and what might happen in the future. If you frequently find yourself without access to pertinent financial information when you need it, establishing the right set of analytics can solve your problem.
This expanded access to information also means that security becomes a larger concern. Whether its ransomware, identity theft, or protecting customer privacy, startups need security solutions that work from day 1 without having to employ a team of IT professionals. Remote work means that personal devices become a new point of vulnerability for businesses. Good policies for technology use are the first step in avoiding problems down the line. For example, these might include how personal devices are stored, restricted use of public WiFi, and how sensitive data is transmitted. Also, choosing good security software along with more advanced options like VPNs are key to keeping everyone’s information safe.
The challenges and opportunities these trends present can be a lot to manage for a new business owner. Getting the right help is key. Crosslin has the expertise and foresight to help your startup or small business in all of these areas. Contact Crosslin’s managed accounting team at (615) 320-5500 if you would like to know more about how we can help you adapt and thrive.