Tracking Your Baking Business Finances: Business Money Management Made Easy

by Sweet Success Magazine Staff

You can also hire a professional to help you manage your business accounts. However, before you do that, it is important to understand what it is that you are tracking and why. 

If you are brand new and just now setting up your business, here are helpful tips to help you as you track your finances and manage your money. The tips below will help you get your cake business finances on the right track, and with some planning and preparations, you can stay organized and easily manage your bakery finances effortlessly. If you are already established, this can be a helpful reminder and a great opportunity to do a business check-in on your finances.

Establishing the Foundation to Your Bakery Business Finances

Creating business accounts helps with the management of your bakery business finances because all of your business funds are in one place. First you should create a business checking account, although establishing savings, and a line of business credit is ideal. To do this you will need proof of a business such as your DBA or LLC registration. At a minimum you will need a debit card, and will also want to get a business credit card to establish business credit (although a credit card is not critical at this step and we actually advise you wait until you have income to consistently pay off any credit as you use it). This sets the foundation for your cake business and is the source of your financial management activities.

Start a New Account for Your Baking Business

When getting started, it helps to deposit an initial amount of funds from your personal account. If you already have orders coming in, this step isn't necessary as your payments from cake orders will be deposited into this account. If you made and initial deposit with personal funds, as you start to earn income from your cake business, you can pay yourself back. After setting up your accounts, moving forward, all business expenses should now be paid from this account.

Keeping your business account separate from your personal account is important because it makes it easier to track and manage your business finances, especially when it tax time arrives. Taxes are an essential component to managing your business and failure to effectively manage them can have serious repercussions for you and your business.