When you own a small business, finances can be tough. This year has been particularly difficult for small businesses, with many losing clients or being forced to make employees redundant due to covid-19.
But there are plenty of ways to improve the finances of your small business. Business credit cards, for example, are popular among small business owners for many reasons. While some people worry at the thought of spending money that isn’t technically theirs, business credit cards shouldn’t be feared. They’re a great way to expand the future of your business. Here’s why you should get a business credit card.
Every person has a credit score. This keeps track of your financial reliability; for example, tracking if you pay bills on time. However, did you know that your business has a credit score, too? This shows future lenders how reliable and likely you are to pay back a loan. So, getting a credit card can be a great way to show off your reliability and rack up a great credit score for the business. This will make people be more likely to invest in you in the future.
We all love to be rewarded for our efforts. Most business credit cards allow you to rack up rewards for your purchases in the form of “rewards points”. These can be exchanged for plane tickets, hotels, or even cash. Different credit cards do different things, so check out what you’d find most useful. If you and employees are taking lots of flights, for example, you might benefit from a card that rewards more for fuel and travel. Just be aware that some reward cards carry annual fees, so you’ll need to establish if it’s worth it.
Managing business expenses
All businesses have expenses. Perhaps an employee needs a hotel overnight on a business trip, or they’re taking a client out on lunch. You might like to keep the kitchen stocked with coffee and milk to keep your employees happy. Your business will cover these expenses and plenty more. So, getting a credit card can make this all more organized and well managed. Pop any expenses on the credit card and you’ll spend less time fussing over receipts. Plus, the tax return process will be much more straight forward.
Similarly, employees often need access to your business account. Instead of them contacting you and getting permission if you can create a business credit card under their name the process will be much faster and smoother. This will also give you a greater sense of what they’re spending money on. It gives you more time to work on other things, while also having more control over the system.