by John Whonderr-Arthur Esq Phd

Created on: June 11, 2009   Last Updated: June 25, 2009

Solving a problem is not the problem but the problem is sustaining the solution. Sometimes strategies adopted do not last long enough for the business to realise the effect;a 9-day wonder. Modern financial management supports the view that small and medium enterprises have unique problems and need special strategies to tackle that. Pursuing a growth strategy is one of such issues. This article considers sustainable strategies for small business's growth below:

i.Keeping Proper financial records.

The figures that a business generates are an index of its health and growth. However, many managers in small businesses tend to be positively scared of them and therefore do not keep control or update them on regular basis.

It is not good enough to monitor the state of health of the business by using the Annual accounts. This is normally not available until the following year which in terms of knowing the financial position of a business is quite a long time away.

There are good reasons why the Owner should make sure that good business records are kept, providing information for example to, the Inland Revenue, Customs and Excise (for VAT), and the Bank Manager. However, the most important reason above all is that properly kept accounts, summarised at the end of each month and combined with a stock take or an estimate of the value of the stock, will provide the Owner-Manager with an up-to-date information about the business. By doing so, this would enable the Owner-Manager to spot danger signs and to react whilst there is still sufficient time to take corrective action and to plan ahead for future.

II.The Development of Modern Financial Management Practices.

This is necessary in order to evaluate the working capital requirements of the business. Discounted cash flow analysis could be used to support investments decisions (i.e. importing and exporting of goods).Financial management practices like discounting cash flow analysis could be added to Ghanaian primary school curriculum at an early school years. Since most SMEs employ many drop outs from school. In the event where majority of products are imported from suppliers overseas, managing currency properly is very vital. As mentioned previously, foreign currency hedging could be used to reduce or lower the cost of purchasing imported products. This is not to say that the Small business should grow overnight but it is to let small businesses identify with the practices of modern financial management in

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