So, you are considering investing in a budgeting and planning software to help you manage your business’s finances. That is a wise decision. Here are some of the services and functions included in a software package that will benefit your business.
What does financial data analysis software include?
- Business valuation: With financial analytics software, you can easily evaluate your company’s market value in order to determine your standing in your specific industry.
- Financial risk analysis: Financial software can help you calculate risk and prepare for financial problems. Risk analysis basically involves creating a comprehensive strategy called a Risk Management Plan (RMP) to keep your company profitable in the face of cash flow disruption. Using the right financial tools, you can review your company’s financial health and its ability to stand up against market fluctuations.
- Performance scorecard: Financial data analysis software will provide you with a snapshot of your company’s financial status so that you can easily comprehend your business performance.
- Liquidity analysis: You can analyze your liquidity by determining working capital needs while modeling techniques to improve cash adequacy with “what-if” scenarios.
- Industry metrics: In addition to viewing your own data, you can view the annual statistics, ratios, and financials of your competitors in the industry.
The sad truth is that 25% of businesses fail after their first year. Half of these businesses fail because of simple “incompetence.” These companies are financially illiterate; they have no understanding of pricing, lack proper budget planning skills, have no experience keeping records and following market trends, and live above their means. By the end of their fourth year, 50% of businesses have failed.
Financial analytics software will take into account all of your credit, loans, and liabilities to make sure that you have enough capital to maintain growth. Analytics are essential to corporate growth.
In order to maintain competitive status within the industry, your business needs to keep up with continuously advancing technology.
Keeping track of your company’s finances can seem like a daunting task, and as your business grows, the work it takes to maintain your finances becomes more and more complicated. Financial data analysis software provides you with everything you need in one small and easy to use package.