In this article, small business administration means attending to all the mundane tasks - regulatory compliance, accounting, personnel and systems - involved in running the small business.
This page comes under the section Small Business Management.
This focus was selected to highlight that you have to attend to many routine tasks in the course of running a successful small business. These routine tasks mignt not be as exciting as marketing or production operations, but have to be performed to keep the business going.
The issue of complying with government regulations have been discussed in a separate article. We discuss the other main tasks below.
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You have to keep track of the dues from customers and your own dues to suppliers and lenders. You do this by recording all the transactions with these people - incomings on one side and outgoes on the other side. The incomings can be money, or other kind of value like supplies received from suppliers. Outgoes can also be money, or value provided to customers.
You also keep track of your sales and costs, to know whether you are making a profit or loss. You total up your sales and other income on one side, and costs and expenses on the other, and extract the difference between the two to find out the profit or loss you made. Additionally, if you are liable to pay tax, you need proper accounts to prove to the tax officers that you have only so much tax to pay.
Finally, it would be a good idea to know the value of your assets, such as equipment, vehicles, receivables and deposits, and the liabilities you incurred, such as borrowings and different kinds of other payables, for acquiring these assets. You can then find out whether you have more assets than liabilities, or otherwise.
If you employ people, you are legally bound to maintain several kinds of records. You need to maitain attendance records and payrolls showing how the dues to your employees are calculated. You also need records to show how much paid leave is due to employees and how much of it they actually utilized.
You might also have to maintain records under Health & Safety regulations, say, by recording all incidents of accident or injury that occurred at the workplace.
Employers are obliged to deduct due taxes from the wages they pay, and pay it over to the government. This would involve recording the deductions, and the payments to government, as well as rendering periodical returns to the government.
Disciplinary matters also need to be documented under law, and you might need these as evidence in case an aggrieved employee goes to court.
You need to prepare many kinds of schedules, plans and reports to ensure that your operations are going on in the best possible manner. For example, machine loading schedules can help you utilize your installed capacity in the best possible manner. A very different example is the sales report that tells you which regions, products and salespersons are producing the best results. Yet another high value report is the cost report that indicates the costs you are incurring, and help you check whether your selling prices are profitable.
In these days of computer-based software, you need spend only a minimal time on attending to the adminstrative routines. Once properly designed and implemented, the computerized systems will generate all kinds or schedules and reports based on the data you (or your staff) enter.
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