All the (accounting) gear, no idea?
Many businesses have recognised the importance of digital technology when it comes to bookkeeping. But are you really taking full advantage of the apps and processes that are now available? Jack Moore, Partner at Page Kirk, shows you just how valuable they can be to your business.
As a business owner who has plans to grow your business and drive it forward, keeping on top of your books is a necessity, not an option. You may regard spending your evenings and weekends doing your bookkeeping as a pain in the proverbial, but to make decisions around how to improve profitability and to have full performance oversight of your business, your accounts need to be kept bang up to date. If you find yourself asking any of the following five questions, get in touch with your accountant to discuss how you can find the answers.
Which of my products/services/branches has the best/worst profit margin?
A key question for any business. How can you grow your business if you don't know how your product/service lines are performing individually? How will you know which product/service is weighing down your bottom line like a lead balloon? And how will you know which one is poised to make an absolute killing, if only you were plugging it hard enough?
Quickbooks andXero are geared up for exactly this type of analysis. They contain all the tools to allow for detailed analysis. Speak with your accountant to make sure that your accounting software of choice is set up in the correct way and that you know exactly how to record each transaction to make this type of reporting possible.
Which of my customers take longest to pay, and how can I compel them to act more quickly?
Cash is king in business. Always has been, always will be. The cash on your books is far more valuable in your business' pocket than in your customers' pocket. You've made your sale with them, they're happy with what has been provided, you've made your payment terms quite clear on your invoice. So why do so many of us accept that our customers will routinely pay outside of the agreed terms? Fear of upsetting the applecart usually, as well as a desire to avoid any level of confrontation at all costs.
Satago has built its reputation on getting your invoices paid faster. Use it to automate invoice payment reminders, and to supercharge your credit control. Used correctly, it will help to massively reduce debtor days and improve your cashflow by issuing automated payment reminders as soon as an invoice becomes overdue, or at any set number of days afterwards. The software is so clever that it can send reminders from your own email address, and you are able to fully customise the automated emails so that you retain that personal touch with your customers.
How much cash will my business have when the VAT/CIS/Corporation Tax payment deadline rolls around?
Budgeting for costs is a difficult task for many businesses. Budgeting for tax bills is even harder. Nobody likes paying them, but one tax bill or another is always looming for your business, and you should be aware of when the next one is due and how much cash you will need to settle it. You don't want to find yourself scratching around to make ends meet each quarter/year when the next big tax bill rears its head. Having such a bill in the first place is a result of profitability on paper, so profitability isn't the question - cash management is. And the two don't always marry up.
Spotlight Reporting offers powerful budgeting and forecasting tools. Check to see whether your accountant uses it. A well thought-out cashflow forecast can save a business, help you plan for that next big tax bill and to make confident and informed decisions, which are often the difference between success and failure. Cashflow forecasting is so important that studies have shown inadequate cashflow management is the main contributor to the failure of a small business as much as 82% of the time. Don't let your business fall victim to poor cashflow management, because profit on paper doesn't pay the bills. Cash does.
Where can I find the funding to kick-start my next big business move?
Do you have plans to launch your next product line? Perhaps you have identified a key area in which to open a new store/branch. Or maybe you need to focus more energy towards your latest marketing campaign. All big business moves require availability of capital. You can't achieve any of them without having the cash available to plough into the projects.
Capitalise can help a business access funding from 100+ lenders. Did you know that a business is 4x more likely to achieve its funding requirements with guidance from an accountant? Speak with your accountant to find out whether they partner with any finance products. Capitalise works with institutional lenders, including high street banks, as well as alternative and independent lenders. Your accountant will be able to help find a specialist who can not only provide you with the funds your business requires, but who also has a proven track record of supporting businesses within your sector.
How can I make business spending easier for my employees?
Expense forms are a pain for any business owner to deal with, whether you have an inbox full of them or an in-tray overflowing with them. You know the drill: once a month you are overwhelmed with a wave of expenses claims from your employees which somebody needs to sit down, key in the details and reimburse. Perhaps you reimburse expenses through the payroll, or maybe you make a separate BACS payment for them.
Pleo and Soldo are two brilliant expense solutions which many small businesses are now using to help their employees feel part of the fabric of the business they work for. Provide a prepaid spending card with set limits to each of your employees, and you will quickly find that expense reports become a thing of the past. The employee can use the app to snap a picture of their expense receipts too, which will integrate with your accounting software. No more tedious expense reports, and no more reimbursements.
If you want to discuss the true potential of the digital environment for your bookkeeping, then please do call us on 0115 955 5500 or email email@example.com.