Posts tagged ‘Quality Advertising’

To many small business owners, administration and bookkeeping are a necessary evil of being self-employed.  Often managed simply to keep HMRC away from their door, the bank manager happy and accountancy fees at a palatable level, bookkeeping can be a time consuming and often monotonous chore, that steals time away from servicing client’s needs and therefore earning profit.

Have you considered using the results of your bookkeeping efforts to drive your business forward?

There are many ways that management information can help you to manage your business as well as complete your VAT return and keep an eye on cash flow.

  • It can assist the business owner in making good quality decisions
  • It can monitor performance indicators such as turnover against budget or prior year
  • It can help ensure you get paid for the work you do and manage financial commitments
  • It can highlight more profitable areas of the business, or potential to cut costs

Let me illustrate with an example.

A well maintained sales ledger, in a well constructed spread sheet or using software such as Kashflow or Sage, can improve cash flow, increase profitability and grow your business.

How?

  • By reporting customers in order of money spent, you can focus on providing your best customers with the best customer service, reducing the chance of them looking for alternatives or being as price sensitive.  This will also encourage advocates of your business, which will provide the best quality advertising at no cost.
  • Analysing debt by age can highlight poor paying customers who may indicate the need to improve the way you do business or highlight the need for more robust credit control.
  • You may decide that poor value customers or late payers are costing you too much in time and cash flow, so refuse to accept
    their future business or at least renegotiate terms.
  • Incorporating a little CRM (customer relationship management) data such as the source of the customer (e.g. advert, referral etc) can help you calculate the cost of acquiring new business and give you clues regarding your marketing spend.
  • Looking at accounts that have not been active for some time could highlight missed opportunities.
  • By improving the amount of cash flowing in to your business you can reduce the cost of finance and perhaps have more
    negotiating power when purchasing.

Not for you?

If the thought of devoting more management time generating information turns you cold, then outsourcing is probably your best option.  Many small business owners feel the need to control every element of their business and often consider cost to be a barrier, but in most cases outsourcing bookkeeping will pay for itself; by freeing up time to focus on the performance of the business or indeed to do more business.

To find out more about getting a return from your investment in bookkeeping, give me a call on 01480 426500 or Skype chat with tonimhunter.

The information provided in this blog illustrates my opinions and experiences, it does not constitute advice and I do not accept responsibility for any actions taken or refrained from as a result of reading this post.

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