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How Bookkeeping Helps You Run Your Business

Bookkeeping is not just about ‘keeping the books’. It has far more to do with giving you, as an entrepreneur, the information you need to lead, manage and grow your business. Bookkeeping and accounting services generate the raw material for real business decisions.

As a business owner you can spend some of your time maintaining ledgers and some making decisions, or you can outsource that work to a CPA who knows how to deliver the details you need. You can then spend all your time working on your business. Outsourcing is usually less expensive than employing an in-house bookkeeper. In addition, the outsourced service will not only manage the process for you but will provide advice and agree with you which information would be the most useful.

Let us look at a few simple examples. The Sales Ledger can generate analysis that tells you:-

  • Which customers are actually buying what products or services
  • What other, similar, products could they buy from you
  • How long you are funding their debt
  • The trend on that funding
  • Changes in customer purchasing patterns – for the better or worse
  • Based on current sales which other, existing or new, customers could you sell similar products to

Armed with this sort of analysis you can decide such things as:-

  • Sales volumes, purchase trends, and credit taken, customer-by-customer
  • Opportunities to sell different quantities of the same or associated products
  • Alternate buying frequencies that might help your own production schedules
  • What sales opportunities exist in other customer accounts
  • What recent sales results tell you about the success of your advertising or social media campaigns

An accurate Purchase Ledger also gives you decision-making information:-

  • Your business’s current debt, and the debt ratios (short and long-term)
  • Do returns to specific suppliers indicate a change in their product or service quality?
  • How might that negatively impact your own customer service standards?
  • How might your purchase volumes help you to renegotiate prices or credit terms with specific suppliers?

Effective bookkeeping delivers valuable information to your desk, and enables you to consider how your business is performing. These are, merely, a few examples. Based on the data you get, you can make appropriate decisions. We can help you make them. Our bookkeeping and accounting services will give you the information you need. We will discuss with you what you actually want from your accounts, and then deliver it. Please contact us so we can begin the discussion.