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Last Week I started a post on the challenges of bookkeeping for Business Owners. If you missed it, you can read it here.
Some business owners only perform bookkeeping tasks as minimally as they can throughout the year, and then are overwhelmed by what needs to be prepared at the end of the year to prepare their tax return. In most cases, you are probably spending all of your time getting the data into some sort of software, whether that be Excel, QuickBooks or Simply Accounting, that you never have the time to look at some of the valuable information that the data can provide for you.
I’m here to tell you that it doesn’t have to be like that and in all honesty it shouldn’t be like that. Bookkeeping, if done right, can be one of the most important and valuable pieces of information to help you run, manage and grow your business. No matter how big or how small you are, I always go back to my favourite saying – “How can you manage what you don’t measure?” (Actually my favourite saying is “What doesn’t kill you makes you stronger”, but that didn’t seem appropriate here )
Now imagine the following scenario:
- From your bookkeeping, you are able to determine what your most profitable product or service is.
- From your bookkeeping, you know how long it takes for your products to turn through your inventory, and which ones turn the fastest and the slowest.
- From your bookkeeping, you know exactly how profitable that job or project was.
- From your bookkeeping, you are able to determine who your best customers are in terms of sales, and who your slowest paying customers are.
- From your bookkeeping, you are able to determine who are your most productive employees or highest performing sales people.
- From your bookkeeping, you are able to determine whether you can afford to invest in a new product or service launch, and what numbers are required and when to make that product or service successful.
- From your bookkeeping, you are able to determine what the business can afford to pay you or your next employee.
Hard to believe that all of that is possible from that stack of papers that you usually tackle after your business has closed, or on your precious weekend time. But it is possible and so much more.
Some of you may already receive some of the information I’ve listed above when you sit down at the end of the year with your accountant. But what if you could have that information at your fingertips, every month throughout the year?
Where can you take your business with all of that valuable information? Or…what can you accomplish in either your business or your personal life with all of that free time? I’d love to hear your comments or your experiences with your bookkeeping from a business owner’s perspective.
What is your biggest challenge? If you’ve been able to overcome it, how did you achieve it? After all, regardless of how long we’ve been in business, we can always learn something new. By the way, in case you were wondering what the picture has to do with this article…not much really, but I’m partial to Boxers since we have one, and hopefully the picture made you smile