Bike Shop Management

Simple Accounting Tips that Will Save You Money

If you’re like many small business owners, you dread everything related to accounting. You likely got into your position because you want to be in control of your schedule and your purpose. But for all the ways it’s great to be the boss, it’s not so great to be responsible for the accounting, especially if you’re constantly stressed and losing money because of poor practices.

There is good news for you. With two major tips, you’ll soon be managing your accounting with ease and saving money. 

Here are the two tips: Time is money. And organization is key.

1. “Time is Money”

How often have you heard this mantra?

When it comes to accounting, it’s even more true. If you waste hours and hours keying numbers and putzing with your chart of accounts without knowing what you’re doing, you’re losing money by wasting precious time. And you’re likely making costly financial mistakes, too. Even if you’re ending every month in the black – are you overlooking hidden waste?

Bonus tip: If you’re reading this, chances are you have access to  Savings4Members, which means you get complimentary cost cutting services and exclusive discounts. Learn more below to access them today!

Hire a Professional to Help You

You have demos to schedule. A shop to keep running. And inventory to handle. When it comes to accounting – hire someone to help you. It’s cheaper in the long run and saves a big headache. According to Accounting Today, 39% of small businesses hire an external organization to manage bookkeeping. This could vary based on your need. It could be hiring a tax professional, a full-time bookkeeper, an advisor, a payroll company, or all of the above. 

Automation is the Answer!

There are countless programs available to automate accounting operations.  You could automate the way your invoices are sent out via email to customers or automate the way you pay your vendors. You could set up an automatic reconciliation in your accounting software. There’s really no end to the automation – figure out what’s reasonable for you and get it working. There’s even a good chance the help you hire can implement this automation for you.

2. Organization is Key

Organization is key. Being organized will save you time, which will save you money. But it will also create time for strategic thinking. 

For every minute spent in organizing, an hour is earned.

– Benjamin Franklin

Keep Personal and Business Expenses Separate

This is a must. It’s easy to want to consolidate credit cards and purchases, but you must keep personal expenses separate from business expenses. There are a number of programs out there to help you track expenses, both personally and professionally. Use these if you need to.

Be Prepared for Major Unexpected Expenses

You never know what could happen. One of the major causes of small business failure is inability to cover unexpected expenses. Do you have an emergency fund of cash set aside for surprises? It could save you far more in the long run than taking out a costly loan to make repairs or replace inventory (should you need to).

Keep Running Projections for Financials & Actually Use Them

Make it a habit to look at your projected financials and compare them to your actuals. Get in the practice of doing this on a regular basis, preferably each month. By monitoring expenses and analyzing discrepancies, you will stay on top of any issues that could otherwise accumulate if left unchecked. 

Use Accounting Software

Studies by Statista say about 65% of small business owners use an accounting software system. Regardless of the type of business you have, this is critical. Many small businesses use Quickbooks. There are other solutions available, some even free. A few with good reviews are ZipBooks and Wave.

It can be that simple! By remembering that each minute of your time is valuable and organization is key to success, you’ll clear up some important mental space for strategic planning while saving money.