How To Make More Money From Your Business – Part Two
Part Two – Bookkeeping
Bookkeeping is one of the most important and business critical aspects to managing and improving a business. But it is so often overlooked. We can’t stress enough how important regular accurate bookkeeping is.
By keeping your financial records up to date means the information is accurate and can be used to manage your business. By then using the basic reports in your MYOB or QuickBooks you will be able to quickly understand what products you are selling to what customers and how much gross margin you are making on those sales.
KPI’s
Smart business owners are intimately familiar with the “numbers” of their business. What are the Key Performance Indicators or KPI’s that drive your business? Big businesses look at reports daily. They use KPI and simple reporting tools sometimes called dashboards. Like a dashboard on a car they quickly tell you what you need to know about where your business is going and how it is travelling. You don’t need to look at every single transaction every day, just look at simple summarised dashboards you can implement quickly in your business even from MYOB or QuickBooks.
Sales
In most businesses the 80/20 rule applies. That is, 80 percent of your sales come from 20 percent of your customers. Who are the customers who make up that 20% in your business? Do you know who they are and what they buy? Can you look after them better?
Benchmarking
Your system can also quickly show you where and when you are spending too much money. You can compare month by month and also compare against industry benchmarks widely available free on the internet to see where you are overspending compared to competitors in your industry.
Change Now!
For your reports to be meaningful and accurate you need to ensure your bookkeeping is up to date. Once you have your bookkeeping updated your system makes it easy to look at your reporting weekly, if not daily. Once you have made these changes and improvements you won’t look back. Growing and improving your business will become a fun and exciting task.
For our recent newsletter on this subject refer to our website here.
Previous blog entries in this series:
Trackbacks