For most new business owners, bookkeeping is a challenge. Many don’t like it or find it overwhelming. But like a lot of areas in your business, record-keeping can be learned. And as you grow, it can be delegated or outsourced. You’ll have the understanding and maintain control without doing the day-to-day work!
Ready to take control of your financials? According to Denise Worrell, owner of Your Bookkeeper, here are a few questions you should ask yourself to get started:
- How do you want to handle the paperwork flow? Take a few minutes to write down how you want to handle common transactions like invoicing clients, receiving inventory, paying vendors, capturing credit card or cash receipts, etc. A little planning here will go a long way.
- What method do you want to use for your record-keeping? Do you plan to do it on paper (not recommended) or use a financial management system, like Quick Books? Quick Books is the most popular for small businesses for a reason. It’s easy to learn and use, provides financial and sales reporting including trend comparisons, offers professional invoicing and payment tracking plus a whole lot more. And learning is a lot easier when you start because the volume of work is lower and less complicated.
- When and how often do you want to handle bookkeeping tasks? Do you want to do it daily or is weekly sufficient? Will you invoice weekly and pay bills monthly? There is no right or wrong – but your decisions may impact cash flow. Decide what is best for you, especially when getting started, and block time off to do it. Remember, tasks you don’t like are typically not going to get done unless you schedule them!
- What do you need to record and keep? Most owners recognize that income and expenses should be tracked, but are not sure about assets, liabilities, credit card receipts and statements, etc. Even if you plan to do the bookkeeping yourself, you can consult with a bookkeeper or accountant to help you set it up.
Understanding the financials is not as complicated as some would have you believe. But it starts with a good bookkeeping method, one that allows you to stay on top of what is going on and make better business decisions. Give it a try and you too can effectively speak the language of business.
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