Small business owners need real data in order to make the smartest decisions. Passionate ideas and creative strategies are great, but without numerical insights to guide decision-making, you could end up closing your doors and not knowing why.
Accounting gets quite a dull rap in the business world, but it’s more than just bean counting. Modern, cloud-based applications help business owners to automate reports and even take advantage of AI technology.
With the right accounting platform, updated books can be a valuable resource for financial analysis and business growth.
If you’re up-to-date on your bookkeeping, your accounting software will automatically produce powerful reports for you. Regularly analyzing these reports will help you to track the financial health and viability of your business—and it’s really a cinch to do.
One free alternative to QuickBooks that empowers business owners this way is ZipBooks. After you’ve accurately categorized and reconciled your spending, ZipBooks will automatically crunch the numbers and present them in easy-to-read ways. The data you need most is color-coded and also presented in charts and graphs, so that you can pull out powerful insights quickly.
Reports that track your profitability over time (Income statements) and reports that tell you how much your business is actually worth (Balance sheets) should be referenced frequently to determine what the next steps are for your company. Remember, however, that profit does not equal cash on hand, so you’ll also want to consult your Cash Flow statement (more on that later).
For multi-location or franchise accounting, ZipBooks makes it easy to visualize financial data and quickly compare trends. The single interface consolidates revenue and expense reports in order to clearly illustrate what’s working and what’s not.
When some people think of accounting, their thoughts immediately go to taxes. While finding tax deductions are only one of the many insights your accounting platform can give you, they’re of great importance to business owners.
If you can regularly track and categorize deductions, you will get every tax advantage. ZipBooks produces an Expense summary, so you can easily manage relevant spending categories. You can also link any relevant documentation to the corresponding transaction in your books. This way, you’ll never lose an invoice or be caught off-guard in an audit.
Smart accounting software also highlights all of the most common deductions: home office, mileage, materials, professional fees and pass-through business write-offs. With the documentation to prove it, your accounting platform helps you take every deduction you can.
A smart accounting platform will give you the advantage by measuring and monitoring your Accounts Receivable.
Every business needs an efficient way to keep the cash coming in. Your accounting software should help you measure sales, track down funds and expedite your invoicing cycles. Automated reminders, recurring billing and digital payments empower ZipBooks users to improve their cash flow. This means less steps for customers to make a payment, and you getting paid faster. Then, these transactions are automatically entered into your accounting records—one less thing to worry about.
Additionally, smart bookkeeping software can keep you from miss your own payments, so you don’t incur unnecessary late fees. Furthermore, if you find that you are overspending on key vendor expenses, you could try to negotiate for a better deal or consider alternate solutions.
Smart accounting platforms can also help you grow your online presence through customer reviews. Some 95% of consumers say they have read online reviews. In today’s world, if customers can’t find your business online, it’s like you don’t exist.
ZipBooks monitors customers feedback on the most important platforms—Google, Facebook and Yelp. It also allows you to automate personalized review invites, so you can increase the influence and volume of review profiles. Both marketing and SEO efforts are enhanced by this kind of accounting integration.
Plus, you get free feedback from real users on how you can improve your product or service.
Online reviews are only one example of powerful integration that pair with your accounting software. You can gain even more real-time insight by linking your payroll processor and time tracker. Syncing these functions helps you to calculate true labor costs and find areas of possible improvement.
There are many other services that can be integrated with accounting—HR, POS, and invoicing (to name a few)—and each of them offer invaluable data to business owners.
Take the time to find an accounting solution that makes you smarter and provides the business insight you need to edge out the competition. Data-driven decision-making like this builds better companies, and you can automate the process even further with ClicData.
About the author
Jaren Nichols is Chief Operating Officer at ZipBooks, free accounting software for small businesses. Jaren was previously a Product Manager at Google and holds an MBA from Harvard Business School.