| Every business functions through a range of disciplines, | | | | this can be viewed against the level of sales and |
| sales and marketing, operational skills, purchasing and | | | | justified. Statistically small businesses run by born |
| management. A small business accounting software is | | | | salesmen achieve high sales but at the cost of lower |
| also an essential tool to bring financial discipline to the | | | | margins while businesses run by accountants tend to |
| business. No matter how skilled and well trained the | | | | achieve higher profit margins but with lower sales. |
| business every small business needs a full range of | | | | This statistical fact is true as is also the fact that most |
| functions to reach the highest levels of success. | | | | small businesses are run by neither accountants nor |
| The first lesson in business is to ensure that business | | | | salesmen but by the skilled worker applying their trade |
| has sufficient cash to trade the next day. Failing to | | | | or area of expertise. By using a small business |
| meet this target and the business is finished which is | | | | accounting software the entrepreneur can judge what |
| why accounting and in particular accounting software | | | | he would like the figures to show against what they |
| should be regarded by the small business | | | | actually show and take the necessary action to |
| management as an essential piece of kit. | | | | change the future and produce the desired result. |
| This comes in many guises some of which will be | | | | Without accounting software the entrepreneur works |
| more suitable for a particular business than others. | | | | in the dark depending on hunches rather than financial |
| Nevertheless the choice to adopt a solid form of | | | | facts. |
| financial control is vital to ensure sales are higher | | | | No matter how good or bad a business is the cash |
| enough to generate profits, margins are sufficient, | | | | flow or lack of it might well determine future growth or |
| costs are controlled, net profits are generated, cash | | | | in the worst case scenario, survival. Many small |
| flow is under control and losses can be identified and | | | | businesses that do not use a small business |
| reversed or halted. No large business would survive | | | | accounting solution package and run into difficulties |
| without a sophisticated system of financial control and | | | | have often been in financial problems for many |
| small businesses have the same requirements albeit | | | | months before it is obvious as reductions in profitability |
| on a different scale. | | | | are hidden by extended credit from suppliers or |
| Many entrepreneurs who run a small business regard | | | | tightening credit lines with customers. |
| the accounting function and the recording of financial | | | | It can indicate which parts of the business are doing |
| transactions as an administrative burden. Small | | | | well, where action is needed if underperforming and |
| business accounting software should not be viewed in | | | | may also indicate where action needs to be taken. |
| this way but instead as a tool to assist the generation | | | | Accurate control of money owed in and money owed |
| of safer stringer profits and the early warning system | | | | out is extremely difficult without the information to |
| of dealing with problems if the business does not | | | | know how significant these figures are. But they can |
| perform. | | | | be critical for some businesses and using a small |
| Use it to update the financial records at least once | | | | business accounting software that provides this |
| each month. With sales recorded every month peaks | | | | information is crucial. |
| and troughs in performance are obvious and can then | | | | A disadvantage is that it may sound like a foreign |
| be examined to replicate those actions that produced | | | | language but it does not have to be so difficult. |
| higher sales levels and cut out those actions which | | | | Accounting software using a database can require |
| produced lesser results. The result hopefully being | | | | some bookkeeping skills to get the most out of the |
| sustained sales growth. | | | | system but there are other alternatives. A solution |
| Record all the costs each month and as with sales the | | | | written on excel spreadsheets that produces all the |
| trend to higher costs or more efficient cost control will | | | | main requirements with all transactions visible can be |
| be evident from the financial accounts. Also of | | | | an ideal solution for small businesses with little or no |
| importance will be the profit margin being achieved and | | | | bookkeeping or accounting knowledge. |