In today’s retail industry time is money and retailing is not just an art but a science.
Keeping track of every single transaction in and out of your business will help you to systematically measure revenue and profits, identifying areas of the business which are doing well and where you need to make some changes.
How often do you use your management accounts information to actually manage your business on a day-to-day basis? If you’re not then this could be down to the fact you're just not getting the information quickly enough. real time accounting gives you financial data almost immediately after the transaction, whether that be a purchase or a sale. You have real time access to your profit and loss, balance sheet values, sales reports and more. Having these figures to hand allows you be savvy and react quickly to the needs of your business.
Profit and loss and the state of play.
The profit and loss is the first report that benefits from being in real time. You are able to see on a daily basis, at any point during the month, what your profitability is. You can compare it with previous periods to see if you are doing better and to work out how well you did or didn’t do.
Plus there’s no waiting for the month end, real time accounting means you get real time visibility of the state of play of your business.
Whether you’re looking for finance from investors or looking to reinvest in your business, you’ll have access to up-to-date, accurate data from your accounting reports to make better business decisions. You can see exactly where you stand with no lengthy wait while your accountant pulls together the figures.
Use your accountant more wisely.
By having real time accounting your stock valuation is always up-to-date and there is no need to produce monthly opening and closing stock valuations.
Each time you make a purchase or ship goods your stock valuation is immediately accounted for. You know exactly what the cost of goods sold (COGS) is, what profit you’re making each month without time consuming calculations and journal corrections, meaning less time for your accountant to work out what happened and more time for them to give you the advice you need.
What's working, what's not?
When using a system which accounts for channels such as eBay, Amazon and Magento, you can quickly and easily see what channels are working for you and what are not.
A common mistake made by multichannel retailers is thinking that a channel like eBay is performing well for them because they are receiving lots of orders, when actually they are making very little or no profit once all of their costs are taken into account.
By filtering and comparing the information within one system you can see real time accounting data for each separate sales channel against the costs to source goods. You can keep track of your margins to identify areas to improve, giving you the ability to make informed decisions to make adjustments quickly.
Without truly understanding your profitability and cash-flow you run the risk of building an unprofitable business or worse still, going bust! Business decisions need to be made on accurate, timely and comprehensive information rather than just intuition. If you’re not looking at up-to-date accounts information on regular basis you cannot survive. The retail industry is confronted with unprecedented change, being agile and acting on intelligence about your business will keep you competitive and one step ahead of your competition in the market.
“Accuracy is a huge advantage for us, by having all our retail information stored centrally, there is less room for error. The real time accounting is a big bonus, it means no more paper ledgers or spreadsheets which is great news. We no longer have to repeat manual activities saving us time and having to do monotonous tasks. We can see an overview of the business by just logging into Brightpearl, allowing us to evaluate the business much more efficiently.” - Jonathan Partridge, Director, David Shuttle.
Keeping an eye on everyday costs to the business via real time accounting will help you to identify hot spots which could cause you pain. You can quickly react, reorganise and restructure - this savvy strategy will boost the productivity and profitability of your retail business. With real time accounting data available at any time, day or night, you’ll have peace of mind and confidence that you have a true reflection on your business accounts.
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