This is the third post in our three-part series on bookkeeping for retail businesses. Our first post is a comprehensive bookkeeping guide for retailers. The second post in this series looks at 10 KPIs every retailer should track.
Most retail business owners start a business to sell a product, but unfortunately, a lot of tedious and time-consuming administration work goes along with this. Bookkeeping is one of these tasks. While it may be tempting to try this work yourself, chances are you haven't professionally trained as an accountant or bookkeeper.
For your retail business to thrive, it is imperative that all of your books are in order and you have a solid knowledge of the financial health of your business. This is why outsourcing your bookkeeping is an excellent option. Finding a reputable bookkeeper to handle your accounts will provide you with quality monthly reporting, giving you visibility on your cash flow and financial performance, all while saving you a significant amount of time. Here are some important factors to consider:
Scope of Work
Before choosing your bookkeeper, you want to determine precisely what your business needs are to ensure that whoever you choose can meet them. Some bookkeepers specialize only in
+ data entry and keeping your numbers organized, while others provide valuable insight and analysis.
Some of the typical bookkeeping tasks include:
- Recording daily sales data
- Recording expenses
- Reconciling bank and credit cards
- Filing sales tax - GST/HST
- Generating monthly financial statements (income statement, balance sheet, cash flow statement)
If you require a bookkeeper to assist with payroll, cash flow forecasting, or budget creation, do your research beforehand to ensure that they can provide these services.
Technology Expertise
Technology is changing daily, and recent advancements have made running certain aspects of a retail business much more manageable. Modern stores now utilize POS systems, inventory management software, and time tracking software, many of which integrate with cloud accounting software that helps to streamline all different aspects of the business process.
When choosing your bookkeeper, look for tech-savvy and understand how to use these different accounting and bookkeeping tools. A bookkeeper who can take advantage of these integrations will ensure that data flow is accurate and timely.
Industry Knowledge
Another question to ask your potential bookkeeper is their knowledge of your specific industry. Every industry has different bookkeeping needs. Ideally, you want to find a bookkeeper who has experience working with retail businesses. Hence, they understand common bookkeeping issues related to your industry and can work with you to help you resolve them.
Scalability
One of the main goals of most retail businesses is growth. You want to expand your business to new heights, increase your sales and reach new levels of success. This drive and ambition has gotten you this far and will propel you forward in the future.
When selecting a bookkeeper, you want to ensure that you choose someone who can grow along with you and take on the extra work that you will one day inevitably provide. Ask them how they will be able to accommodate you if you open up more locations and what this process of growth would look like. Finding someone who can scale along with you will be much easier than looking for a new bookkeeper down the road to handle the increased workload.
A passion for what they do
Passion is an essential part of any job, and it's no different when it comes to bookkeeping. When selecting your bookkeeper, you want to make sure that they not only have solid knowledge and understanding of the numbers but that they also love what they do. A bookkeeper who is excited and eager to assist you will provide a better quality of work and greater accuracy and, in the long run, will be better for the growth of your business.
Hiring a bookkeeper to assist your retail business is one of the best decisions you can make. It will help you stay organized and will keep your numbers accurate and up-to-date at all times. Looking for someone who can do the work you need them to do and do it with passion will go a long way in aiding your business's success.
Not ready to hire a bookkeeper? Consider outsourcing. A fractional bookkeeper can provide the expertise your business needs while maintaining affordability. Here's why you might consider outsourcing.
Reasons to Outsource Bookkeeping
Access to bookkeeping expertise
Outsourced bookkeepers have spent years working with numbers and important financial data, making them experts at organizing your books. By outsourcing your bookkeeping, you get access to professional bookkeepers and accountants with extensive experience. You can trust them to handle the complexities of your business and keep your data accurate.
You will always have reliable, timely financial data
Having trustworthy and up-to-date data is extremely important to any retail business. To make crucial financial decisions, you must know precisely where your business stands from a financial perspective. When you use an outsourced bookkeeper, they’ll keep your finances current throughout the year.
Save time
Time is money, and this is especially true for a retail business owner. You didn't start your business to become a bookkeeper, but so many business owners enter into the world of bookkeeping as a means to try and save money. Unfortunately, this often leads to errors in their books and bookkeeping delays as this critical task falls to the bottom of the priority list.
Outsourcing your bookkeeping to a professional can save you an abundance of time, freeing you up for much more important things. While your bookkeeper may still have questions about the coding of certain transactions or about the timing of specific invoices, the amount of time they will save you, in the long run, will make it all worthwhile.
Lowers operating costs
Finding ways to lower the operating costs of your business will not only improve your cash flow but improve your overall profitability. Generally speaking, outsourcing your bookkeeping will save more money than hiring an employee in-house to do the work. You don't have to worry about payroll deductions, CPP, EI, and all other costs with a new hire.
Another benefit of outsourcing your bookkeeping, as opposed to hiring a bookkeeper, is that many in-house employees may not be able to grow and scale along with your business. An outsourced bookkeeping firm usually has a much larger staff that can grow with your company and continue to meet your expanding needs.
Gives you peace of mind
There are so many things to worry about and so many more that require your attention when it comes to your business. By outsourcing your bookkeeping, you can gain the peace of mind that all of your accounts are being kept in order and your financial data is up-to-date.
It also relieves the stress that is inevitable during tax season. When tax time comes, you can rest assured that your bookkeeper has everything well organized. You can trust your bookkeeper to provide the most accurate data when remitting GST or HST.
As you can see, the benefits of outsourcing your retail business's bookkeeping are endless. Not only will it save you a substantial amount of time and money, but it will also allow you to foster a relationship with an experienced professional who can help answer all of your most detailed financial questions.
Whether it comes to dealing with taxation issues or lowering your operating costs, outsourcing to a professional bookkeeper will provide your retail business with the assistance it needs to succeed. It will give you the peace of mind that your finances are in good hands.
If you are looking for bookkeeping assistance, look no further. At Enkel, we pride ourselves on our knowledge and technological expertise in the retail industry. For more information on how we can help you grow your retail business, reach out to us today.
