Whether it is innovative point-of-sale systems for retailers or useful online accounting tools, technology has come a long way in the last few years – you just have to know how to make the most of it.
The financial administration that comes with starting and running a business can be a bit of a headache for those that haven’t been through the process before. With a new idea, concept or product, all you want to do is run and expose it to as many customers as quickly as possibly.
You’ll be bombarded with systems and applications that claim to help you through these early challenging days, it just comes down to research and advice to make sure you get the right setup.
One of the big decisions you’ll have to make is whether to find an accountant, take on a bookkeeper or do it all yourself. It is possible to track sales, outgoings, do back receipts, but it will suck up your time and can distract from the all-important task of steering the business.
The point of this article is to explain why technology can serve as an enabler. What I mean by those words is that once a little bit of time has been spent at the start researching and trialling technologies, the output from these can free up hundreds of man hours and also provide you with important decision-making ammunition.
I’m a firm believer in going for a cloud-based accounting system, which can integrate with your business. You don’t want to have to be manually keying in information. If you can get front office systems connected with an accountant and accounting system, everything flows though and produces performance information.
It highlights aspects such as where you are burning cash and provides a real-time view of what the company is doing.
I recently tuned in to the television show Hotel Inspector, which featured a lovely lady from Wales. Despite having a great property, she had no idea what she was doing. With her mortgage in arrears, it all came down to the fact that everything was manual. It was a classic example of where someone is always four or five months behind on figures. She didn’t know what part of the business was making, or more importantly losing, money. The hotel was haemorrhaging cash despite customers coming in.
From my experience of running and helping small businesses, I always say create a bit of a nerve engine – and this can be an accounting system. If you have a number of sales people and want to know how they are doing, then real-time business performance information is pivotal. You don’t want to be like that Welsh hotelier who has no idea.
Furthermore, being able to show a financier how you are doing from a cash flow perspective really helps, and technology means pulling that together is at your fingertips.
So, what is holding back micro and small business owners from being enabled by technology? The first aspect is lack of education. There is so much out there, but where do you start? People tend to worry a lot as well. Having done things one way for the last 20 years, the last two or three have seen a huge technological revolution.
As accountants, people come to us and ask us where to go and what to use, as a kind of validation. Some software products, although pretty nifty, can be difficult to use to start with. With systems such as debits, credits and accounting involved, it makes sense that some become concerned about doing it right.
My advice is to seek the thoughts of peers which have been successful in efforts to integrate technology. Find out where the pain points are, and work out how to make sure this doesn’t happen to you. But most importantly, don’t be left behind by innovation. There are a wide range of people and organisations, like the KPMG Small Business Accounting team, that you can turn to.
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