In an effort to save money and keep expenses low, many decoration business owners may decide to handle basic accounting tasks in-house. Keeping track of income and outgo may seem to be as simple as entering numbers into an Excel spreadsheet, but if you really want to make sure your profits outweigh your losses, you may find some of these tips on managing your finances helpful.
Tip 1. Watch your invoices. If you offer customers terms, then you need a system to ensure invoices get paid in a timely fashion. Set up some sort of monitoring so you’ll be alerted if an invoice isn’t paid on time, and then have a plan for what happens in that situation. Do late-paying customers get a phone call? How long past their stated terms can they go before you’ll refuse to do additional work for them? Having a plan in place will help you avoid confusion when you encounter this situation.
Tip 2. Keep good records. Track all of your expenses and keep notes and logs to back up what you record. A simple notation in your day planner when you have lunch with a client or travel for work could be enough of a record should you need to prove a deduction or support an expense claim. It’s also a good idea to make sure that your sources of income are accurately recorded. A business can get an infusion of cash from several different sources, and not all of those cash infusions are taxable. Keeping accurate records regarding where the money is from will keep you from paying more than you need to come tax day.
Tip 3. Separate personal finances from business finances. When you own a business, it can be tempting to lump all the financial work into one pile and treat everything the same. Make sure you avoid this temptation. There are tax breaks and tax requirements for businesses that personal accounts and expenses don’t have to consider. Separating finances also protects you if your business is a corporate entity. Blurring the lines could lead to problems should your corporate finances ever come under scrutiny.
Tip 4. Find a decoration-specific software package to help you run your business, including accounting and financial functions. Here are some options, all designed for embroidery, screen-printing and promotional products companies, that may fit the bill.
ASI SmartBooks is business-management software that allows your company to manage all business processes with a single, flexible, powerful application. It integrates your company’s accounting, sales, marketing, order entry, inventory, purchasing, shipping, reporting and product sourcing from ASI’s ESP product database into one application.
Pricelist Professional is a software program that can keep track of customers, quotations, orders, artwork and pricing in your shop. Pricelist Professional also prints all of the paperwork you need for each job, including art/digitizing approval forms, pick lists, work orders, master checklist, personalization forms and job specification sheets for your employees to produce the job.
OnSite 8 is business-management software that allows you to manage order entry, purchasing, production, sales, marketing and accounting. OnSite 8 can run in the cloud or on your server. New for this year are accounting improvements and an inventory app that works on Apple iPad and other mobile devices.