The US bank found that 82% of businesses fail due to poor cash flow understanding1. Clearly, proper bookkeeping is essential for the success of any startup. Unfortunately, it can be a challenging and time-consuming exercise that may eat the time for serving your spa clients.
Fortunately, there are a couple of things you can do to simply do bookkeeping for your business. Read on for bookkeeping tips you can implement to save time and keep accurate, updated records all through.
Bookkeeping Tips for Wellness Businesses
Although proper bookkeeping is a tedious and long process, it is vital for your business to thrive. The following tips will help you manage your books with ease and accuracy.
Automate Your Work Using a Cloud-Based Accounting Software
In the US 64.4% of SMB owners use accounting software.2 Investing in cloud-based accounting software is an excellent way to streamline your bookkeeping operations and save costs. The software also keeps your data secured and enables you to access the data from anywhere in the world.
The accounting software will help you with operations such as managing payrolls, generating financial reports, invoicing, direct integrations to your bank, and more. Software like QuickBooks Online and Xero are good examples.
Separate Your Personal and Business Accounts
The most common mistake made by new clinic and spa owners is not having a separate business account. While having a single account keeps all your money in one place, it will make your bookkeeping task a tough one.
Start by opening a separate account for all your business-related transactions. Thus, the business account will make tracking your expenses, transactions, statements, and receipts a lot easier. Plus, it will make your statements appear professional to potential investors and lenders.
The business account will give you an upper hand if you ever need credit to scale your business. Besides, it will help accountants to easily identify transactions that qualify for tax deductions.
Slot Time for Bookkeeping
Many spa and clinic business owners like to postpone bookkeeping tasks. Such an approach breeds inconsistency, making it harder to track your business progress. Instead, schedule time for bookkeeping a day each week or monthly if you are short on time.
Ideally, consider reconciling your accounts each week and reviewing your profit and loss, and cash flow statements on a monthly basis for a start. Then as your spa business scales, reconcile your books daily.
Consistent bookkeeping will help you identify sales patterns, client payment patterns, and general revenue trends. Consequently, you will be able to take appropriate actions.
Hire a Bookkeeping Expert
Excellent bookkeeping is necessary to the success of your business. This is possible in the hands of a trained bookkeeper. If hiring a full-time professional isn’t possible, you can outsource your bookkeeping tasks.
In turn, you will get more time to focus on your clients and more accurate records regarding your business finances.
Keep Your Business Afloat With the Above Bookkeeping Tips
Maintaining accurate and up-to-date business records is necessary for the smooth running of your business. Thus, with the above tips, you will track your business finances and identify areas to improve.
Links to Sources Used
- Bookkeeping and business failure https://preferredcfo.com/cash-flow-reason-small-businesses-fail/
- Businesses using accounting software https://www.statista.com/statistics/623268/software-usage-in-us-smes/
