| Every business functions through a range of | | | | and justified. Statistically small businesses |
| disciplines, sales and marketing, operational | | | | run by born salesmen achieve high sales but |
| skills, purchasing and management. Small | | | | at the cost of lower margins while businesses |
| business accounting software is an essential | | | | run by accountants tend to achieve higher |
| tool to bring financial control to the | | | | profit margins but with lower sales. |
| business. No matter how skilled and well | | | | |
| trained the business every small business | | | | This statistical fact is true as is also the |
| needs a full range of functions to reach the | | | | fact that most small businesses are run by |
| highest levels of success. | | | | neither accountants nor salesmen but by the |
| | | | skilled worker applying their trade or area |
| Liquidity is a first lesson in business to | | | | of expertise. By using a small business |
| ensure that business has sufficient cash to | | | | accounting software the entrepreneur can |
| trade the next day. Failing to meet this | | | | judge what he would like the figures to show |
| target and the business is finished which is | | | | against what they actually show and take the |
| why financial control which can be provided | | | | necessary action to change the future and |
| by accounting software should be regarded by | | | | produce the desired result. Without financial |
| the small business management as an essential | | | | control the entrepreneur works in the dark |
| piece of kit. | | | | depending on hunches more than financial |
| | | | facts. |
| Suitable small business software is available | | | | |
| to suit every type of business and can vary | | | | No matter how good or bad a business is the |
| from a simple spreadsheet arrangement to | | | | cash flow or lack of it might well determine |
| sophisticated databases. The choice to adopt | | | | future growth or in the worst case scenario, |
| a solid financial control system is vital to | | | | poor liquidity can affect survival. Many |
| ensure sales are high enough to generate | | | | small businesses that do not use a small |
| profits, gross margins are sufficient, | | | | business accounting solution package and run |
| expenses are controlled, net profits are | | | | into difficulties have often been in |
| generated, cash flow is under control and | | | | financial problems for many months before it |
| losses can be identified and reversed or | | | | is obvious as reductions in profitability are |
| halted. No large business would survive | | | | hidden by extended credit from suppliers or |
| without a sophisticated system of financial | | | | tightening credit lines with customers. |
| control and small businesses have the same | | | | |
| requirements albeit on a different scale but | | | | Small business accounting software can |
| usually with more devastating effects. | | | | indicate which parts of the business are |
| | | | doing well, where action is needed if |
| Operating the finance function of a small | | | | underperforming and may also indicate where |
| business may seem to be an administrative | | | | action needs to be taken. Accurate control of |
| burden but is actually a vital tool to assist | | | | money owed in and money owed out is extremely |
| the generation of safer stronger profits | | | | difficult without the information to know how |
| growth and the early warning system of | | | | significant these figures are. |
| dealing with problems if the business does | | | | Underperformance can be critical and the |
| not perform. | | | | earliest warning provided by a small business |
| | | | accounting package can alert the management |
| Use the small business accounting software to | | | | to make corrective changes and improve |
| update the financial records at least once | | | | financial performance. |
| each month. With sales recorded every month | | | | |
| peaks and troughs in performance are obvious | | | | A disadvantage of small business accounting |
| and can then be examined to replicate those | | | | software is that it may sound like a foreign |
| actions that produced higher sales levels and | | | | language to non accountants but it does not |
| cut out those actions which produced lesser | | | | have to be difficult to use. Accounting |
| results. The result hopefully being sustained | | | | software using a database can require some |
| sales growth. | | | | bookkeeping skills but there are other |
| | | | alternatives. A small business accounting |
| Record all the costs each month and as with | | | | software solution written on excel |
| sales the trend to higher costs or more | | | | spreadsheets that produces all the main |
| efficient cost control will be evident from | | | | requirements with all transactions visible |
| the financial accounts. Also of importance | | | | can be an ideal solution for the small |
| will be the profit margin being achieved and | | | | businesses with little or no bookkeeping or |
| this can be viewed against the level of sales | | | | accounting knowledge and experience. |