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