Basic Bookkeeping for Better Business

I don’t think anyone has ever said owning and operating a business is easy, so let’s stop for a moment and take a look behind the scenes through basic bookkeeping.

At the end of the day you want your product and services to be the best, second to none for all the obvious reasons such as customer or client satisfaction, repeat and recurring business, word of mouth and referrals, self pride in your chosen craft or profession and the bottom line to make a profit. So how do you keep track and analyse the cost of the process, well it’s simple and this is where a little basic bookkeeping can be essentially helpful. Please allow me to try and explain in the following scenario.see it from http://lacrossetribune.com/places/offers/let-us-audit-your-business-for-you-watermark-tax-bookkeeping/article_ca97faf2-8da6-11e3-b679-0019bb2963f4.html

Let’s say you are the owner of a licensed restaurant you need to know your cost from the time a patron walks in and places an order to the time that person thanks the waiter (and hopefully tips) and compliments the chef. Meaning this, they choose a reasonably priced meal from your designed menu and order some fine wine great. So let’s look at the breakdown and keep it basic for now. The price you paid for the produce like meat, potatoes, vegetables, spices, sauces and such. Then add-on the preparation and cooking expenses such as gas, electricity and include room lighting and the washing up.

Now look at staff wages involved kitchen hands, chef, waiters and bar staff and of course the wine itself. Are you starting to see that this reasonably priced meal may not be as profitable as you may think? Ok that’s just basing it on cost of goods sold to one customer, it does not matter if it is table for one or one hundred you still need to know profit/loss and costing. It is with the knowledge and understanding of this information that will help towards a better business.

You want to keep the books for your own business and as the rising cost of professional accountants escalates many of these businesses find it hard to maintain or afford professional assistance and advice to suit their individual business structure. So basic bookkeeping methods and skills are a valuable asset and no matter what the software the principles are the same. Amongst all the tools a business must have in order to survive and achieve success is information in regards to the financial situation of the company and statistics reveal it is often too late before the majority of small businesses realise the importance of learning the basics of proper bookkeeping procedures.

Basic Bookkeeping for Better Business

To sum it up simple things like learning how to access reports and understand what they are telling you, knowing how much you are owed and what you owe. All business owners should be able to access basic financial information from their record keeping software in order to maintain a healthy cash flow. It can be said that a business owner and sometimes management staff wear several hats and financial control through the knowledge of bookkeeping procedures, methods and software is the hat that should be head of the list. So if you find the numbers are not stacking up the way they should then it’s time you learn why and look behind the scenes for better business success.

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