For the uninitiated, the idea of managing your business’s accounts can be a daunting prospect. Thankfully, the reality is actually a lot easier, especially in the era of all-in-one accounting software and google search. Managing your accounts is totally within the reach of any business owner and can offer very important insights into the operations of your business.
Understand your accounts
The hardest part about effective account management is learning the terminology and logic which underlie modern accounting techniques. Start with simple guides like this, and consider investing in a diy accounting book like Accounting for Dummies. Take your time, Google everything, and make notes. Before long, you’ll be an accounting whizz! As your understanding matures, you can move on to putting your knowledge into practice.
Choose some accounting software and learn it inside out
There is a plethora of accounting software, ranging from comprehensive tools aimed at medium to large scale corporations, right down to simple phone app style offerings that provide the bare minimum. As always, the happy middle is probably the best place to be.
MYOB is a very popular tool, with a massive range of resources available online to help you get to grips with it – here is a breakdown of five popular offerings on the market at the moment.
Though the initial learning curve can be rather steep, once you’re familiar with your accounting software, you’ll find that you save massive amounts of time and make far fewer mistakes than if you tried to track invoices and payments manually.
Review your costs
Now that you’ve got a solid foundation of knowledge and tools laid, you can begin to get your hands dirty. The best place to start is by taking stock of your business’s costs.
Understanding where your money is going is absolutely critical to taking control of your gym’s accounts. Analysing this information gives you the ability to reduce waste, and improve the overall profitability of your business.
Differentiate between fixed and variable costs. Fixed costs (as the name suggests) are costs that are more or less inevitable. On the other hand, variable costs represent areas in which money can be saved.
Monitor the performance of your business
As a careful and prudent business owner, keeping a close eye on your finances is second nature. Keeping an eye on cash flow, expenses and revenue will allow you to accurately forecast and account for the future of your business.
A valuable tool in your arsenal here is detailed record keeping. By comparing previous years data with current numbers, you can generate an accurate idea of the direction in which your business is heading.
Keep your personal finances separate
It is a good rule of thumb to try and pay yourself a wage from day one. Even if this is not a huge amount of money, this provides a safety buffer in the event of any serious issues with your business. That being said, it definitely pays to be frugal – any money that you take out of your business now will restrict its growth in the future.
In addition, get a business credit card for miscellaneous expenses and open a business savings account. Putting small amounts of money into your business savings account here and there can add up over time – and really save the day if any unexpected expenses pop up at the wrong moment.
Speak to a professional
If this all seems far too difficult, or account management is starting to take up too much of your day, it might be time to speak to a professional accountant. Even if it is only a consultation, the insight of a trained and experienced professional can provide a lot of value, and serve to highlight any shortcomings in your current financial management strategies.
Learning new skills and developing old ones is all part of what makes small business ownership so rewarding and exciting. If you’re the sort of person that relishes a challenge and isn’t afraid to get their hands dirty, consider a Fitstop franchise! Our network of successful, owner operated gyms is growing rapidly – for more info check out www.fsfitness.com.au/franchising.