So, at some point, you chose software to run your business.
Maybe because you had to, to comply with the new rules for MTD, maybe because your accountant told you to (!) or maybe you just felt you needed to as that’s what businesses do.
So, you are paying for this tool, this software, but is this software working for you? Are you using it to its full potential? Is it giving you the information you need to run your business to maximum effect?
It might be that you have the correct software, but you need to step back and review your processes. Could you use additional features which you are already paying for but just haven’t started using? Could you build in efficiencies and use features to streamline your processes and give you more timely/accurate information? These are all things we can help evaluate, initiate and support you through.
To help you evaluate if your software is working to its full potential, there are two key areas to consider. There’s the ‘front of house’ or operations side of things and then there’s the accounts function.
The operational side is where you record your sales orders/invoices, maintain your customers, handle stock and other costs associated with whatever you sell as a business. This part of the program should help drive your business to run on a day-to-day basis and you should be able to generate reports to see which areas of sales are most profitable, if you are pricing your products/services at an appropriate level and if you are making the anticipated Gross Profit Margin for your market.
The ‘back office’, or ‘accounting’ side, is where you maintain your debtors, creditors, record bank transactions, oversee your bank balances and perform compliance work like VAT returns, EC Sales lists and Intrastat reporting. You should also be obtaining Management Information from this side of the software as this will provide you with an overview of the business as a whole. This information will bring together the profits that you are making and adjust these for business overheads, so you can assess whether you’re actually making any money!
What format of software should you choose?
If you decide your current software isn’t working for you, how do you decide what will? Some businesses choose a piece of industry specific software that works exactly as they need it to from a ‘front of house’ perspective. However, these can be a bit lacking in accounting functionality and offer limited Management Accounts information.
Likewise, some businesses choose a piece of accounting software to ensure detailed Management Information and concise compliance work but have fallen into the trap of using spreadsheets to perform their ‘front of house’ operations.
Ideally, you want the best of both worlds and this can be achieved by choosing an industry specific, fit-for-purpose front of house software and link that (electronically) with a piece of accounting software. This will provide you with the streamlining you need from an operational perspective but it’s robust and detailed enough from an accounting perspective. A well-linked system will be able to provide a huge amount of detail and comparative figures to enable you to assess how your business is running in real time and to make quick decisions if things are going astray.
The Ensors Business Support Services team include staff who have used and experienced many different software systems. They are familiar with how databases work and are experienced accountants, so they know what the figures all mean! If you would like advice on new software or would like someone to come and discuss your existing systems and review your processes, please speak to us.