Did you know that your accountant can help you grow your business profit? Many business owners don’t realise the many benefits a good accountant can bring to their personal and business life. They can offer strategic advice and clever ways to boost revenue and save money. They not only remove and automate administrative tasks to help you focus on your core business, they also help you run your business with more confidence and clarity. Get them involved and utilise their knowledge as well as their years of valuable experience in growing businesses for numerous other owners.
In addition to filing your BAS statements and tax returns, your accountant can be a trusted advisor – providing you with valuable advice across business functions to help improve your profit, trim down your costs and streamline your business. He or she should be available to you all year to offer regular advice and know your business inside out.
Here’s a list of things your accountant should do to help you grow your business.
Cost reduction strategy
Your accountant should analyse all your operating expenses and determine which ones are high based on industry benchmarks. Saving dollars by analysing your operating costs will directly translate to more profit for you. Your costs have a huge impact on your profitability so you should not neglect keeping a close eye on them.
Your accountant should implement an effective cost reduction strategy based on benchmarking intelligence. He or she should help you improve the management of your contracts, reduce overheads and waste and boost productivity across your organisation. Your accountant should find out how you can utilise your labour more efficiently. If you can save on wages and labour costs such as superannuation and work cover, your profit will grow. He or she should also calculate the return rate for your marketing and advertising spend to see if it generates enough sales and profit for the business. Your accountant should think about storage, utilities and staff costs strategically to identify unnecessary costs in your business. Your accountant should find out if you can negotiate a better deal with your suppliers.
You need a detailed budget but creating one consumes a lot of time and energy. Don’t work off a vague set of numbers that are full of rough estimates and assumptions. Your accountant should be able to produce an accurate, rigorous budget that you can be confident of. He or she should show you the real cost of doing your business, how much you can reinvest and what you can pay yourself.
If your budget blows out, your profits dwindle away. Your accountant should have a deep understanding of your business and market position to help you set achievable and reliable revenue and budget targets. He or she should be able to identify your costs, implement and monitor a realistic budget that’s aligned with your goals and forecast your sales.
Debt collection system
Your accountant should develop an effective debt collection system for you to make sure that your business does not suffer losses because of bad debts. Bad debts eat away profits so your accountant should fix and improve your debt collection policies and implement better terms of trade to maximise your profits and improve your cash flow.
You don’t need to chase your debtors but unpaid invoices are inherent in business and you can’t just ignore the problem. Your accountant should take care of that for you. He or she should set up invoice systems that send automatic reminders to your customers when bills are due or overdue. He or she can even call them if they do not respond to emails. If invoices still remain unpaid, your accountant may arrange for debt financing where a business will pay for these invoices and chase the payment themselves.
It’s not easy to apply for a loan as it involves art and science. Your accountant should be able to pull together your numbers and help you pitch loan applications. Lenders want solid financials and credible forecasts and your accountant should create a compelling presentation with graphs and charts to sell your business. He or she should be able to use powerful tools that loan officers trust.
Your accountant should also help you tell a good debt from a bad debt and find the least expensive borrowing strategies with low interest and repayment flexibility for your business. He or she should take care of refinancing as well. Your accountant should look at finance restructuring and help you save interest on your loans should there be cheaper options. You can boost your profit if you refinance an existing business debt and save interest. He or she will advise you when your spare cash should be used to pay loans or be reinvested in your business by considering the figures, looking at how you debt is structured and developing the right strategy for you.
Launching a new business can be exciting as well but it takes more than just a good idea. You need to know and convince investors and lenders that it can make money. Your accountant should help test the idea, identify all startup and operating costs and produce credible sales forecasts. He or she should know which lenders are most suitable so you can approach them for finance. He or she should be able to work on your pitch so you can impress the lenders.
Product / service and price analysis
Your accountant should review any underperforming product or service lines in your business. He or she should review margin levels and find out which ones should be eliminated because they are poorly contributing to your bottom line.
Your accountant should review your pricing, determine if your prices are in tune with market expectations and maximise your current price levels. If a price increase is due, it might just significantly boost your profit.
Setting price points is critical to the success of your business. If your price is too high or too low, you’ll be out of the game. Your accountant should help you set competitive price points based on benchmarking intelligence while keeping enough meat in your bottom line.
Your accountant should spend time with you to prepare a flexible business plan that sets key goals and courses of action for future profit growth. He or she should be proactive in helping you find opportunities to improve key areas in your business. Your accountant is responsible for managing your cash flow, maximising your profits and helping solve any business issues that you may have through honest and practical advice.
Your accountant should help make your business recession proof, safe from the pressures on prices, high inflation and low interest rates. He or she should produce regular forecasts to make sure you avoid financial difficulties and that your plans are fully funded all the time.
A business has many moving parts and it could be difficult to know where to focus. Your accountant should help you determine what’s important, set personal, professional and financial goals and give you tools to track your progress. Your accountant should also help you set up your accounting software so you can check your KPIs anytime, anywhere. He or she should be able to troubleshoot issues, test solutions and reset KPIs for you as needed.
Customer and revenue analysis
Your accountant should help you identify which customers are most valuable to your business by looking at your complete customer database and analysing the profitability of each customer. You might be surprised to know that the ones who give you the least headaches may actually be the ones who give you the most margin and profit – so don’t ignore them.
Your accountant should offer proactive tax planning to save money off annual tax bills. You would need that money to reinvest into the business and achieve the income you want. Your accountant should use strategies to identify the most tax efficient structures for your business.
Your accountant should know what is happening in your industry and understand where your business sits in the market. He or she should research and offer insight into your industry to identify areas where you can easily improve and grow. Your accountant should compare you with your competitors.
You should know how your competitors are operating so you can outpace them. Your accountant should report to you how you stack up on sales volume, production costs, market reach, overhead, staff costs and turnover, profitability and pricing, etc. Knowing this vital information will help you identify your pain points and tell you where you can reduce costs or if there are market gaps in your sales strategy so you can set a more effective business strategy that will give you more edge.
Cash flow management
Even profitable businesses fail because they run out of cash at the wrong time and can’t pay suppliers or staff. businesses can’t last long no matter how profitable if payments are slow or expenditure is too high. Your accountant should know that revenue and costs come and go. They should help you forecast your cash flow and come up with strategies to manage it by organising cash reserves and a spending plan to make sure there’s always money in the bank. You’ll develop an easier relationship with your suppliers and staff.
Your accountant should automate your business accounting so sales and expense data can flow directly to your accounts. He or she should set up your invoicing systems that tell you what has been paid and what hasn’t. A good cloud accounting software can even send reminder emails to those who haven’t paid you.
Your accountant should help you automate cash flow dashboards, KPI tracking and accounts payable and set up mobile accounting apps to let you manage your finances anytime, anywhere. This will allow you to check your business performance, know where you stand and make sure you’re on top of your expenses even when on the road.
Your accountant should also set up an inventory system, identify the cost of holding inventory and develop strategies to save you money. He or she should help you avoid spending a lot on storage, losing money writing off damaged or obsolete goods or losing revenue because you run out of stock. Your accountant should help you manage your inventory properly, check your sales data to predict stock needs and even set up an automated tracking of stock levels and ordering of items as they run low.
Your accountant should help take away other unnecessary distractions by automating things such as staff scheduling and time recording, POS, payments, customer relationship management, payroll and invoicing. This practice can take away the stress, lower costs and ensure everything runs smoothly.
Make sure your accountant is stepping up to the plate in these areas because anything less is simply not good enough.
As a business owner, you are probably working far too hard because everything depends on you. Your accountant should help bring balance to your life and help you achieve the quality of life you want. You may want to sell your business, retire as a silent partner or leave it to your kids. Your accountant should be a trusted adviser with extensive knowledge about tax minimisation strategies, tax compliance, due diligence, business valuation and estate planning.
Need a bit of assistance with your hospitality business? Contact a Sky Accountants representative today and learn more about our fixed fees. You won’t regret it.
Some of our clients include Buckley’s Entertainment Center, Ballarat Leagues Club, Daylesford Hotel, Bacchus Marsh Golf Club, Campbell Point House, Midlands Ballarat, The Urban Newtown, Maryborough Midland Society, Brink Drinks, Dontek, UV Wraps and many more.
Aside from business consultation, we also offer accounting, bookkeeping, back office, SMSF and POS services designed to help you achieve greater financial success.
Here are three ways we help hospitality business owners grow their business:
- Download our FREE Hospitality Calculators eBook here
- Take our free online assessment and see how much your business is currently worth (free 30page detailed report included)
- If you are looking to change Accountants or need advice on how to grow your business, organise a 1on1 session with a Sky Business Expert here
Email Address: email@example.com
Accountants Ballarat Office
Phone: 1300 328 855
Office Address: 902 Howitt Street, Wendouree, Victoria 3355, Australia
Postal Address: PO Box 2234, Bakery Hill, Victoria 3354
Accountants Sunbury Office
Phone: 03 97444522
Fax: 03 97447004
Office Address: Suite 13, Building B, Sunbury Corporate Centre, 33-35 Macedon Street, SUNBURY VIC 3429
Postal Address: PO Box 222 Sunbury, Victoria 3429