Are Your Business Accounting Services Dragging You Down?

No matter how successful your business is, you won't stay in business if your accounting practices are not up to speed.

Customers with credit will pay late or not at all, and you may miss your own payments because of lack of funds.

At the very least, you will pay higher interest because you cannot pay on time or you have to borrow from a line of credit.

Automate

The first step is to find an automated system that works for you. Give up the idea of pen and ledger for something more up to date.

Ideally, your system will handle all of the accounting tasks for you, like sending out statements and reminders to your customers and payments to your vendors.

Automated systems can be as complex or as simple as you want.

The goal is to find an easy way to track everything so you know the financial status of your business at any given time.

Keep It Simple

Set up procedures for collection efforts for all of your customers. Don't have one way to do things with certain customers and another way for everyone else.

Of course, you may have some customers who qualify for credit and others who do not, but each customer in the group should be treated the same way. If you send out 15-day reminders, make sure everyone gets one if they have a balance.

Part of the concept of keeping things simple also pertains to the information you provide to your customers.

As the article, “Will Price Transparency Simplify Healthcare Accounting Services?” says, you need to be clear about what products or services were provided. When a customer can't understand a bill, he or she may take longer to pay it.

Providing costs upfront before the customer makes a purchasing decision is also essential for timely payment. Instead of trying to hide any fees, let the customer know ahead of time.

This ensures that he or she is prepared for the final bill, is able and willing to pay it and will be more likely to remit payment quickly.

Accounts Payable

Make sure your accounts payable runs as smoothly as accounts receivable. Keep track of vendor discounts and set them up to pay to get the best rate.

For instance, make sure all vendors who offer discounts are paid within that time frame. Don't just pay by the due date when you can save money by paying early.

Bulk orders also help reduce costs.

Find out when vendors offer sales and discounts or for what amounts. Take advantage of special programs or offers to reduce your overhead. When you cut your costs, you enjoy more profit from your revenue.

Every business, no matter how large or how small, needs to review its accounting procedures and services periodically to ensure optimal efficiency.

How your accounting department works directly impacts how successful and solvent your company will be. To stay in business for the long term, your accounting must be in order.