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Maximize Your Profits With Bookkeeping: How To Get the Valuable Info Your Financial Records Are Hiding

Your financial records hold the key to profitability in your business. Want to know how to find that key? Any time of year, but especially during tax season, this valuable insight is available to you. All you have to do is review your financial records.

Let’s take a look at the steps you need to take to get this information. Good bookkeeping practices can help you unlock profits!

Step 1: Review Your Financial Records

This is something you can do anytime of year, but it may be particularly easy to do during tax season, or at the end of the year when you’re reviewing. Take a look through your past financial records, with an eye to sales.

If you do not have your bookkeeping up to date, this is a good time to pause and get that done first! This will help you move through the rest of the process.

Specifically, it’s important to take a look at two things: which time of year and which offerings bring in the most revenue.

Step 2: Take Note of Time Cycles and Best Offerings

By studying your financial records with an eye to times of the year, you can learn a lot about how your business behaves over time. Whether your business is product- or service-based, it is likely subject to fluctuations. It’s likely that these fluctuations are seasonal, or else focused on specific events.

For example, let’s say you own a craft business that brings in the most revenue in the spring and early winter. If you look closely at your records and what you’re doing in your business throughout the year, you might realize these spikes in revenue come from particular sources. In a craft business, it might be that there are several public craft fairs you like to attend in the spring. In early winter, perhaps people buy your products as Christmas gifts. (For some advice specifically about craft fairs, please check out this post!)

By analyzing your financial records, it becomes more apparent to you what times of the year and what offerings bring in more revenue. This makes it easier to direct your energy towards maximizing your profits.

Step 3: Using this Info

Now that you’re clear on the products or services that bring you the most revenue, as well as the time of year, events, or other factors that effect this, it’s time to put this info into action. How can you re-create these conditions to bring in more revenue?

For example, perhaps you have one product that’s particularly popular – can you create variations of this product? Maybe it’s especially popular during summer – can you do extra promotions or bring in more stock? How can you expand here?

Ask yourself the questions above, and think about what results you’d like to achieve. Would you like more revenue? More sales of a certain offering? Or perhaps you’re just not clear about what’s working best in your business. Analyzing your financial records can help you figure this out.

Once you’re clear on what your goals are, and what offerings and times of year are the moneymakers in your business, you can put together a strategy based on your findings to create more profitability in your business.

Conclusion

To maximize your profits, focus your business’s energy towards your most profitable offerings and times of year. Reviewing your financial records will help you determine this information.

This is also one of many things a good bookkeeper can help you discern from your records, and something that I regularly do with my clients. If you’d like some support in this process, you are welcome to schedule a curiosity call with me.

Use Clear Record-Keeping To Amplify Your Business Profits: Here’s How

You’ve probably heard the saying, “Where attention goes, energy flows.” This quote, which I first heard from Michael Bernard Beckwith, perfectly describes the relationship between you and your finances. The more you pay attention to them, the more you will see growth and change. I’ve seen this happen with clients over and over.

This is especially the case with record-keeping. Regularly tending to an organized bookkeeping system for your business will have a positive impact on your bottom line. This is something you see the best results with if you stick with it long-term. It requires effort on the front end to set up a system that works for you. And, it’s absolutely worth it. Let’s talk about the how and the why of clear record-keeping.

How Do I Keep Clear Records?

First, separate your business finances from your personal finances. There are many excellent reasons to do this, and two different methods that I recommend to clients based on the size of their business. You can read all about that here.

Next, set up a system. You might think this just means finding some record-keeping software, but we’ll get to that in a minute. Your software is just one part of your larger money system. What you want to do at this stage is set up a money map to help you visualize where money goes in your business. You can read my full series on money mapping here.

Once you’ve visualized and established an overall flow of money in your business, get into the nitty gritty and set up your software. My top two recommendations for business tracking are MoneyGrit.(R) and QuickBooks Online. I wrote a longer post comparing softwares that you can read here to get more info about both.

Finally, I highly recommend consulting with a professional to review your system and make sure everything is set up properly. Reviewing your books with a bookkeeper a few times a year can also be beneficial. You can read my article on working with a bookkeeper to learn more.

Now that we’re clear on the how, let’s talk about why prioritizing clear record-keeping can benefit your business.

Analyze Your Data

Your financial record-keeping is a data source in your business. By having clear records, you can start to trace the revenue trends in your business. You can use this data to analyze what offerings are the most profitable, and what expenses bring you the best returns. If you want to know more about this, read my article on how to focus your offerings to create more revenue.

Reduce Stress at Tax Time

Besides offering you key insights that can help you create a more profitable business, clear record-keeping also makes all your necessary tax-time info readily available. This can be a time- and money-saver, because you don’t have to hire someone else to untangle your mess at the last minute. Besides those obvious savings, the value of reducing your stress is also not to be underestimated!

If you appreciated learning about clear-record keeping and want to take the next step in setting up your system, you might consider working with me to do a Quickbooks training. I love working with solopreneurs to make sure they are set up for success. Schedule a free Financial Self Care Consultation here!

Angela