Options to Boost Your Business in 2014

As the year comes to an end, you can celebrate the triumphs and try to forget about the tribulations. But wise business owners are careful that only the good experiences turn into company policy. And they hope for more of these in the coming year.

Good experiences usually grow out of information from a highly functional accounting system. Because businesses change over time, entrepreneurs must ensure that their accounting methods are relevant to their operations. So consider some of these options for a happy and profitable 2014.

Entrepreneurs who handle their own bookkeeping and have someone else smooth out the inaccuracies later may find the lag time too long to get decent usable data for analysis and decision-making. Improvements in the bookkeeping process may be necessary.

You could hire an in-house bookkeeper, but the less costly solution is using additional outside bookkeeping services. Outside accounting professionals will have fast and easy access to your financial data if you use electronic data sharing to securely transmit data backup files.

Evolve to the cloud

However, a more advanced technique is operating your accounting program, such as QuickBooks, on a cloud platform. The data is therefore available immediately to you and your financial team. The changeover will cause a short-term procedural interruption and extra cost, but the results deliver an efficient low-cost solution for the long term.

The ability to upload files to a cloud environment also improves convenience for outsourcing more tasks. For instance, you can hire freelance talent from anywhere to write promotional materials or new website content. Their work is simply uploaded to the cloud, from where you can retrieve it.

Form management

You can manage your forms much more efficiently through the cloud using, for example, Google Drive. By storing commonly used forms on Google Drive, you need only print them as needed. This function permits you flexibility, as a document can be modified quickly and put into use almost immediately. You’ll save money by printing only what you need at the time, and having fewer forms to stock also reduces the amount of storage space required.

Execute revised pricing

The start of a new year is also the ideal time to review your prices. Consumers usually appreciate a straightforward price with no extras. Therefore, you can improve customer relations by initiating flat pricing that eliminates shipping charges, as well as the fees you incur and pass on to purchasers.

This can increase sales without implementing cost-cutting measures, most of which you’ve probably already used in the past. When your price is slightly above the average price of your competitors, this tends to create a perception of higher value on the part of consumers.

Additionally, your corporate image will benefit from the increased “goodwill” that usually results when you introduce straight-forward pricing. And that can’t hurt sales, either.

To make informed decisions on options such as revising your pricing structure, you will need reliable financial information, and perhaps the perspective of your accounting professional. Make 2014 a year of good experiences.

How to Answer the Question: How Much Inventory do I Need

Businesses that carry inventory constantly struggle to determine the ideal level of product to hold. Even if your business doesn’t have seasonal sales fluctuations, many operations must increase inventory at year-end to accommodate higher holiday sales. The conclusion is that the right amount of inventory for any business is the quantity needed to meet customer demand.

No business owner wants to turn away customers because of insufficient inventory. Nor does he or she want to pay premium prices and rush delivery charges to replace sold-out stock. On the other hand, holding too much inventory ties up your cash and complicates physical inventory counts.

Particularly with a seasonal operation, you must consider varying sales volume in different periods. And while you can’t predict future sales, you can use prior periods as guidelines. Your financial data holds the key to determining whether your inventory level is sound.

Financial records can tell you how much inventory is sold every month, quarter, or year, and show you how much you sell of each inventory item or category.

Start the process by finding out the cost of inventory sold in an accounting period. Divide this amount by the cost of current inventory on hand. Then, divide the number of days in the accounting period by the result. This gives you the number of days historically required to sell your present inventory.

Compare this result to prior months. While a steady figure is usually desirable, a rising trend is satisfactory if your company’s sales are growing.