Running a small business isn’t easy. There are sales to make, marketing campaigns to run, employees to manage, a website to maintain, and much more. It’s no surprise that Bank of America reported that small business owners said managing their business is more than four times more stressful than raising their children. If that wasn’t enough stress, one of the most dreaded tasks for small business owners is accounting and business tax compliance.
Faced with the demands of running a small business, many entrepreneurs quickly realize that accounting software makes the process easier, and that there are numerous other benefits. If you’re still on the fence about using a small business accounting software, keep reading to learn why this technology is a must-have for any small business.
Accurate accounting is the key to truly understanding your business’s performance and financial health, but even a minuscule error can massively impact your final balance. Accounting software reduces these errors because all the mathematical calculations are done by the computer, not by hand. Manual data entry still requires incredible attention to detail, but accounting automation software can take your accuracy to the next level.
There’s no denying that manual accounting is a slow, laborious process. The human brain can only calculate so quickly, whereas computers do the work instantly. Why not let technology handle the math so you can increase your team’s speed and efficiency? You’ll be much more nimble without the backlog of busywork, and you’ll be able to focus on other areas of your business.
Reduced Total Costs
Time is money, as the saying goes, so time saved with accounting software is money saved as well. Your team will operate much more efficiently, executing on more projects in less time because they’re no longer bogged down with manual tasks. Beyond that, you might even be able to downsize your team or move team members into more specialized roles.
Accounting reports give business owners timely and accurate financial information, but they are time-consuming to fill out by hand. (This is problematic in situations when you need a report within an hour or two.) Accounting software provides automated reporting for a real-time look at how your business is doing. You can generate them on-demand or have them sent to your inbox at regular intervals.
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Easier Tax Filing
Tax season arrives in haste every spring, and plenty of business owners are left scrambling to track down all their transactions from the previous year. Don’t let that be you. The beauty of accounting software is that it keeps a record of all your sales, returns, expenses, fees, and more—so you can file with little to no effort required.
Improved Financial Control
As we noted in our guide to choosing a bookkeeper, you’re probably not an accounting expert if you’re running an ecommerce business. Fortunately, an accounting background isn’t necessary to keep balanced, accurate books. You can do your own accounting once you learn the basics of accounting software. This gives you financial control (and is a great learning experience) until it’s time to outsource your accounting.
Effective Decision Making
The reports you get from your accounting software give you an honest look at where your money is going and how big the returns are. Armed with the information, you can then make smarter, more effective decisions about which expenses to cut and where to invest instead.
Protected Financial Data
When you use accounting software, your data is encrypted and protected according to GDPR standards. Online security is a priority for all reputable financial institutions, so your data will be safe. Additionally, accounting software is only accessible to your teammates who have the login credentials, so there is an added security layer.
As your business grows, you’ll accumulate more data that you can use to identify patterns and seasonality trends. Use these numbers for precise forecasting so you’ll know when to scale back on marketing spend, when your customers are most active, and when your promotional offerings will make the most impact. Planning for the future doesn’t have to be a guessing game.
Are you ready to eliminate all the busywork between your sales channels and your accounting systems? Take Webgility for a spin FREE for 15-days. No software installations required. No credit card required. Create a free account to get started right away.