I speak to around 100 new startups every month and while they are excited about the opportunity ahead of them, they are often overwhelmed by the things they have to do to get their business started.
Having a system like Quickbooks Online Plus to work with makes it seriously easy to get organised. The business owner can track money coming and going out of their business without needing to have a university degree in accounting. The golden rule for business is to make sure the money coming into your business (the sales cycle) is happening faster than the money going out of your business (the purchases cycle). One way of doing this is to buy on credit and sell for cash, but unfortunately many business startups do the opposite. This is why having an accounting program is so important.
It’s as simple as using the ‘Money Bar’ to illustrate the purchase cycle, giving a visual display (in terms of dollar value and number of documents) of what’s been ordered, what’s still to be paid, what’s overdue and what was paid in the last 30 days. This is invaluable information for business owners to safeguard their cash flow and to see at a glance what bills are overdue.
An example would be a fencing contractor who is doing on average two jobs a week, but is booked up for a month in advance. They need to order materials for jobs they will be doing the next week with specific instructions of quantity and type of material for each job, as well as delivery instructions and the terms of payment offered by the supplier. Quickbooks Online Plus lets you create detailed orders that can be sent to your supplier…
…and then converted to a bill with a single click in the ‘Action’ column next to each order.
There is no need to pay a bill before it is due as the Money Bar will clearly show which bills are overdue, thus maximising the cash flow. One click on ‘Suppliers’ in the Navigator Bar to left of the screen will show this information instantly.
The sales cycle is also shown (in terms of dollar value and number of documents) displaying quotes and unbilled activities – sales invoices that are yet to be paid and those that are overdue, as well as invoices that have been paid in the last 30 days. By clicking on any part of the Money Bar a filter will be made of documents meeting that criterion.
Using the example of our fencing contractor again, they would be giving several quotes a week which they need to access quickly and convert to invoices once the customer gives them the go ahead. For an excellent illustration of how quotes are done in Quickbooks Online, please see Priscilla Meli’s blog.
The time between doing the job, issuing an invoice and getting paid is critical to cash flow, so the faster this is done the quicker the sales cycle. Quickbooks Online provides you with a quick visual summary of where each customer is in terms of sales. To see all the overdue invoices, just click on the red section of the Money Bar to get a listing of all overdue sales invoices.
Another great time saver is the ‘Action’ assigned to each Supplier or Customer depending on the stage of the purchase or sales cycle you are in. This cuts down on the number of steps required in the transaction process and provides an intelligent and intuitive aspect that helps the new business user.
For new business startups it is often difficult to be across everything that is happening in their business. Quickbooks Online helps startups monitor the financial flows essential to their business’s success. It gives the business owner the focus they need to monitor their dealings with suppliers, keeps track of where they are with their customers and shows an intuitive next step in the transaction process.