While accounting is an important part of any business, it’s particularly important when you have an interior design business. You need to accurately estimate how much projects are going to cost, and since you receive money up front, you also need to make sure you allocate funds correctly to avoid going over budget. Consider keeping track of your business’ finances with these interior design accounting tips.
Record all Your Expenses Individually
The best way to ensure there are no issues regarding expenses is to get everything in writing. Before you start a project, put together a contract so your client knows exactly what you’re doing and what is being billed. This prevents any confusion later and protects both parties. When you order from your suppliers, consider using purchase orders. Not only does this make it easier for you to account for those expenses and notice any order errors immediately, it also simplifies the order fulfillment process for your supplier. You want to keep all your receipts from suppliers and for any other expenses related to a project. For example, if you paid for parking when you picked up supplies, hang on to that receipt as you can add it to your client’s invoice. By recording all your expenses and keeping receipts, you have documentation in case the client audits you.
Always Track Your Time
Since you’re billing by the hour, tracking your time correctly ensures you don’t end up losing money by working without recording your hours. While this seems like a no-brainer, far too often interior designers skip tracking their time, especially when it’s a small amount. It may not seem like a big deal to track 15 or 20 minutes of work, but do this enough, and you could end up working several hours without pay. The simplest way to track your time is by using an app. TSheets Time Tracking is one easy-to-use option that syncs up with QuickBooks so you can quickly add hours to client invoices. There are also programs available that you can use on computers, although mobile apps tend to be better for interior design since you’re often out of the office.
Get Assistance When Necessary
Handling your business’ accounting on your own saves you the money you would have spent on an accountant, but it can cost you valuable time and result in expensive mistakes. If you don’t have the accounting knowledge to do it alone, it’s in your best interest to hire an accountant to help out. You may also consider upgrading your accounting software to a program that has more features. Don’t let accounting issues cost you money or negatively affect your relationship with your clients. By keeping track of your time and cataloguing all your expenses, you get paid the right amount, and your clients don’t get any surprises when they receive their invoices.