Leveraging Data to Make Informed Business Decisions: A Complete Guide for Small Business Owners

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Data-driven decision-making is crucial for small businesses looking to grow and streamline operations. By leveraging data for small business growth, you can transform how you manage customer trends, sales, and finances. This guide will show you how to leverage data to grow your business, streamline operations, and stay ahead of the competition.

The Key Types of Data Every Small Business Should Track

To make informed business decisions, it’s crucial to understand the kinds of data you can collect and how each can impact your business. Here are the key types you should focus on:

  • Customer Data: Understanding your customers is the cornerstone of growing your business. By tracking demographics, purchase history, and website behavior, you can offer personalized experiences and address common pain points. For example, analyzing customer behavior on your website might reveal visitors abandoning their carts at the checkout—helping you identify areas for improvement.
  • Sales Data: Sales data reveals what products or services are selling, when sales are peaking, and customer buying patterns. This data lets you plan your inventory, predict demand, and create targeted promotions. For instance, seasonal spikes in sales can guide your marketing efforts and help you prepare inventory for high-demand periods.
  • Financial Data: Your financial data is the heartbeat of your business. It includes revenue, expenses, profit margins, and cash flow. Reviewing financial reports regularly helps you pinpoint areas where you can cut costs or invest more strategically. Tools like QuickBooks or Xero make tracking this data in real time easy.
  • Operational Data: Includes inventory levels, supply chain metrics, employee performance, and process efficiency. For instance, monitoring inventory data can help you optimize stock levels and reduce the risk of stockouts or overstocking.
  • Marketing Data: Encompasses metrics like website traffic, social media engagement, email open rates, and conversion rates. Analyzing marketing data can help you refine your strategies, such as adjusting your ad spending based on which campaigns generate the highest return on investment.

How Data Can Help You Make Smarter Business Decisions

Data is more than just numbers; it’s a critical asset that can unlock valuable insights about your business. From understanding customer behavior to optimizing inventory, data reveals patterns and trends that might otherwise go unnoticed. Here’s how effectively using data can benefit small business owners:

  • Identify Opportunities: Spot emerging market trends, understand customer needs, and pinpoint areas for improvement. For instance, analyzing sales data on platforms like Google Analytics or Shopify Analytics might reveal an increasing demand for eco-friendly products, prompting you to expand your offerings.
  • Reduce Costs: Streamline operations, cut unnecessary expenses, and make smarter investments. Platforms like QuickBooks or Xero can help you track operational data, revealing inefficiencies such as delays in specific processes. With this insight, you can lower costs and improve productivity.
  • Enhance Customer Experience by Personalizing interactions, anticipating customer needs, and building loyalty. Tools like HubSpot or Salesforce allow you to analyze customer feedback and behavior data, helping you better tailor your services to meet customers’ expectations. For example, you can offer personalized product recommendations based on past purchases.
  • Improve Decision-Making: Base your strategic choices on solid evidence rather than assumptions. Up-to-date financial data from outsourced bookkeeping experts like xendoo or Zoho Books can help you make more accurate forecasts and budgets more effectively, reducing uncertainty in your planning. These insights allow you to steer your business confidently in the right direction.

Steps to Start Using Data for Informed Decision-Making

  • Step 1: Set Clear Objectives
    Define your data goals. Clear objectives will guide your data collection and analysis, whether you’re boosting sales, improving customer retention, or optimizing marketing strategies.
    Example: To improve customer retention, analyze data related to repeat purchase rates, customer satisfaction scores, and feedback from loyalty programs.
  • Step 2: Collect the Right Data
    Identify the data you need based on your objectives. Use tools such as CRM software, accounting platforms, point-of-sale systems, and Google Analytics to automate data collection and help organize it for analysis.
    For example, a retail store might use point-of-sale data to track sales trends and customer preferences. In contrast, an e-commerce business might use Google Analytics to understand online shopping behavior.
  • Step 3: Clean and Organize Your Data
    Ensure your data is accurate and consistent by removing duplicates, correcting errors, and standardizing formats. Clean data is essential for reliable analysis and decision-making.
    Example: If you consolidate sales data from different sources, ensure the data is formatted consistently to compare performance across channels accurately.
  • Step 4: Analyze the Data
    Look for trends, patterns, and insights that align with your goals. Use visualization tools like Tableau or Excel to create charts and graphs that simplify interpretation.
    Descriptive Analytics: Understand past performance. For example, analyze monthly sales trends to identify peak seasons and adjust inventory levels accordingly.
    Predictive Analytics: This technique uses historical data to forecast future outcomes. For instance, it analyzes past customer behavior to predict future buying patterns and adjust marketing strategies.
    Prescriptive Analytics: Based on analysis, recommend actions. If data shows that a particular marketing campaign drives high conversions, allocate more budget to that campaign.
    Example: A café owner notices a spike in iced coffee sales in the afternoon. They could run a targeted promotion during these hours to boost sales further.
  • Step 5: Make Data-Driven Decisions
    Base your decisions on the insights gained from your data analysis. Data-driven choices reduce risk and improve outcomes.
    Example: If sales data reveals a product is underperforming, you might consider discontinuing it or running a promotional campaign to clear inventory.
  • Step 6: Monitor and Adjust
    Business environments change, and so will your data. Keep monitoring and adjusting your strategies based on new data to stay on the path to success.
    Example: After revising pricing based on competitor analysis, monitor sales and customer feedback to ensure the changes benefit your customer base without alienating them.

Real-World Examples of Leveraging Data in Small Business

  • Retail Shop: Inventory Management Optimization
    A small boutique analyzed sales data to identify which clothing items were frequently out of stock and which were rarely sold. Based on this analysis, they adjusted their inventory orders, reducing overstock issues and keeping high-demand items in stock. This approach increased sales and improved customer satisfaction.
  • Restaurant: Enhancing Customer Experience
    A local restaurant used customer feedback data from surveys and online reviews to pinpoint long wait times during peak hours. Based on this feedback, they adjusted staffing schedules and optimized kitchen workflows, reducing wait times, higher customer satisfaction scores, and more repeat visits.
  • E-commerce Business: Personalizing Marketing Campaigns
    An online jewelry store segmented its email list using customer data to target frequent buyers with personalized product recommendations. This approach increased email open rates by 30% and boosted sales conversions.

Common Pitfalls to Avoid When Using  Data

  • Ignoring Data Quality: Ensure your data is accurate, complete, and up-to-date. Low-quality data can lead to misguided decisions.
  • Focusing on Vanity Metrics: Concentrate on metrics that directly impact your business goals, such as conversion rates and customer acquisition costs, rather than metrics that look good but offer little actionable insight.
  • Overcomplicating Analysis: Simple metrics can often provide the insights you need. Avoid overcomplicating your analysis with unnecessary details.

 

Leveraging data isn’t just for big companies. With the right approach, small business owners can use data to make informed decisions that drive growth, improve customer satisfaction, and streamline operations. Start by tracking the most relevant metrics, and you’ll soon see the benefits of data-driven decision-making in your business.

Want to improve your data analysis? xendoo can help by providing real-time financial insights and expert advice tailored to your unique business needs. Contact us today for a FREE 15-minute consultation!

 

7 Steps to An Easy Tax Time

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As tax season approaches, getting your financial documents and records in order is crucial to ensure a smooth and accurate filing process. Here’s a step-by-step guide to help you prepare effectively:

 

Obtain Your W-3 Form: 

Your W-3 form consolidates all individual W-2 forms, reporting employee wages and tax withholdings into one comprehensive document. This form, obtained from your payroll provider, ensures that the total wages and taxes you’ve reported match what the IRS has on file.

 

Gather Your 1099-K Forms: 

These forms report the total payments received through payment processors like Stripe or PayPal, confirming that your reported income matches what these platforms have reported to the IRS. Matching these forms with your financial records simplifies the filing process and helps avoid issues with your tax return. Payment process companies send these forms to you. 

 

Close Out Your Profit & Loss Statement and Balance Sheet: 

Closing out these documents verifies that all financial transactions are accounted for and that your records are complete. The Profit & Loss statement summarizes your income and expenses, indicating whether your business made a profit or incurred a loss and the Balance Sheet details what your business owns and owes.

 

Match Your Records with Bank and Credit Card Statements:

 Cross-reference your Profit & Loss statement and Balance Sheet with your ending bank and credit card balances to identify any discrepancies or missing transactions. This helps confirm that all income and expenses are properly recorded, reduces the risk of errors in your tax filings, and ensures that your financial statements reflect the true state of your business. 

 

Verify Your Revenue: 

Verify that your revenue matches your 1099-K forms to ensure that the income reported to the IRS aligns with your records. If your revenue comes from multiple sources, such as different payment processors or sales channels, gather and verify documentation that confirms these figures. 

 

Include any Crypto or Investment Accounts: 

Include cryptocurrency holdings or investment accounts in your financial records, as these assets can significantly impact your tax liability. Accurate reporting of cryptocurrencies and investments ensures proper accounting for gains or losses, affecting your overall tax bill..

 

Consult with a tax professional: 

Seek expert guidance from a tax professional to navigate complex tax laws, maximize deductions, and ensure compliance with all regulations. A tax professional can identify potential tax-saving opportunities specific to your business and address any unique challenges you might face. Additionally, our comprehensive bookkeeping and accounting services ensure your financial records are accurate and up-to-date so you can focus on growing your business.

 At xendoo, we understand small business owners’ challenges in managing their finances. With the choice of two cloud-based general ledger software, Xero or Quickbooks Online, our comprehensive bookkeeping, catch-up, tax, and CFO services are designed to help you stay on top of your financial health. This allows you to focus on what you do best—running your business. Schedule a free consultation today to learn how we can support your company’s financial success.

 

Turning Election Uncertainty into Opportunity

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As the election cycle approaches, small business owners must take proactive steps to ensure their businesses remain resilient regardless of the outcome. While the election period can bring uncertainty, strategic planning and sound financial management can help you navigate it successfully. Here’s how small businesses can prepare for the upcoming election and thrive no matter which party comes into office.

Forecast Your Financials

One of the most critical steps small business owners should take is forecasting their financials. Understanding your cash flow and ensuring a solid financial plan can help weather any changes that might come with a new administration.

  • Project Future Cash Flow: Create detailed cash flow projections for 6-12 months. Consider different scenarios, such as changes in sales, expenses, and market conditions. Use historical data and market research to predict potential fluctuations in revenue and costs. For instance, an auto repair shop might project cash flow under scenarios where fuel prices fluctuate due to policy changes. Higher fuel prices mean a demand for maintenance services as consumers look to improve fuel efficiency. Regularly update these projections to reflect the latest economic indicators and policy developments.
  • Adjust Budgets: Based on your projections, adjust your budgets to ensure you have sufficient reserves. A small manufacturing business might postpone expanding its production line or invest in new technology. By deferring significant expenditures, you can conserve cash and maintain flexibility to adapt to post-election economic conditions. Additionally, look at your optional spending and find ways to save money. This could mean getting better deals with your suppliers or cutting unnecessary costs. Doing this will strengthen your business financially, ready to take advantage of new opportunities or handle any problems after the election.

Manage Supply Chains

 Identifying potential vulnerabilities in your supply chain is crucial for maintaining business continuity, especially during political uncertainty.

  • Assess Supplier Risks: Begin by evaluating your current suppliers’ reliability. Assess factors such as their financial stability, the consistency of their delivery times, and their ability to meet your quality standards. It is also important to communicate regularly with your suppliers to stay updated on any changes that might affect your supply chain.
  • Diversify Supplier Base: To reduce risk, consider diversifying your supplier base. Instead of relying on a single supplier, develop relationships with multiple suppliers, ideally located in different regions. This strategy can help you mitigate risks associated with tariffs, trade restrictions, or geopolitical issues. For example, a small electronics manufacturer might source components from Asian and European suppliers. If political tensions or new trade policies disrupt supply from one region, they can still receive components from another, ensuring production continues without significant delays.

Focus on Internal Operations

Use the election cycle as an inflection point to refine your internal operations. This period can be an excellent opportunity to get your business in the best possible shape.

  • Invest in innovative technologies: Improving operational efficiency is key to maximizing productivity and reducing costs in your business. For instance, a small café can significantly enhance efficiency by investing in a point-of-sale (POS) system that integrates inventory management. This technology simplifies transactions and tracks inventory levels in real-time. Moreover, automating routine tasks like order processing and inventory tracking frees staff to focus on customer service and business growth initiatives.
  • Update Your Books: Knowing your numbers is crucial for understanding your business’s finances and making smart decisions. Accurate records help you track cash flow, manage expenses, and see how profitable you are. Partner with an expert online accounting firm like xendoo to help you stay ahead of the curve and adapt to changes. xendoo will handle all your bookkeeping and tax needs so you can focus on growing your business during uncertain times. 

 

Use this election cycle as an opportunity to strengthen your business. Just like preparing for any significant event, having your books in order and your taxes paid will position your business for success. With careful planning and a proactive approach, your business can navigate the election cycle and emerge stronger on the other side. Preparing and focusing on financial health will ensure your business thrives regardless of the election outcome. 

Schedule a free consultation to learn more about how xendoo can free up your time to focus on growing your business by taking bookkeeping, accounting, and tax off your plate. 

 

Thriving Through The Tech Waves: Small Business Transformation

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Technological advancements have continuously reshaped the business landscape, pushing industries into new realms of efficiency and innovation. Understanding these waves—each marked by distinct technological breakthroughs—is crucial for small businesses aiming to thrive in today’s digital era.

The Four Waves of Technological Change and Their Impact on Businesses

The First Wave: The Industrial Revolution

The first wave, marked by the Industrial Revolution, introduced machines and steam power, where businesses began using assembly lines, allowing them to produce large quantities of goods quickly and cheaply.

The Second Wave: The Electrical Revolution

The second wave brought widespread use of electricity and mass production techniques. Businesses grew with better operational capabilities and reached more customers.

The Third Wave: The Digital Revolution

The third wave saw the rise of automation, computers, and the internet, which changed how businesses interacted with customers and managed operations on a global scale.

The Fourth Wave: Embracing Connectivity and Mobile Dominance

Today, we are in the fourth wave, which combines the internet, wireless connectivity, and powerful mobile devices. This wave allows businesses to connect, use data, and operate more efficiently.

Harnessing the Power of the 4th Wave

The 4th wave of technology has transformed businesses by enhancing connectivity and mobile capabilities like never before. Businesses can manage inventory, analyze customer data, and conduct sales through AI and advanced digital tools like wireless technology. These capabilities empower businesses to operate more efficiently and make informed decisions swiftly. Additionally, these tasks can be seamlessly performed using smartphones or tablets, reflecting the integration of mobile technology into everyday business operations. This connectivity helps businesses stay agile, respond quickly to customer needs, and make informed decisions instantly. It’s crucial for businesses to keep up with this digital shift to stay competitive. Falling behind could mean losing market share and missing growth opportunities.

Here’s how various industries are embracing these 4th wave advancements:

Hospitality Industry: Enhancing Efficiency with Wireless Solutions

Restaurant owners now utilize wireless payment devices like Toast, a leading point-of-sale system used to expedite transactions, gather real-time data on sales trends and peak hours, and take orders. Wireless technology, like this one, has drastically improved customer experience because it reduces the time it takes to pay the bill, accelerates the dining process, and minimizes miscommunication or errors that can occur with handwritten order notes. This improves customer satisfaction and benefits the restaurant by increasing table turnover rates and enabling strategic menu offerings and staffing decisions.

Marketing Agencies: AI-Powered Creativity and Efficiency

Marketing firms harness artificial intelligence to automate repetitive tasks and enhance creative outputs. AI tools like ChatGPT swiftly analyze market trends, customer sentiments, and campaign performance, enabling quick decision-making and optimization. AI can generate stock images, analyze reports, and write social copy. These tools make agencies more effective, helping them deliver targeted marketing that connects well with their clients’ audiences. It keeps agencies competitive and helps them grow by delivering better client results. It also frees up valuable time for marketing professionals to focus on strategic initiatives and creative endeavors. 

Retail Industry: Data-Driven Insights for Competitive Edge

Retailers are increasingly adopting an omnichannel approach, allowing customers to shop seamlessly across various platforms, including in-store, online, and via mobile apps. The ability to shop from home and on your smartphone has transformed the retail experience, offering convenience and flexibility to consumers. This shift is crucial because it meets customers’ growing expectations for accessible and immediate shopping experiences. Retailers embracing digital transformation can provide personalized experiences, track customer behaviors across channels, and optimize inventory management and marketing strategies accordingly. For example, a retailer can analyze how many customers click on their online ads and make purchases immediately, allowing them to measure the effectiveness of their marketing efforts in real time. By integrating digital tools, retailers not only enhance customer satisfaction but also gain valuable insights into purchasing patterns and trends, enabling them to stay competitive in a dynamic market landscape.

Financial Management for Businesses:

Cloud-based accounting software has emerged as a transformative tool for businesses seeking efficient financial management solutions. Unlike traditional methods, cloud accounting offers real-time data access, collaboration capabilities, and enhanced security—all accessible from any device with internet connectivity. This technology streamlines processes like invoicing, expense tracking, and financial reporting, empowering businesses to make informed decisions swiftly. As businesses pivot towards digital transformation, adopting cloud-based financial management systems represents the future of efficiency and streamlined operations.

As small businesses navigate the rapid currents of technological evolution, embracing digital transformation becomes not just a choice but a necessity for staying competitive in today’s market. To thrive through these tech waves, businesses must take proactive steps towards digital transformation. 

Implementing innovative technologies such as cloud-based financial management systems will provide your business with a significant competitive advantage. At xendoo, we understand small business owners’ challenges in managing their finances. With the choice of two cloud-based general ledger software, Xero or Quickbooks Online, our comprehensive bookkeeping, catch-up, tax, and CFO services are designed to help you stay on top of your financial health. This allows you to focus on what you do best—running your business. Schedule a free consultation today to learn how we can support your company’s financial success.

 

Unlocking Business Potential: The Power of KPIs for Small and Medium Enterprise

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The Value of KPIs for Small Businesses

In the business landscape, It may be difficult to succeed in the ever-changing business world, particularly for small and medium-sized enterprises (SMEs). A well-defined strategy is crucial for these small enterprises, the backbone of our economy. However, these smaller companies often face significant challenges on the road to success due to limited resources and constant performance pressure. In this situation, Key Performance Indicators (KPIs) become indispensable tools, offering essential guidance amidst the daily hustle.

We know the difficulties SMEs encounter and the crucial role of KPIs in their success. Imagine that KPIs are the compass directing your ship as it navigates unknown seas. This is your company. They help you overcome obstacles and seize opportunities by giving you direction, clarity, and a feeling of purpose. This article provides an in-depth discussion of the importance of KPIs for small business owners and provides methods for effectively utilizing their power. So buckle up and prepare to go off on a business success adventure with xendoo.com as your reliable guide..

Defining KPIs and Their Role in Business Strategy

Key Performance Indicators (KPIs) are fundamental measures that show what makes an enterprise successful. These quantifiable metrics show how well an enterprise is accomplishing its main goals. KPIs translate strategic vision into practical, implementable components, serving as a link between ambition and performance.

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Core Features of Effective KPIs:

  1. Quantifiable and Value-Based: Businesses may objectively assess progress thanks to the quantifiability of effective KPIs. They are founded on value, which means they are closely related to the factors crucial to the company’s success.
  1. Measure Overall Strategic Objectives Rather Than Individual Employee Performance: KPIs emphasize broad strategic objectives more than individual employees’ performance. This ensures that the organization as a whole follows the strategic direction.
  1. Compare Performance against Predefined Benchmarks (RAG System): To rapidly detect off-target regions, KPIs are checked against benchmarks, often utilizing the Red, Amber, and Green (RAG) status system.
  1. Adhere to the SMART criteria, which state that KPIs should be Time-bound, with a defined timetable; Specific, specifying what is monitored; Measurable, measuring progress quantitatively; Achievable, being practical and achievable; and Relevant, connecting with strategic goals.
  1. Incorporate Both Leading and Lagging Indicators: A well-rounded strategy incorporates both lagging indicators, which assess the results of previous activities, and leading indicators, which forecast success in the future.

The Importance of Aligning KPIs with Business Strategy:

It is critical to align KPIs with company strategy. It guarantees that the monitored measurements are more than figures; they are signs guiding the company toward its strategic objectives. A culture of continuous improvement and strategic success is fostered when KPIs align with the company plan and offer operational activities and decision-making in a defined direction. This alignment is particularly important for small organizations where strategic resource allocation may substantially influence growth and profitability.

Why Small Businesses Should Implement KPIs

KPIs have several strategic advantages. They gauge the effectiveness of your company plan, showing you exactly where you are and where you need to go.

They enable stakeholders to unite behind common objectives by fostering a culture of accountability and openness. Additionally, KPIs provide a solid basis for sound financial planning and decision-making, enabling small company owners to manage resources purposefully and precisely. When a clear KPI framework is in place, individual performance aligns with the organization’s strategic objectives, helping employees understand how their efforts impact the company’s overall performance. This alignment fosters a sense of responsibility and ownership among team members. This alignment is especially advantageous for small organizations when each team member’s contribution is crucial to the overall success.

Choosing the Right Mix of KPIs

For KPIs, the maxim “less is more” is applicable, particularly for small enterprises. According to the “7 plus or minus 2” rule, people can only efficiently retain 5 to 9 pieces of knowledge simultaneously. Starting with five KPIs is a reasonable and practical way for small firms to concentrate on the most important performance metrics and prevent information overload.

Proper Combination of Trailing and Leading KPIs

  1. Headline KPIs: These are predictive indicators that look forward and aid in projecting future performance. These are preemptive actions that identify possible trends before they materialize completely. Examples include the quantity of new leads or customer satisfaction ratings.
  1. Lagging Key Performance Indicators (KPIs): These indicators look backward and show results that have already happened. They are responses that validate long-term patterns once they have emerged. Net profit or sales increase are two examples.

Adapting KPIs to Corporate Objectives:

To guarantee KPIs work, you must customize them to your company’s unique objectives and requirements. KPIs must be closely related to strategic goals and represent the particulars of your company’s activities and sector. With this modification, you can be confident that the KPIs you monitor are useful and applicable, directing your company toward its strategic goals.

Top 15 KPIs for Small Businesses

Choosing the appropriate Key Performance Indicators (KPIs) is essential for small firms as it allows them to track their development and make strategic choices. This is a thorough list of KPIs that small firms may use to monitor their performance efficiently:

  1. Net Profit is the real profit made by the company, calculated as total revenue minus total costs. It is an unmistakable sign of the business’s prosperity.
  1. Net Profit Margin: This KPI displays the revenue left over as profit after paying all costs. It aids companies in comprehending their sales profit margin.
  1. Gross Profit Margin: This is calculated by dividing the revenue by the product cost. It shows how well goods are produced and services are provided.
  1. Quick Ratio: Also referred to as the acid-test ratio, this ratio assesses a company’s capacity to pay short-term debts using its most liquid assets. It’s a reliable gauge of financial well-being.
  1. Customer Acquisition Costs: This indicator determines the cost of bringing on a new client, including sales and marketing expenditures. It is essential to comprehend the worth of client acquisition initiatives.
  1. Monthly Recurring Revenue is the steady income a company receives each month. It is crucial for companies that use subscription models.
  1. Customer Satisfaction: This KPI gauges how happy consumers are with a company’s goods or services and is often assessed via surveys. Positive feedback might result in recommendations and repeat business.
  1. Website Traffic/Interaction: This gauges how many people visit and engage with a business’s website. It’s critical for assessing one’s online presence and the success of digital marketing tactics.
  1. Social Media Engagement: This measures how often a company’s social media material is liked, shared, and commented on. It displays audience involvement and brand awareness.
  1. Total Customers: This Key Performance Indicator determines a firm’s clients. It’s a simple indicator of company expansion and market penetration.
  1. Net Promoter Score: This metric gauges client loyalty and the chance patrons will tell others about a company. A high rating indicates a solid rapport with customers.
  1. Customer Complaints: Businesses may improve their goods and services and raise customer satisfaction by keeping track of the quantity and kind of complaints.
  1. Employee Satisfaction: Contented workers are often more dedicated and productive. This KPI is related to employee engagement and business culture and may be monitored using surveys.
  1. Employee Retention Rate: This gauges how well a company can retain its staff over time. A high retention rate may signify efficient management and a happy workplace.
  1. Energy Consumption: This KPI tracks how much energy companies prioritize sustainability utilize. It is crucial for controlling expenses and the environment’s effect.

Building an Effective KPI Monitoring Process

Small and medium firms must develop a structured method for monitoring and reporting key performance indicators (KPIs) to fully utilize them. This method ensures that KPIs are not only gathered but also actively used to drive company improvements and guide strategic choices.

The Significance of an Official KPI Procedure:

Performance measurement gains consistency and discipline when KPIs are monitored according to a structured procedure. It guarantees that information is gathered methodically, correctly processed, and published on schedule. This regularity is necessary to make choices based on up-to-date company performance data and monitor progress toward strategic objectives.

Utilizing Software Programs to Manage KPIs:

Software solutions are essential for automating KPIs’ monitoring, reporting, and administration in the current digital era. These technologies may greatly reduce the human labor required for data gathering and analysis, freeing up small company owners to concentrate on analyzing the information and formulating strategic plans. Software solutions may provide real-time company performance overviews via dashboards, which make it simpler to identify patterns and take quick action on problems..

xendoo.com provides solutions that easily connect with corporate processes and recognize the value of an efficient KPI monitoring process. With the help of xendoo’s experience, small companies may create a KPI framework that records the appropriate indicators and offers the insights required to guide the company toward its strategic goals. With accounting services that monitor financial KPIs and tax services that maximize fiscal performance, for example, xendoo.com is prepared to assist small companies in developing a strong KPI monitoring system.

Conclusion: Getting Started with KPIs

As we have shown, Key Performance Indicators (KPIs) should be included in strategic planning for small organizations. It is imperative. KPIs provide the useful information and insights required to negotiate the intricacies of the modern corporate environment. They serve as the road signs that direct small enterprises to their intended strategic locations and guarantee that every endeavor advances the overall objectives.

Small firms must prioritize ongoing monitoring and improvement of KPIs to fully utilize their potential. Since the dynamic business environment, success metrics should also be subject to constant change. By being reviewed and adjusted on a regular basis, KPIs may stay relevant and in line with current company goals and market circumstances.

Completing these preliminary actions may help small firms lay the groundwork for a strong KPI system that supports strategic development and well-informed decision-making. xendoo.com is here to help you by providing the resources and know-how required to transform data into tactical action. Begin your KPI journey right now to realize your company’s full potential.

Key Performance Indicators (KPIs) are your road markers to success. However, comprehending and implementing KPIs may be challenging, requiring knowledge, accuracy, and skill. Here’s where xendoo.com, your reliable partner, comes in. We warmly encourage small and medium businesses to contact our team of professionals for tailored guidance that aligns with their particular business requirements.

Establishing a good KPI framework is a goal that may be accomplished with professional help. With their extensive backgrounds in accounting, taxation, and CFO services, our experts at xendoo.com guarantee that your KPIs are not only pertinent but also completely included in your overall financial plan. Start along the path to strategic excellence. 

5 Reasons Catch-Up Bookkeeping Can Propel Your Start-up or Small Business

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Managing finances can make a big difference in the success of start-ups and small businesses. Maintaining updated and accurate financial records is crucial for many financial management functions. Catch-up bookkeeping is a method for bringing your financial records up to date when they have become outdated. This catch-up bookkeeping is crucial for small business owners, especially those in the early stages, as it helps them achieve financial clarity, maximize tax deductions, and enhance financial management. This is where xendoo.com is helpful, as it provides a wide range of services curated according to the needs of small- to medium-sized enterprises. This article will highlight the five essential reasons why catch-up bookkeeping can drive a start-up or small business forward, allowing the owners to make informed decisions for long-term success.

1. Gain Financial Clarity

Importance of Clear Financial Records
Clear financial records form the foundation of effective management, especially for start-ups and small businesses. By bringing your books up to date, you gain a clear picture of your business’s financial health, allowing you to make informed decisions about the future.

Visibility into Income, Expenses, and Cash Flow
Catch-up bookkeeping provides comprehensive visibility into your financial situation, including revenue sources, operational costs, and cash flow. This helps you maintain sufficient working capital and plan for future expenses.

Benefits of Informed Decision-Making
Accurate financial records are critical for making strategic decisions. With detailed insights into your income, expenses, and cash flow, you can identify areas to reduce costs, allocate resources more efficiently, and spot new opportunities. xendoo.com supports you by ensuring your finances are current and organized.

Maximize Tax Deductions

Challenges of Tax Season for Entrepreneurs

Tax season is often a stressful time for business owners. Small businesses, especially those without a dedicated accounting team, struggle to track eligible deductions and rapid changes in tax laws add another layer of complexity.

How Catch-Up Bookkeeping Helps Capture All Eligible Expenses and Deductions

Catch-up bookkeeping meticulously tracks eligible expenses, maximizing deductions and reducing tax liabilities. xendoo.com’s expert accountants ensure your records are accurate, compliant, and up-to-date, helping you capture all potential deductions.

Potential Cost Savings and Advantages of Organized Records During Tax Preparation

The tax benefits of using catch-up bookkeeping are an important factor to help save money when preparing returns. Simultaneously, by maintaining an orderly record of all the financial activity the business is involved in, business owners will benefit financially by saving time and money when submitting their annual taxes. These can enable them to provide accurate and detailed records to their tax preparer that can prevent errors if they are not claiming deserving deductions and credits. Accurate and organized record-keeping allows tax preparers to spot tax-saving opportunities, deferring some income and accelerating spending, potentially leading to great tax savings.

Spot Financial Trends

Value of Analyzing Historical Financial Data

Analyzing historical data reveals valuable trends that can guide your business decisions. Reviewing revenue, costs, and net profit patterns over time can uncover strengths, weaknesses, and growth opportunities, helping refine your business strategy.

How Catch-Up Bookkeeping Enables Businesses to Identify Trends and Patterns

Catch-up bookkeeping is the basis for examining the data to determine current and future trends and patterns. This can be done by upgrading financial documents, spotting the development of the business’s financial performance, and detecting periodic patterns and trends. For example, a drop in sales during winter or marketing activities triggers an increase in sales. This level of data allows organizations much-needed insight into making strategic decisions, such as targeting marketing or tapping into a new market to ride on trends and boost revenue.

Examples of Strategic Decision-Making Based on Financial Insights

Another way that financial intelligence impacts these tactical decisions is by tailoring price strategies according to consumer buying behaviors. Collecting past sales data can help one learn that some products are often consumed more at a particular time of the year or that customers are ready to pay a higher price only for a specific selection. Using the information obtained, small business owners will be able to invent a pricing strategy, which will allow them to increase their earnings.

Another example is identifying cost-saving opportunities based on the data collected from historical expenses. By analyzing past expenses, a business can locate where cost reductions are possible, such as canceling some contracts with suppliers or simplifying internal processes. These instances illustrate that analyzing historical financial data helps businesses make well-informed strategic decisions, boosting their efficiency and growth.

Enhance Investor Confidence

Importance of Transparent Financial Records for Attracting Investors

Transparency accounting is very important in attracting investors as it gives a clear picture of the business’s financial health and performance, which comes in handy in informing decisions about injections. The investors use financial reports to consult about the possibility of investing in the business. Also, these reports serve as a means of assessing the risks and return on investment that would come their way. The accounting records convince investors that the business is good in finance, stable, and sustainable enough to make a profit for them, which is good evidence of effective management.

How Catch-Up Bookkeeping Demonstrates Commitment to Financial Integrity

Catch-up bookkeeping is proof of financial integrity because it ends the gaps between the books, provides the most accurate and up-to-date records, and complies with accounting standards and regulations. As a result, it indicates that you perform these duties responsibly and strive to provide them with faultless and notable financial information. This attitude of having confidence in your financial values will build trust among investors, and they will be certain that you meet their investment goals.

Benefits of Organized Financial Statements in Investor Relations

Properly prepared financial statements are a major stakeholder relationship enhancer, showing investors the cleaned and arranged version of your company’s financial performance. Structured financial statements make understanding your business’s investment prospects fairly simple. Investors can easily find out how your business is performing, identify trends and patterns, and make informed investment decisions as you always remain transparent. Another benefit is that you can create the statements of financial statements to communicate the results of financial performance to potential investors in the most efficient way, which leads to improved relationships and trust in your business.

Ensure Compliance and Avoid Penalties

Risks of Non-Compliance with Regulations and Tax Laws

Violation of regulations and tax laws can lead to punitive measures in the form of fines, lawsuits, and permanent harm to reputation. Regulatory agencies and tax authorities expect businesses to follow their laws, including those related, for instance, to financial reporting, taxation, and employment. Compliance with these laws may lead to penalties, sanctions, and business closure. Through catch-up bookkeeping service, xendoo.com maintains your business on the right side of the law, making sure your business is compliant and safe from avoidable risk.

How Catch-Up Bookkeeping Helps Businesses Stay on the Right Side of the Law

Financial management must be done proactively to reduce the risks of non-compliance. By adopting a proactive approach to financial management, businesses may recognize compliance problems and remediate them promptly, such as adopting internal controls, performing regular audits, and being updated about the modifications in regulations and tax laws. Proactive financial management also includes the creation of a culture of compliance within the organization where employees know their responsibilities and are dedicated to following the laws.

 

Catch-up bookkeeping has a couple of extremely vital provisions for start-ups and small businesses: financial clarity and understanding through knowledge, maximizing deductibility of tax, detecting patterns, and developing the investors’ confidence. Implementing organized financial records will be as significant as making it possible for people to be well-informed about their business at any level. Asking for professional help is not a sign of weakness; instead, it will assist in understanding financial complexities and preparing your enterprise for business. Create the habit, starting today, and you will be able to manage the flow of cash transactions in your business while striving to accomplish your goals.

About xendoo

We share your passion for small businesses and are inspired by your dedication to making your dreams a reality. Your dedication to making your dreams a reality inspires us. That’s why we’re committed to providing you with the financial visibility and support you need to thrive.

More Than Just Numbers

It’s more than simply crunching numbers. It’s about building meaningful relationships with our clients and understanding their needs. Our people-first mentality ensures you receive personalized attention and expert guidance throughout your financial journey.

A One-Stop Solution

xendoo offers a comprehensive suite of services, including:

  • Full-service bookkeeping and accounting team to free up your time and resources.
  • Hassle-free tax preparation and filing
  • Fractional CFO Services to work with you on a roadmap of future growth
  • A dashboard that provides real-time financial insights

Passionate about your success? xendoo is, too. We provide the financial visibility and support small businesses need to thrive and scale. Let us handle the financial burden so you can focus on what matters most – running your business and achieving your goals.

Contact xendoo today and discover how we can give you time back to grow your business.

Financial Forecasting for Small Businesses: Gaining Control of Your Future

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In today’s business landscape, small business owners face the challenge of navigating through financial uncertainties to secure a prosperous future for their enterprises. At the heart of this challenge lies the need for adequate financial forecasting. This tool goes beyond mere prediction as a strategic compass guiding businesses toward stability and growth. Recognizing this, xendoo strives to be an ally for small businesses, offering a comprehensive suite of financial tools and services designed to empower entrepreneurs. From advanced cloud-based accounting software and AI-driven analytics to personalized financial advisory services, xendoo equips small business owners with the resources to create precise financial forecasts, manage cash flow efficiently, and make informed decisions.

Moreover, for small business management, gaining control of their financial future is necessary and an added advantage. Amid this crucial requirement, financial forecasting emerges as a beacon of guidance, empowering businesses to navigate uncertainty confidently. This is where the role of Fractional CFOs and comprehensive financial services like xendoo become pivotal. This blog sets the stage for an in-depth exploration of how xendoo’s solutions and expert guidance transform the financial forecasting landscape, enabling small businesses to envision and actively shape their financial future.

Cloud-Based Accounting Software:

Cloud-based accounting software, prominently featured in xendoo’s suite of financial tools, revolutionizes how small businesses approach their finances. Platforms like QuickBooks Xero offer more than convenience; they provide a foundation for transformative financial management. By enabling real-time tracking and analysis, these software solutions ensure that businesses can keep a constant pulse on their financial health. Integrating expense tracking, invoicing, and detailed financial reporting streamlines the complex financial forecasting process. This not only demystifies the gathering and analysis of critical financial data but also enhances the accuracy and reliability of forecasts. For small businesses, this means the ability to anticipate financial challenges and opportunities with a new level of precision. By leveraging cloud-based accounting software, businesses can make informed decisions, plan strategically for the future, and maintain a competitive edge in their respective markets, all through the power of efficient and accessible financial management tools provided by xendoo.

AI and Machine Learning Tools:

Integrating Artificial Intelligence (AI) and Machine Learning (ML) in financial forecasting represents a revolutionary leap forward. xendoo harnesses these advanced technologies to offer small businesses a competitive edge in financial management. Our AI and ML algorithms are designed to delve deep into extensive datasets, extracting patterns and trends that might elude traditional analysis. This capability enables the prediction of future financial outcomes with high precision and furnishes businesses with actionable insights to guide strategic decision-making. Automating forecasting processes through these intelligent tools reduces the potential for human error, ensuring that the forecasts are reliable and robust. By embracing AI and ML, xendoo elevates financial forecasting from a necessary chore to a strategic asset, empowering businesses to anticipate challenges, seize opportunities, and confidently navigate the future, thus markedly enhancing their forecasting accuracy and overall financial strategy.

Financial Dashboards and Analytics Platforms:

Consequently, xendoo’s financial dashboards and analytics platforms are pivotal tools for small businesses, providing a consolidated view of financial data and valuable insights into financial health and forecasting metrics. By offering a comprehensive visualization of their financial data, our service enables small business owners to understand their current financial position and forecast future trends. This comprehensive view empowers proactive and strategic decision-making, allowing businesses to make informed choices to drive growth and success. With xendoo’s dashboards, small business owners can efficiently monitor critical financial indicators, identify patterns, and anticipate future challenges and opportunities. Visualizing financial data in a single view enhances transparency, fosters better financial management, and equips businesses with the knowledge to navigate their financial landscape confidently and strategically.

Cash Flow Management Tools:

xendoo recognizes that managing cash flow is crucial for the sustainability of small businesses. Our platform offers invaluable insights into cash flow patterns, empowering businesses to effectively manage their liquidity and prevent cash shortages. Through our cash flow management tools, entrepreneurs can understand their cash flow dynamics comprehensively, enabling them to maintain a healthy financial position and allocate resources optimally. By monitoring cash inflows and outflows, businesses can make informed decisions regarding expenditures, investments, and operational strategies. This proactive approach safeguards against liquidity challenges and facilitates the prudent allocation of funds toward growth initiatives. Ultimately, xendoo’s cash flow management tools provide small businesses with the insight and control necessary to navigate their financial landscape confidently and financially.

Online Financial Advisory Services:

xendoo’s commitment to facilitating the success of small businesses extends beyond providing software solutions. While fintech companies and online platforms offer personalized financial advice, xendoo offers a comprehensive package with access to financial experts and cutting-edge software solutions. This unique integration enables small businesses to benefit from expert financial forecasting and risk management guidance while leveraging the latest financial technology. By combining the insights and expertise of financial experts with advanced software, xendoo empowers businesses to make informed, strategic decisions while securing their financial future. This approach provides small businesses the resources and support to navigate complex financial landscapes confidently, ensuring sustainable growth and success.

In conclusion, small business owners face the crucial challenge of navigating financial uncertainties to secure a prosperous future in the competitive business world. Particularly in this context, the role of Fractional CFOs and comprehensive financial services like xendoo becomes pivotal. xendoo’s suite of financial tools and services, which includes cloud-based accounting software, AI and machine learning tools, financial dashboards, cash flow management tools, and online financial advisory services, equips small business owners with the resources they need to create precise financial forecasts, manage cash flow efficiently, and make informed decisions. xendoo’s innovative solutions and expert guidance transform the financial forecasting landscape, enabling small businesses to envision and actively shape their financial future. By providing businesses with robust and reliable financial management tools, xendoo empowers them to make informed decisions, strategically plan for the future, and maintain a competitive edge in the market. Through advanced technology and expert support, xendoo ensures sustainable growth and success for small businesses. Visit xendoo.com today to explore how our tailored financial solutions can unlock the full potential of financial forecasting for your small business, guiding you toward a successful journey.

Managing Financial Risk in Small Business

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As a small business owner, understanding that financial risk management is essential to ensure the long-term success and sustainability of the business well into the future is paramount. By understanding and actively mitigating financial risks, businesses can safeguard their assets, maintain stability during economic fluctuations, and seize growth opportunities. Examples of financial risks, such as economic downturns and unexpected customer behaviors, among many others, can be most detrimental to the operation of a small business if not managed accordingly. Other necessities of financial risk management for a small business include its broader view concerning the potential dangers it may face in operation, particularly the threat of economic uncertainty, market volatility, natural disasters, operational risks, and unpredicted changes in customer demand.

Business Risk Assessment

Building a successful small business requires strategic foresight and the ability to mitigate potential threats. This is where business risk assessment becomes crucial. It’s a comprehensive process that identifies, analyzes, and evaluates potential risks that could impact your financial stability and operational continuity.

This assessment goes beyond generic factors, delving into market trends, economic indicators, operational vulnerabilities, and external threats. By integrating this process into your financial risk management strategy, you gain valuable insights into the broader business environment and, more importantly, the unique risks specific to your company.

This proactive approach empowers you to fortify your business against the inherent uncertainties of the market. It’s the foundation for cultivating a robust risk management culture, leading to long-term stability and growth.

You can minimize potential financial disruptions by leveraging sound risk assessment principles and implementing effective risk management strategies. This allows you to navigate a dynamic business landscape confidently, build financial resilience, and achieve sustainable growth.

In essence, a proactive business risk assessment empowers you to take control of your future and steer your small business toward long-term success.

Small Business Risk Strategies

1. Diversification of Revenue Streams

Diversification of the revenue stream is one critical strategy a small business should pursue in financial risk management. Depending on one product or service is a great risk, as it may expose the business to great risks, market fluctuations, or changes in consumer demand. This could be further expanded by offering another or a new segment of customers. Business risk assessment and business risk strategies in place should include revenue diversification. This will go a long way to ensure these small enterprises enjoy financial stability and continuity.

2. Building Emergency Funds and Contingency Plans

Small business owners seeking to better their financial risk management would do well in that area to reach emergency funds and contingency plans. Reserving money to get through unexpected financial challenges while trying to hedge off the possibilities of incidents ranging from economic downturns to natural disasters is part and parcel of such a process. Consequently, having a clear contingency in place enables businesses to respond in the best and quickest way to minimize potential financial risks better. would be necessary to make a strong assessment of business risks and make strategies for small business risks, like making an emergency fund and making the contingency plan compulsory for small enterprises to strengthen their financial stability. By doing this, the small business owner would be better prepared for different financial risk possibilities and have a better resistance level in the changing business environment.

3. Strategic Financial Planning and Forecasting

Small businesses need to be strategic about their financial planning and forecasting. Proper planning and forecasting of small businesses can get huge benefits since this allows owners to project future cash flow and simultaneously make proactive decisions in managing financial challenges within robust business risk assessment and small business risk strategies. Moreover, effective financial planning will allow the business to allocate resources wisely, creating an approach toward prioritizing practical risk management initiatives. When these risk management small business strategies are integrated with the main financial planning process, the business may build more resiliency to deal with uncertainties more effectively and strategically. This will enable small businesses to lay a good foundation to strengthen their financial stability and develop their long-term success amidst the cutthroat business competition, thus emphasizing the needs of financial planning and forecasting for small business risk management.

4. Insurance and Risk Transfer

The other aspect of financial risk management for small businesses is suitable coverage through insurance. From the various types of property insurance to different liability covers and business interruption insurance, the purchase of appropriate types of insurance can be a major strategy for risk management. Small businesses can thus manage well by covering possible financial burdens through insurance they possess, per the identified risk profiles in business risk assessments and small business risk strategies. This will enable small business owners to strengthen their enterprises against unforeseen financial adversities through insurance and transfer incorporated as a tool for risk management strategies. Proactive management of potential risks in business with comprehensive insurance demonstrates how to apply the principles of financial risk management in reality—bringing back to life the potentialities of small businesses amid many uncertainties prevailing in the business environment.

Conclusion

Effective financial risk management for small businesses is an all-inclusive effort of business risk assessment that merges tailor-made risk management strategies. In their quest for long-term success, which significantly hinges on effective financial risk management, small business owners are bound to adapt to numerous potential threats by being proactive. By conducting effective business risk assessments, small enterprises can gain valuable insights and develop targeted risk management strategies that help strengthen the enterprise against uncertainties through resilience.

How to Outsource Bookkeeping – A Guide

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A man in an oxford shirt looks at his bookkeeping on his laptop

Since starting your business, you’ve likely filled multiple roles–from product and customer service to bookkeeping and sales–at some point. However, as your business has grown, you may have felt like you don’t want to spend your time doing some of those tasks. 

For instance, you’ve probably asked yourself: Should I outsource bookkeeping?

Whether or not to outsource is a common question many small business owners face. Tasks like bookkeeping are ideal to hire outside help. Others like sales may be better to manage in-house. There are a few ways that you can hire a bookkeeper. Primarily, businesses choose virtual bookkeepers or local bookkeepers.

In this guide, we’ll dive into everything related to outsourced bookkeeping from what it costs to how to outsource it. You can click to go to a particular section below or scroll down to start from the top. 

When should I outsource my bookkeeping?

If your business is new and you don’t have significant revenue or budget to hire outside help, you’ll probably try DIY bookkeeping first.

However, most businesses prefer to outsource their bookkeeping, especially as they grow. These are some of the top signs that it is time to outsource your bookkeeping:

  • You’re spending several hours each week doing accounting and bookkeeping tasks yourself.
  • You plan to get funding through investors or business loans and need accurate financial statements.
  • Your books are behind, and you need to catch up.
  • You’re spending a lot of money hiring full-time, in-house bookkeepers or a local bookkeeper.
  • You aren’t sure about your current cash flow or financial health.
  • Tax season is coming up, and you don’t feel prepared to file your taxes.
  • You simply have no desire to learn bookkeeping or to do it yourself.

Why should I outsource my bookkeeping?

At first, you might be hesitant to trust an outside bookkeeper with your financial data. There are so many benefits to outsourcing your bookkeeping, as long as you choose a trustworthy CPA or bookkeeper. The top benefits of outsourcing your bookkeeping include:

Up-to-date books and more time for business

Small business owners are notorious for spending a large amount of time on administrative work, like employee scheduling, preparing payroll, and bookkeeping. It is estimated that small business owners spend 120 working days per year on administrative tasks like bookkeeping. Still, nearly 25% of businesses are behind on their books. 

Hiring a bookkeeper allows you to free up more time. With the time saved, you can focus on the tasks that excite you most as a business owner. Although bookkeeping it’s extremely important to the health and success of a business, it is not necessarily a task that most entrepreneurs enjoy doing.

Cost-effective bookkeeping

If you’ve attempted to do small business bookkeeping on your own, you already know that it can take a lot of time and money. Even if you utilize programs like Quickbooks or Xero, you can’t automate all your bookkeeping needs.

If you’ve hired an hourly bookkeeper or accountant, the cost per hour adds up fast. xendoo offers pricing plans with a flat-rate monthly fee, so you can easily budget for your bookkeeping each month.

Business loan and funding preparation

As your business grows, your bookkeeping and accounting needs grow too. If you want to take out a loan or open a line of credit, your lender will want accurate financial statements. It can take hours to do this on your own, and it might not be accurate.

Bookkeepers have experience doing this for multiple clients, so they can put financial statements together quickly in a way that’s presentable for your potential lender.

Experienced bookkeepers can also help you by:

  • Advising you on tax savings. You’ll have a better idea of what you can deduct and how to reduce your taxes.
  • Providing answers to your financial questions. Bookkeepers can help you learn about financial reports, cash flow, depreciation, and more.
  • Identifying opportunities to improve profitability. They’ll have a clear picture of where you improve your business finances.
  • Keeping you tax-compliant and secure. Bookkeepers are familiar with tax laws and other legal considerations, so you won’t miss deadlines or have noncompliance penalties.

How do you outsource bookkeeping?

There are two primary options to outsource bookkeeping–virtual bookkeepers or local bookkeepers.

Virtual bookkeepers

If you hire a bookkeeper online then that would be considered a virtual bookkeeper.  xendoo, for example, is a virtual bookkeeping service. Our team of bookkeepers works with you virtually, no matter where you a located in the United States. 

However, there are some differences between xendoo’s bookkeeping services and other virtual bookkeepers. For instance, you might hire a freelance virtual bookkeeper that performs the same tasks that a regular bookkeeper would–they just do them online. 

The drawback of hiring an individual freelance bookkeeper is that they tend to be more expensive. Like an in-person, local bookkeeper, freelancers usually charge an hourly rate vs a set monthly payment.

They also may not have as many resources as a bookkeeping firm or company. For instance, when you get a xendoo plan you also get perks like access to accounting software like QuickBooks and Xero. 

Another advantage of virtual bookkeepers is that because they work online, they tend to be familiar with different eCommerce platforms, payment processors, and other online financial services. Therefore, they can help you integrate your business banking account, expenses, and other financial data into a secure accounting system. With that, you can view your financial health, prepare for taxes, or plan for your business future at any time. 

Local bookkeepers

If you hire a bookkeeper that has an office or business location near you, that would be considered a local bookkeeper. Local bookkeepers usually charge by the hour and it tends to be expensive.

For instance, it is not cost-effective if you need to book more than one or two hours a month. This might make sense if you are booking an hour for a bookkeeping consultation a month. However, in this case, you would still be responsible for doing your own books.

If a local bookkeeper is managing your books and you have a complex business with many employees and revenue streams, it’s probably going to take more than a few hours a month. Those hours can get expensive.

In most cases, you don’t need a local bookkeeper unless:

  • You want to meet with your bookkeeper in person on a regular basis.
  • You keep your financial information in physical records only. 

Whether or not you use a local bookkeeper is based on your preference. Today, most accounting and bookkeeping tasks are performed online anyway. Therefore, the majority of businesses prefer online bookkeeping, because it’s more accurate, cost-effective, and easier.

How much does outsourced bookkeeping cost?

The size of your business and the number of monthly expenses you incur play a large role in the pricing for outsourced bookkeeping services. To get a better idea of how much outsourced bookkeeping costs, let’s compare it with some other bookkeeper options.

In-house bookkeeper cost

An in-house bookkeeper is usually considered a full-time employee, which means they would get a salary and benefits package. According to Salary.com, the cost to hire a full-time entry-level bookkeeper is $45,446. That is just the base salary and doesn’t include benefits or bonuses.

Of course, the cost rises in cities that have a high cost of living. It also increases when hiring bookkeepers with more years of experience. For example, in San Francisco, the living wage is higher. The average annual salary for business and finance professionals is $84,198, according to MIT. 

Most small businesses don’t have enough bookkeeping needs to justify paying a bookkeeper year-round for their services. They may consider a freelance bookkeeper or an hourly bookkeeper, however, that might be just as costly.

Local or freelance bookkeeper cost

If you look at any freelance marketplace you’ll find that the cost for freelance bookkeepers ranges widely.

It’s not unusual for the hourly rate for freelance bookkeepers to range from $21 per hour to $60 per hour.  However, more experienced freelance bookkeepers will charge upwards of $75 or more per hour, especially if they are doing complex bookkeeping or accounting tasks.

If your business has a lot of bookkeeping needs, a local or freelance bookkeeper who charges by the hour usually is not cost-effective. When you only get an hour of their time, you probably won’t get all your bookkeeping questions or concerns answered.

Outsourced bookkeeper cost

Of all the bookkeeping options, outsourcing tends to be the most cost-effective for small businesses. This is because you’re not hiring a full-time staff member or being charged an hourly rate.

Outsourced bookkeeping services usually charge a set monthly fee. These are popular with small businesses because the bookkeeping services come in packages based on your needs. 

It’s easier to budget for a monthly cost that’s the same each month. Plus, it costs half of what you could end up paying for an hourly bookkeeper. That’s why xendoo offers this pricing structure with a variety of package options to fit your specific company’s needs. 

How does outsourcing with xendoo work?

If you choose to go the outsourced bookkeeping route, you’ll be paired with a dedicated bookkeeper. Plus, because we are a team of financial experts, you’ll also get access to a CPA and an accountant. 

Your expert bookkeeper will set up a digital accounting system for you if you don’t already have one. This means that we’ll take your sales and revenue data, expenses, payroll, etc, and put it all together in one financial dashboard. You’ll be able to access it anytime–desktop or mobile–and get monthly reporting with balance sheets and profit-loss statements. If you’d like to learn more, you can schedule a consultation with our team here.

 

Business Lessons from a Breast Cancer Survivor: An Interview with xendoo COO, Julia Aquino

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A group of breast cancer survivors hugging and smiling at each other
Julia Aquino, xendoo COO, poses with the Breast Cancer Awareness Month pink ribbon.

Julia Aquino, xendoo COO, recognizes Breast Cancer Awareness Month.

As we begin Breast Cancer Awareness Month, we spoke with xendoo COO and breast cancer survivor, Julia Aquino. She was diagnosed with breast cancer in 2012. She knew that she needed a deep understanding of the disease in order to make the best decisions for her health, while also running a successful business. 

 

Armed with knowledge and clear goals for recovery, she survived and thrived through treatment. In today’s post, she shares what her experience with breast cancer taught her about business. 

Make a Plan

When Julia was first diagnosed with breast cancer, she dove into researching the disease. She learned how cancer was typed, what the terminology meant, and how the medication worked. She understood her family history, and the stage she was in. This knowledge helped her to coordinate with her doctor to create an effective plan for care and survival. It kept her focused and determined as she fought the disease. 

 

Having a business plan provides the same focus and determination to meet your goals. When you pair that determination with knowledge of your industry, audience, and competition, you can reduce your competitive risks and navigate difficulty with confidence. Your business plan is your roadmap that helps you take focused action and make informed decisions as your business grows.

Know Your Numbers

There are many numbers associated with cancer. Your staging, your white blood count (WBC), tumor marker levels, hormone levels, and FISH levels, to name a few. It can be very intimidating. Taking the time to understand your numbers and their significance will provide you with factual information so you can understand where you are, and what options you have. It reduces fear-based decision making, and brings clarity to an otherwise overwhelming situation.

 

The same idea applies to business. When you know your numbers, you can make better decisions, based on facts. Sometimes we don’t want to look at our financials because we do not understand them, or because they show we are not as profitable as we would like to be. However, there is always information that can guide our actions, and help us find solutions. Take the time to understand your key metrics and trends, measure the outcomes of the actions you take, and adjust behaviors when needed. The financial insight gained from this review can be used to effectively address issues and strategize for long-term success.

Find a Support System

Those who are battling breast cancer have a lot on their shoulders; they balance work, their lives, their hopes and fears, and their health. It can be physically and emotionally draining. The right medical team, supportive friends and family, and a healing environment can provide comfort in the most difficult moments. Finding a support system that encourages them to keep moving forward makes all the difference in the world. 

 

Likewise, business owners juggle multiple roles, including leader, sales, customer service, and even bookkeeper. Shouldering all of those responsibilities can become overwhelming and exhausting. Business owners need a supportive team who complements what they lack experience in, and takes the stress off of their plates. 

 

You do not have to do it all on your own. Build a supportive team that covers all the bases, so you can do what you do best – growing your business. In discouraging moments, your team will push you to dust yourself off and refocus on your business goals. In moments that you need to step back, they will be happy to step up to keep the business running. When you are ready to jump back in, remember the true power you have, rely on the support you are surrounded with, and keep moving forward. 

Celebrate Your Victories 

To all who are battling breast cancer, we support you and are amazed by you. You work hard every day and fight the good fight, so take time this month to remember your strength, honor your courage, and celebrate every victory, no matter the size! Every step you take moves you further into the mindset of “I can and I will”.

Watch the full interview with Julia below: