We all know how important accountants are during tax season, but business accountants are more than that.
They provide valuable resource and can be a trusted advisor throughout the year as you run your business.
A good business accountant will do more than just your taxes..
They will be with you each step of the way as you work on building and expanding your business.
They can provide the knowledge and expertise to create a comprehensive, detailed, and efficient business plan, and help you achieve each of your financial goals.
Making and keeping an open channel of communication between you and your accountant is crucial to keep tabs on your business’ health.
Do You Include Ad-Hoc Accounting In Your Fees?
This is probably the most common concern of people in need of financial advice.
However, a good accountant or accounting firm will never trouble small business owner with this aspect.
Thus, before you even start engaging with your accountant, make sure you have set the parameters are clear about their fees and what should be included or not.
As said earlier, it’s important to keep a good communication line with your accountant, and nothing damages a relationship more than one party being reluctant to pick up the phone and talk.
Furthermore, when getting the services of a bigger firm, you have to establish your point of contact and the channels they can be reached on.
This will give you the confidence to reach out to them when you need them.
Do they use zoom or other communication tools?
Can you reach them through their mobile number?
Do they reply to your emails promptly?
You need to answer these questions.
What Is My Break-Even Point?
Breakeven point is the sales you need to have to fully cover your overhead, and it’s where you start to move to your profits.
The idea may be easy – sell more than you spend.
But as with many aspects in business, it’s not that always cut and dry.
And there are many aspects that could change that.
Sales cost for example, can differ with volume or the ongoing promotion cost that affects your business, negatively.
Depending on the nature, size, market, etc., you can break this down to daily, weekly, or even monthly.
A good accountant will analyze the cost structure and workout your break-even points.
What Really Drives My Revenue?
We constantly need to increase sales, that’s a fact.
However do you know exactly where to start?
One good way to know is to determine the key drivers of your revenue.
For most businesses, revenue can be broken down to this formula:
No. of customers x Frequency of Transaction x Average Value of Transaction = Revenue.
You may need a slightly different formula for your particular business, and your accountant can definitely help you with that.
Ask your accountant where to focus.
Some of the common areas you need to work on are:
- Keeping existing customers
- Getting new leads and enquiries
- Converting leads to new customers
- Getting existing customers to buy more frequently
- Analyze pricing strategy
- Have more ways to sell more in every transaction
Obviously, each business is different, and different businesses will have to focus on different varieties of strategies too.
The most common aspect that is used in almost any nature of business is the pricing strategy.
Talk to your accountant about it.
Should you increase your prices?
If so, how many customers could you possibly lose?
Could you afford to lose them?
These are the burning questions every business owner should ask his accountant.
They can be tough, but they’re necessary for your business’ financial health.