Want to cut unnecessary costs, optimise the most profitable parts of the business, and increase your overall return on investment? Let’s talk about how we can work together to support your ongoing business profitability.
I don't know about you, but making a profit is fairly high up on my list of goals, right alongside figuring out how Gmail actually works and buying a castle. Unfortunately, I'm a bit rubbish when it comes to email settings and my wife doesn't really want to live in the countryside with me at the top of a tower wearing a tinfoil crown whilst screaming "I'm the King of the castle" at the top of my lungs. The one thing that I can control, is my profit.
If you want to generate the best possible margins, you need to keep an eye on what's coming in and going out of your business, so how can an accountant help with this?
In days gone by, you'd go to your accountant at the end of the year and hand over your big bag (or shoebox) of receipts, invoices and bank statements. You'd then wait a couple of months and you'd find out if you'd made a profit or not. Nowadays, most accountants like to be a little more involved in their clients' business and to help them focus on financial performance and business strategy on an ongoing basis to help put you in better control of your finances. This is one of my favourite parts of the job- having a real insight into a business whilst helping them to achieve their plans.
What are the key ways an accountant can enhance your financial health?
As a general rule, the less money you spend, the greater your profit (this isn't always true as you occasionally have to spend money to make money i.e. advertising). However, if you're not in control of your financial management, you don't know your gross profit from your net profit or what you're spending on staff as a percentage of revenue then you're going to find it incredibly difficult to know where you're spending your money, and why you're not achieving your goals.
This is where having an accountant can add a fair amount of value, particularly as it is becoming more and more likely that we're heading toward a recession. Essentially, we can help you to get back in the driving seat of your finances using various methods:
- Tax planning and advice- tax costs are one of the largest costs for any business and HMRC is the largest creditor for most. Not all business owners understand the Employment Allowance when running their own payroll and even fewer understand the ins and outs of how VAT is applied differently for certain takeout items and even less than that are aware that Hospitality and Catering businesses may be eligible for R&D claims. We'll make sure that you're making the most of all tax allowances and incentives so that you'll own pay what you're legally required to pay.
- Cost control and expenditure management- this is a really simple concept- to improve your cashflow you need to reduce your cash outflow (outgoings), but it can often be difficult to see where you can cut costs. We'll help you to focus on reducing your expenditure and to remove unnecessary costs as well as running supplier comparisons so that you're able to negotiate better deals. The more you cut back on unnecessary spending the easier it will be for you to grow your business and make it more profitable.
- Cashflow management and advice- unless you know exactly what you've got coming in and going out at any given point, you'll always find yourself on the back foot trying to pay your creditors. We'll show your where money is going out, and coming in, so that you're better able to balance your positive cashflow position.
- Better management reporting and information- the decisions you make about your business are based on the financial information that you have to hand- poor information will always equal poor decisions. We provide detailed, easy to read management accounts with breakdowns of your key performance indicators and compare these with your agreed budget, all to enable you to save money, better control costs and make sound business decisions.
- Forecasting and financial modelling- when we understand your business goals and the key financial drivers in your business, we can build you a full financial model. This allows us to forecast for different scenarios and variables i.e. "what happens if...?" Having several different financial plans in front of you based on what could happen is the best way to prepare for when "what if...?" actually does happen. Keeping an eye on the possible roads ahead will enable you to adapt quicker to change as well as giving you the ability to target your management team.
Talk to us about cutting costs and boosting profit
Rather than running your business via the "finger in the air" method, by working with an accountant you get a clear picture on your business financials. We’ll help you cut unnecessary costs, optimise the most profitable parts of the business and increase your overall return on investment.
Let’s talk about how we can work together to support your ongoing business profitability.