Author: Jennifer Brazer

Determining per unit cost may be a very common aspect in the manufacturing industry, but it is no surprise that it must be handled professionally. No matter what one may argue, calculating work requires the utmost brilliance and perfection in technical accounting knowledge. Determining raw material, labor, and overhead costs incurred in manufacturing a certain good is no easy feat.

You have to carefully examine and evaluate the costs of producing a finished good at various stages of the production process before determining the total cost incurred on producing a good or a commodity. WIP (Work In Process) is usually used in production and supply chain management, which is immensely important in the manufacturing and distribution.

What Is Work in Process?

According to Investopedia, “It is the sum of all costs put into the production process to manufacture products that are partially completed.” A careful analysis has to be made at various stages of the production process to determine all the costs incurred on raw materials, labor, and overhead. To determine the exact unit cost, you must have a clear picture of all the costs incurred from raw materials to finished goods. It is important that your bookkeeping shows all the costs to come up with your final cost.

As far as the calculations are concerned, the formula for calculating work in process is:

Work in process = (operating inventory goods in process + raw material used during the period + direct labor during the period + factory overhead for the period) – ending inventory.

WIP–In Light Of Automation and Technology

Fortunately, we have opened our eyes in such an era of modern accounting and bookkeeping, where processes have become easier through superior automation and technology. Now, we have access to advanced accounting software and solutions, making calculations easier, quicker, and more accurate. It indicates that calculating work in process is now considered a piece of cake for most individuals with command and control over this contemporary accounting and manufacturing software.

Plus, we now also have access to accounting and bookkeeping professionals who make the process easier and help reduce manufacturing costs at various stages of the production process.

Benefits of Reducing Manufacturing Work in Process

There are numerous benefits associated with reducing manufacturing work and process costs. The top benefits include better cash flows, higher liquidity, and diminished business risks. However, a brilliant execution strategy is required to make things go in your favor. Since the ultimate aim of every manufacturing establishment is to reduce raw material, labor, and overhead costs in each unit produced, you must integrate innovative procedures and techniques to eradicate manufacturing bottlenecks. Moreover, calculating work in process may seem hard at first, but once you sort things out piece by piece (costs), everything becomes relatively easier to handle.

Strategic Forecasting and Planning and the Need for Calculating Work in Process

Undoubtedly, strategic forecasting and planning are critical to business success. The more you get involved in reducing per-unit costs, the more you will save at the end of the day. To determine how many units should be produced, as well as raw material costs, labor costs, and overhead costs, you must clearly understand your production requirements and specifications. Strategic variety usually involves realistic vision, mission, and out-of-the-box thinking for making future projections related to manufacturing and production.

Moreover, strategic planning and analyses will define where your company is heading and what the company aims to achieve in both short and long-term periods. Machines can be added or integrated into the manufacturing process, and the workforce can be educated with newer and advanced techniques for optimal utilization of resources to attain ideal results. Calculating work in the process must be handled carefully because it directly influences your profitability index.

About Complete Controller® – America’s Bookkeeping Experts Complete Controller is the Nation’s Leader in virtual bookkeeping, providing service to businesses and households alike. Utilizing Complete Controller’s technology, clients gain access to a cloud platform where their QuickBooks™️ file, critical financial documents, and back-office tools are hosted in an efficient SSO environment. Complete Controller’s team of certified US-based accounting professionals provide bookkeeping, record storage, performance reporting, and controller services including training, cash-flow management, budgeting and forecasting, process and controls advisement, and bill-pay. With flat-rate service plans, Complete Controller is the most cost-effective expert accounting solution for business, family-office, trusts, and households of any size or complexity.

No matter how much one may argue about who is solely responsible for cloud data protection, experts from all across the globe are unanimous on the resolution that the ultimate responsibility of data compliance lies with the organization that owns the sensitive information, not the service provider.

What Is Cloud Data Protection?

Looking at the big picture, cloud data protection (CDP) is all about infrastructure security, storage management, and data integrity. Since it provides optimal data storage, protection, and network security, businesses worldwide trust it to be safer, more secure, and more stable than ever. It protects the cloud and prevents the leakage or theft of sensitive information from the cloud. Since the ultimate objective of CDP is to protect static and moving data in the cloud and ensure various services and processes, it is critically important for you and your cloud provider to ensure its optimal functioning at all levels.

Data integrity: Data remains the same as it is stored as strong encryption layers protect sensitive data from illegal editing or corruption. It indicates that your sensitive data is secured against all threats or illegal access.

Storage Management: The cloud infrastructure must ensure data safety and security and provide a continuously available interface as desired or required. Primarily, it depends on your cloud service provider’s capacity and how agile or responsive they are in managing the account. However, it would help if you also ensured the data was correctly maintained.

Infrastructure security: These are collective efforts, processes, measures, and policies that ensure cloud infrastructure and network security. However, most small-scale businesses do not pay much heed to cloud data protection protocols. That’s where most problems related to the safety and security of sensitive data commence arising.

Why Are Most Businesses Misguided?

It’s a human tendency to shift responsibilities or critical tasks entirely onto someone else’s shoulders. Most of us do not want to take complete ownership of complicated things with intense and severe repercussions (if not executed properly). Then, there are those people who are misguided about their responsibilities and rely entirely on others. No matter how much money you can afford to spend on acquiring any pro cloud provider’s services, you have to make efforts to secure your data yourself and not solely rely on your service provider.

Although people have different perspectives about data safety and security and whether or not to trust the cloud entirely, cloud data protection is inevitably the most critical aspect of the cloud. Without this, you can never expect to secure sensitive data. According to a study, 80% of businesses wrongly believe that data protection and management is solely the responsibility of their cloud service provider. It indicates that cloud service providers are responsible for providing certain security protocols or encryption layers. However, the protection, safety, and security of sensitive information lie in the hands of businesses.

The study further revealed that businesses prefer to transfer their data protection, privacy, and compliance responsibilities to third-party cloud vendors or service providers to focus more on the core side of the business and less on its security, storage, or management affairs. Moreover, the total spending on cloud technologies is predicted to increase by 20% from 2018 to 2020. It bears testimony that most businesses intend to transfer their cloud data protection-related responsibilities to cloud service providers.

Core Reasons Why Most Businesses Choice To Hire Pro-Level Cloud Services

Companies prefer to embrace an easy approach to protect their sensitive data because they lack in-house skills, knowledge, experience, and expertise in handling cloud data protection optimally. However, you need to ensure that the cloud service provider you are acquiring for utilization has relevant skills and provides 24/7 assistance in managing cloud-related discrepancies effectively.

: About Complete Controller® – America’s Bookkeeping Experts Complete Controller is the Nation’s Leader in virtual bookkeeping, providing service to businesses and households alike. Utilizing Complete Controller’s technology, clients gain access to a cloud platform where their QuickBooks™️ file, critical financial documents, and back-office tools are hosted in an efficient SSO environment. Complete Controller’s team of certified US-based accounting professionals provide bookkeeping, record storage, performance reporting, and controller services including training, cash-flow management, budgeting and forecasting, process and controls advisement, and bill-pay. With flat-rate service plans, Complete Controller is the most cost-effective expert accounting solution for business, family-office, trusts, and households of any size or complexity.

Achieving the right strategic balance in inventory at the beginning of a new business is not easy. Manufacturing businesses aim to minimize their work in process to maximize their profitability. Simultaneously, they also look for alternative routes to minimize their production and post-production costs as much as possible to increase their yearly profits.

Finding the right WIP costs is hard for small businesses, such as a bakery, since you cannot anticipate exact labor and overhead costs where ingredients are easily transformed from raw material to a finished product. You can easily calculate WIP through accounting/bookkeeping knowledge and wisdom for big setups.

Is There A Difference Between Work In Process And Work In Progress?

Work in Process

These terms are often used interchangeably because WIP is perceived as the same thing. However, there is a slight difference between these two terms that mostly lie in the context. Work in Process refers to partially completed goods’ production costs, which means the manufacturer’s inventory is not yet completed. It includes different costs like raw materials, labor, and overheads that need to be known to determine the per-unit cost of goods manufactured.

It indicates that work in Process speaks more of the inventory side, whereas work in progress involves constructing long-term costs. To lower work-in-process costs, manufacturers must play smart and purchase raw materials from the most affordable vendors. Also, they need to hire labor for the production shifts at competitive rates and minimize overhead costs as much as possible.

The final per-unit price can only be determined if manufacturers know the exact output level from the resources applied. In short, whatever is consumed on the factory floor for the production of goods, such as the direct cost of raw material, direct costs of labor, and factory overheads for the production period. This will give an exact per-unit cost. The formula for calculating Work in Process is:

Work in Process = (operating inventory goods in Process + raw material used + direct labor during the period + factory overhead for the period) – ending inventory

Work In Progress

Work in progress involves constructing long-term assets that will be used to produce goods that are not yet completed. Until construction work is completed and the facility starts to manufacture goods, the amount spent on partially completed construction of long-term assets would fall under work in progress. 

The amount spent will be treated as long-term assets under the balance sheet’s plant and equipment section. Construction will no longer be treated as a work in progress when it wraps up. Depreciation of long-term assets starts as soon as the whole building and infrastructure are operational and produce goods.

Cost Saving Benefits

The key cost-saving benefits of work in Process and work in progress are efficiency, accuracy, traceability, and productivity. Every production house strives to minimize the work of the process due to a lack of production or manufacturing knowledge and awareness. Businesses can’t survive for long if the per-unit price of goods is only based on vague assumptions and mere guesses.

Knowing the manufactured product’s actual price is essential for setting the product’s correct price with markup. For example, if you can determine the exact per-unit price of the product to be $5 and if you expect to sell the product directly to the retailers for $7, which means a markup of $2, you will know exactly how much profit you are earning by selling each unit.

Work In Progress—Done Right!

You may be proficient at manufacturing goods in your production facility, but not cost. For ideal costing, you need to hire an in-house accounting expert to determine and reveal the exact per-unit cost of production. Based on manufacturing and bookkeeping records, the expert will help you place the right production order for optimal results.

About Complete Controller® – America’s Bookkeeping Experts Complete Controller is the Nation’s Leader in virtual bookkeeping, providing service to businesses and households alike. Utilizing Complete Controller’s technology, clients gain access to a cloud platform where their QuickBooks™️ file, critical financial documents, and back-office tools are hosted in an efficient SSO environment. Complete Controller’s team of certified US-based accounting professionals provide bookkeeping, record storage, performance reporting, and controller services including training, cash-flow management, budgeting and forecasting, process and controls advisement, and bill-pay. With flat-rate service plans, Complete Controller is the most cost-effective expert accounting solution for business, family-office, trusts, and households of any size or complexity.

Corporate culture refers to a shared set of norms, values, assumptions, and beliefs that govern employees’ organizational behavior in a workplace. This culture defines how employees behave with one another in the organization, and it influences each one in some way. As for organizations that operate in virtual workplaces, employees are connected remotely. Hence, a shared set of values is often missing. Therefore, an increasing need to teach a healthy virtual culture ensures that each remote worker feels a part of the team (sense of belonging).

Why do Virtual Workplaces Require a Corporate Culture?

It is essential to identify why a virtual workplace requires a corporate culture. First, there needs to be sufficient trust among remote employees. Lack of trust among employees connected virtually can lead to work disruptions, such that employees may not be willing to work as a team.

Second, to introduce the leadership model in a virtual workplace, a set of shared beliefs and values becomes inevitable. People who are connected remotely will find it very difficult to accept another remote employee’s leadership. Leadership is a requirement for physical workplaces and becomes even more important if geographical locations separate employees.

Employees in a virtual workplace may also feel isolated as their interaction is limited, which obstructs open, informal, and social communication between team members. This hampers employees’ growth aspect regarding social skills, effective communication skills, and interaction outside the work environment. Digital interaction does not allow for gestures, body language, or a pat on the back for a well-done job. These elements tend to be missing in a virtual workplace, but a common corporate culture could somewhat fill this void.

How to Build a Corporate Culture in a Virtual Workplace

The following are a few methods that may be used to stimulate a corporate culture in a virtual work setting:

• For remote employees to discuss and perform work projects, computer-based chat rooms must be set up. This will enable open communication channels in a virtual workplace.
• Moreover, virtual collaborative tools may be used to exchange ideas and share viewpoints and opinions on the various tasks assigned to remote employees, be it for basic bookkeeping.
•  Virtual socialization tools must be set to ensure that remote employees can engage in informal and personal conversations. This is likely to induce social interaction among employees and result in trust among remote employees, something they had been missing due to physical limitations.
• Virtual employees lack a sense of engagement To cultivate a culture whereby social skills may be enhanced. This may be countered using video calls and video conferences to make face-to-face interactions possible. This way, gesturing and body language can convey messages to remote employees.
• Once in a while, employees may be arranged to meet one another physically at a conference or annual dinner. This is another way to ensure that a corporate culture seeps into the virtual workplace. These meetings will develop a set of shared values, beliefs, and norms that all remote employees can become accustomed to.
• Another method to instill a corporate culture in the virtual workplace is through constant feedback from remote employees. Employees may be asked their views regarding what’s missing in the virtual culture and what needs to be amended. Their valuable insights can be used to make the required alterations because the employees make up a corporate culture, after all.
• Virtual employees may be granted full ownership of their projects to allow delegation. This is another method for ensuring employee trust and inseminating a sense of belonging.

Conclusion

Virtual workplaces can make remote employees feel less motivated and alienated, provided the lack physical interaction. However, corporate culture is as necessary for a virtual work setting as it is for a physical workplace. Efforts may be dedicated toward establishing a virtual culture for remote employees using the methods above.

About Complete Controller® – America’s Bookkeeping Experts Complete Controller is the Nation’s Leader in virtual bookkeeping, providing service to businesses and households alike. Utilizing Complete Controller’s technology, clients gain access to a cloud platform where their QuickBooks™️ file, critical financial documents, and back-office tools are hosted in an efficient SSO environment. Complete Controller’s team of certified US-based accounting professionals provide bookkeeping, record storage, performance reporting, and controller services including training, cash-flow management, budgeting and forecasting, process and controls advisement, and bill-pay. With flat-rate service plans, Complete Controller is the most cost-effective expert accounting solution for business, family-office, trusts, and households of any size or complexity.

Who Might be Attracted to Invest Capital?

As the measure of funds needed expands, you will be required to get to an inexorably refined investor looking for the greatest return without expecting the risk of a new venture. Family and companions are usually the first groups to be looked upon by entrepreneurs looking for capital – they are more neutral than proficient financial specialists. They will probably continue contributing more because of the relationship than the business proposition’s financial matters. Then again, family financial specialists bring their arrangement of issues, including the likelihood of stressed relations if the venture comes up short. Attracting investment capital needs careful consideration of these options.

VCs and Angels Funding are Rare

While entrepreneurial magazines and sites advance the accessibility of angel investors and funding capital (VC) firms for bookkeeping capital, not every startup firm gets the opportunity. With the tough screening process of these financial specialists, not every new venture gets shortlisted. However, they might be attracted to invest capital if sufficient arrangements are in place.

Crowdfunding May Be Considered

Another subsidizing system known as “crowdfunding” was made in the Jumpstart Our Business Startups Act of 2012 (JOBS), enabling small organizations to raise to $1 million from people over the Internet with a yearly wage of under $100,000 through a streamlined enlistment strategy and restricted money related data.

While the bill has pulled in intense pundits stressed over-expanded false exchanges, most onlookers who trust this Act will give required access to new finances for new businesses. Locales, for example, Kickstarter and GoFundMe, enable business people to achieve new cash sources adequately and reasonably.

What are the Legal Responsibilities to Potential Investors?

By and large, entrepreneurs looking for reserves from singular investors must give structures and particular verifiable data in a justifiable dialect to potential financial specialists to book the investment and decide if it is ideal for them. Offerings and proceeded with organizations’ legitimate commitments to their financial specialist, proprietors are controlled under the US Securities Act of 1933 and the Securities Exchange Act of 1934.

While jobs are expected to disentangle the techniques, making it less demanding for small firms to get to the equity markets, consistency with the relevant regulations is required. Looking for and paying for competent legal advice while requesting, arranging, or contracting with investors or banks is required for reasonable entrepreneurs.

How Do I Negotiate a Win-Win Agreement?

Negotiation is an important skill for attracting investment capital. Regardless of whether for a startup or a continuous operation, a financing occasion includes two gatherings: the investor and the organization. Sometimes, there is a solitary financial investor; in others, there are various investors. In the last case, for example, a crowdfunding occasion, the financial specialists take an interest as a unit, each sharing an extent of a similar venture. Sometimes, funding is a take-it-or-leave-it choice; in others, intense negotiations are involved. For each situation, the parties seek an understanding that finishes their objectives.

Arrangements among investors and entrepreneurs include at least the following variables:

• The Amount of Capital Invested. Financing might be a solitary sum or a mix of investments over a period.
• The Timing of the Investment. A particular sum is contributed to with future investments on particular dates or when certain possibilities have been met.
• The Return on Investment. In debt, return, or from the organization’s viewpoint, “cost” might be communicated as an interest with particular installment periods and principal amortization. In value, the return is the proportionate offer of future profit directed to the financial specialist.
• The Timing of the Return to the Investor. Later, planned installments bookkeeping will be marked down to mirror the investor’s opportunity costs and the risk-free return he would have generally earned without the venture.
• The Certainty of the Return. Since the return on capital will be in the future, financial specialists normally worry about the probability of the anticipated outcomes being real. This “risk” increment straightforwardly corresponds to the period between the venture and anticipated return, the span of the return concerning the investment, and the unwavering quality of the fundamental budgetary and working suppositions.
• Who makes decisions when things don’t go as arranged? Financial specialists generally require certain insurances to limit losses or to capitalize profits when possible.

Negotiation is an aptitude that can be learned and can be rehearsed. Be as it may, learning at the table across a seasoned professional is typically costly.

About Complete Controller® – America’s Bookkeeping Experts Complete Controller is the Nation’s Leader in virtual bookkeeping, providing service to businesses and households alike. Utilizing Complete Controller’s technology, clients gain access to a cloud platform where their QuickBooks™️ file, critical financial documents, and back-office tools are hosted in an efficient SSO environment. Complete Controller’s team of certified US-based accounting professionals provide bookkeeping, record storage, performance reporting, and controller services including training, cash-flow management, budgeting and forecasting, process and controls advisement, and bill-pay. With flat-rate service plans, Complete Controller is the most cost-effective expert accounting solution for business, family-office, trusts, and households of any size or complexity.

Businesses face several accounting costs that can easily be identified and calculated when conducting day-to-day business operations. Companies, however, also face other economic costs that are not displayed on the bookkeeping records and have a significant impact on the decisions made by management. Accounting costs are crucial for the company’s external and internal reports. At the same time, economic costs apply to the internal sector only.

Implicit Costs

Economic costs reflect a company’s implicit and explicit costs during the year. Implicit costs are linked to resources offered to a company without any price tag. If a company operates from a building it owns, it encounters an implicit cost due to the rent that could have been earned by leasing the building to some other company. The owner could have earned around $3,000 monthly from a commercial renter. Therefore, in this case, the company faces an implicit cost of $3,000, referred to as its economic cost.

Explicit Costs

Accounting costs are generated from the overall explicit costs of a business throughout the fiscal year. They do not include the implicit costs coming from unused resources. Explicit costs defined by their monetary value are included in a business’s accounting costs to identify the net income.

Explicit business costs include the following:

• Salaries, wages, bonuses, commissions, and any other form of compensation dispensed to company employees
• The cost of benefits provided to employees, such as insurance
• Material costs – Refers to any materials that a company must purchase to produce the products and services that it sells
• Marketing and advertising costs
• Rent or mortgage payments on company facilities
• Utilities, such as electricity and internet service
• The costs of purchasing, using, and maintaining equipment that a company requires to operate, such as manufacturing machines or vehicles
• Taxes, insurance, legal fees, etc.
• Depreciation

Accounting Profit

If an accountant or bookkeeper wants to calculate the financial year’s accounting profit, they only have to look at its profit and accounting costs. The accountant can form an income statement for the company without the economic cost details. For instance, accountants have no concern that the company could have made $3,000 by leasing the building to some other business, making around $36,000 during the financial year. This $36,000 has nothing to do with the company’s gross profit during the financial year.

Economic Costs are not Included in Bookkeeping

Economic costs are not written or mentioned in a company’s accounting records or bookkeeping. When creating financial reports, accountants are focused on the explicit costs generated from the business operations conducted throughout the financial year.

However, Economic costs are generally considered when a company has to make strategic decisions involving opportunity. For example, suppose a company has intended to close down an operational location and rent or lease it out to another business. In that case, the company needs to consider the economic costs of losing the money generated from business operations or the profit generated from the rent.

Economic cost generally comprises the monetary value of resources the business employs. Also, it links to the opportunity cost that arises from the enterprise’s inputs to make the business functional.

On the other hand, accounting costs are focused on explicit costs incurred by the business. Any company’s costs in normal, day-to-day market transactions are referred to as explicit costs. One common example of explicit costs includes wages that are given to employees. The money spent buying the resources the business needs is also known as explicit costs.

While the economic cost may not be included in the company’s bookkeeping and, therefore, would not be the bookkeeper’s responsibility, it is recommended that you hire an accountant to handle all financial aspects of the company. A certified accountant would manage all financial bookkeeping operations and the company’s economic costs.

About Complete Controller® – America’s Bookkeeping Experts Complete Controller is the Nation’s Leader in virtual bookkeeping, providing service to businesses and households alike. Utilizing Complete Controller’s technology, clients gain access to a cloud platform where their QuickBooks™️ file, critical financial documents, and back-office tools are hosted in an efficient SSO environment. Complete Controller’s team of certified US-based accounting professionals provide bookkeeping, record storage, performance reporting, and controller services including training, cash-flow management, budgeting and forecasting, process and controls advisement, and bill-pay. With flat-rate service plans, Complete Controller is the most cost-effective expert accounting solution for business, family-office, trusts, and households of any size or complexity.

Operating a small business is stressful and time-consuming. Also, maintaining the inventory can become a troublesome task. Keeping track of how much you have in stock of any particular product and knowing when you need to order more can help prevent overselling or urgently needing to order an item. A good quality inventory management software can make the tedious task of tracking your inventory a whole lot easier.

Inventory Management Software 

An inventory management software can help you focus on other, more important aspects of your business. The inventory software should be able to:

• Give you an alert when any particular product is low
• Track sales and adjust the number of products in stock
• Record and display customer information in an organized manner
• Update any product requirements upon the receipt of new orders
• Provide sales and purchase data that can be used for bookkeeping purposes

When choosing the right inventory software, many things must be considered. Trial and error aren’t always feasible when utilizing a particular software’s services in your business. The many aspects used in selecting the right inventory management software can be related to User Interface, Accessibility, Data Representation, etc.

The primary criteria for our top 5 list below are accuracy and efficiency. Any inventory management software should be able to report your inventory accurately. Furthermore, it should have a good enough user interface to allow users to easily utilize its services and features. The primary purpose of inventory management software is to track your inventory more efficiently, and it would serve no purpose if it complicates the process altogether.

Another aspect of inventory management software is product Imports. Good inventory software makes adding new products to the stock an easy process with accurate results. A bar code is one of the most common ways to import products into the system. Still, recent innovations in product logistics require software to be able to import through CSV files and other methods.

Finally, deciding which inventory management software you should use depends on your business’s requirements. Warehouses and stores each have different requirements when it comes to inventory software. Similarly, how you sell your products also impacts what you may need from your inventory management software.

The Final Verdict – Top 5 Inventory Management Software

Fishbowl

Fishbowl is one of the best inventory software on the market. It is a good choice for warehouse businesses, although it also works for other businesses. It helps manage inventory through user-friendly prompts. It is also designed to handle larger inventory amounts and is the top software available for warehouse businesses. It is also recommended for small and medium-sized companies.

inFlow

This inventory management software provides a good set of features. It has an easy-to-learn user interface. The interface is also supported through an online database. The features are easy to use, and the software is good for businesses of any size but is recommended for small to medium-sized businesses.

TradeGecko

This software is efficient in terms of product importing. It is also known for having an amazing user interface. The interface is also supported online, and the features cover various inventory needs.

Odoo

Odoo offers ease of integration with various parts of your business. Odoo helps bridge your inventory needs with other daily operational needs. It is user-friendly and only requires a little tech knowledge.

Inventory

This is one of the more cost-effective solutions for inventory management software. Small and individually owned businesses widely use this software because it is easy to use and at the lower cost afforded by small businesses.

Conclusion

In conclusion, the challenges of operating a small business, compounded by the complexities of inventory management, necessitate effective and efficient solutions. The arduous task of keeping track of stock levels, anticipating reorder points, and maintaining organized records can significantly impact a business’s success. Enter inventory management software, a transformative tool that streamlines these processes and allows business owners to focus on critical aspects of their operations.

As outlined in our top 5 list, high-quality inventory management software goes beyond mere tracking; it acts as a strategic ally in business growth. The software’s ability to provide timely alerts for low-stock items, track sales for accurate inventory adjustments, organize customer information, and seamlessly update product requirements upon new orders makes it an invaluable asset. The software contributes to efficient bookkeeping by generating comprehensive sales and purchase data.

When selecting the right inventory management software, considerations of user interface, accessibility, data representation, and, most importantly, accuracy and efficiency are paramount. The software should simplify rather than complicate the inventory tracking process. Factors like product imports through barcodes, CSV files, and adaptability to diverse business requirements are crucial in making an informed choice.

In the final analysis, the choice of inventory management software depends on the business’s unique requirements, whether it’s a warehouse operation, a small to medium-sized enterprise, or an individually owned business. The right software simplifies inventory management and becomes a strategic asset in driving business success and growth.

About Complete Controller® – America’s Bookkeeping Experts Complete Controller is the Nation’s Leader in virtual bookkeeping, providing service to businesses and households alike. Utilizing Complete Controller’s technology, clients gain access to a cloud platform where their QuickBooks™️ file, critical financial documents, and back-office tools are hosted in an efficient SSO environment. Complete Controller’s team of certified US-based accounting professionals provide bookkeeping, record storage, performance reporting, and controller services including training, cash-flow management, budgeting and forecasting, process and controls advisement, and bill-pay. With flat-rate service plans, Complete Controller is the most cost-effective expert accounting solution for business, family-office, trusts, and households of any size or complexity.

What is the one entity that stops many potential entrepreneurs from chasing their dreams? The definite answer is MONEY. Not everyone can secure a business loan or want to put their possessions on the line. And the majority of startups never obtain a dime from Venture Capitalists (VCs). Visions die daily because of insufficient bookkeeping, resources, and funds. The money that goes into startups has risen in the last few years. In 2013, VCs financed nearly $11 billion in seed and early-stage companies, up more than 17 percent from 2012. While less than 1 percent of all startups formed each year strike a VC deal, funding is an influential reserve for the businesses that receive it and an indicator of significant technology trends.

For each phase of your company’s life, financial necessities may need outside funding. The kinds of funding for the different stages are entitled:

Stage 1: Seed Capital

The descriptor “seed” fits here since it proposes money to fuel a startup’s growth. The front-runners of a startup may not have any commercially available merchandise yet and are, instead, most likely absorbed in convincing stockholders why their ideas are worthy of support. Seed funding rounds are classically smaller and directed toward the initial product’s research and development. The money may also be used for directing market research or expanding the team.

Stage 2: Startup Capital

This phase is like the seed stage. With initial market analysis conducted and business policies in place, businesses look to publicize and advertise the invention and attain customers. Establishments at this phase likely have at least a tester product available. VC funding may be diverted to getting more management personnel, fine-tuning the product/service, or conducting additional research.

Stage 3: Early/First/Second Stage Capital

Sometimes called “the first stage,” this phase only arises after the seed and startup stages in most circumstances. Funding expected at this stage will often go toward engineering and production facilities, sales, and advertising.

The sum capitalized here may be considerably higher than during the prior stages. At this point, the business may be moving towards cost-effectiveness as it pushes its products and advertisements to a broader audience.

Stage 4: Expansion/Second/Third Stage Capital

Growth is often exponential by this phase. Therefore, VC funding aids as more fuel for the fire, enabling development to additional markets (e.g., other cities or countries) and diversification and differentiation of product lines. With a commercially available artifact, a startup at this stage should be taking in ample income, if not profit. Many businesses that get extension funding have been in business for two to three years.

Stage 5: Mezzanine/Bridge/Pre-Public Stage

After reaching this stage, the business may be looking to go public, given that its products and services have found suitable traction. Assets received here can be used for activities such as:

1.   Mergers and attainments
2.   Price diminutions/Other measures to drive out opponents
3.   Financing the steps toward an initial public proposing

If all goes well, stockholders may sell their shares and end their engagement with the company, having made a healthy return. These five stages are the most important; the other five stages needed for startup include everything from systematic bookkeeping to the business’s maintenance.

Final Note

Ensure you allow enough money for the true expenditures associated with running your business for the first year of operation. Ensure you’ve planned for more workforces, increased production, more stuff for new personnel, etc. One of the top causes many new businesses fail is because they don’t get enough startup capital. Convincingly estimate your financial needs and leave room for the unexpected, or you may be out of business unpredictably. So, now you know about different financing for different phases of the corporation’s growth and maybe know how much investment you need.

About Complete Controller® – America’s Bookkeeping Experts Complete Controller is the Nation’s Leader in virtual bookkeeping, providing service to businesses and households alike. Utilizing Complete Controller’s technology, clients gain access to a cloud platform where their QuickBooks™️ file, critical financial documents, and back-office tools are hosted in an efficient SSO environment. Complete Controller’s team of certified US-based accounting professionals provide bookkeeping, record storage, performance reporting, and controller services including training, cash-flow management, budgeting and forecasting, process and controls advisement, and bill-pay. With flat-rate service plans, Complete Controller is the most cost-effective expert accounting solution for business, family-office, trusts, and households of any size or complexity.

Bookkeepers help businesses with day-to-day accounting, recording essential worthwhile business transactions. In short, influential people are assigned the most important task: record, maintain, and update business transactions as they develop. But is this evidence sufficient to hire a bookkeeper?

A Bookkeeper is an Invaluable Asset

There is no denying that bookkeepers are an invaluable asset for a business. Large-scale businesses with an enormous amount of daily transactions hire multiple bookkeepers who track and record every business transaction happening throughout the day. The synergy between all bookkeepers working for a single firm must be present to achieve high business efficiency and productivity. Small entrepreneurial ventures may cater to their daily bookkeeping needs with software or spreadsheets. Still, when the business grows, the bookkeeping needs also grow, which means it’s time to hire a bookkeeper.

When to Hire a Bookkeeper

The right time to invest in hiring a professional bookkeeper depends on multiple factors; when you find it hard to spare time for bookkeeping day-to-day business transactions, the size of the business grows, the frequency of business transactions increases, reconciliation of records becomes a mess, there are a lot of discrepancies in records, and certainly, when the need for a professional bookkeeper becomes evident. Gone are the days when you had the option to delay your bookkeeping activities for a couple of days or even a week as the frequency of transactions was low. Now, you can never even think of delaying bookkeeping activities at all. Why? Because it will lead to disaster.

Choose Someone who will Deliver Optimal Results.

To hire a bookkeeper, you need to search for viable options, those you see the potential in to deliver the best results. Since the entire business depends on accurate bookkeeping records, you need to make sure that you hire the most suitable person for your daily tasks. Although DIY bookkeeping software is a cost-effective solution that can help deliver desired results, most business owners are still not the ideal choice. Investing in a bookkeeper is the right strategic choice since it can provide clear insight for wise decision-making and future planning.

What Do Bookkeepers Do?

In short, when you should hire a bookkeeper can be answered with a well-acclaimed thought: ‘The sooner, the better. It’s a wise idea to hire a bookkeeper to handle core business responsibilities such as recording daily, weekly, and monthly sales, invoices received from vendors, invoices sent to customers, expense receipts, and wages for payroll. When a business grows, you are likely to require the services of professional bookkeepers who, besides recording and categorizing every business transaction, will also reconcile the books at the end of each working day. The best thing about professional bookkeepers is that they know the art of creating and maintaining a healthy financial life cycle.

Investing in a Bookkeeper Pays Off

Future predictions and strategies will be based on bookkeeping records—the more accurate they are, the healthier the results will be. To make the right decisions for your firm, hire a bookkeeper to ensure your company’s growth and success with their knowledge, skills, and experience.

Hiring a professional bookkeeper doesn’t have to come at a high price. Professional bookkeeping services are only believed to be pricey, but they are not. All you need to do is make the right choice that fits your business needs and requirements, and the results will prove significant. Whatever you invest in, hiring a bookkeeper will pay you off in the long run, time and time again.

About Complete Controller® – America’s Bookkeeping Experts Complete Controller is the Nation’s Leader in virtual bookkeeping, providing service to businesses and households alike. Utilizing Complete Controller’s technology, clients gain access to a cloud platform where their QuickBooks™️ file, critical financial documents, and back-office tools are hosted in an efficient SSO environment. Complete Controller’s team of certified US-based accounting professionals provide bookkeeping, record storage, performance reporting, and controller services including training, cash-flow management, budgeting and forecasting, process and controls advisement, and bill-pay. With flat-rate service plans, Complete Controller is the most cost-effective expert accounting solution for business, family-office, trusts, and households of any size or complexity.:

A budget can be a challenge for new and small business owners. It is a critical part of any business, whether small or large. In the budget, plans on how much will be spent on each business operation, when to spend, and when to save are all laid out meticulously. New small business owners often make a few crucial mistakes while budgeting due to a lack of experience. These mistakes can be avoided by research and taking advice. Most importantly, when there is a budgeting mistake, it must be corrected appropriately.

It is essential to identify all small or large expenses and insert them into the budget. If you fail to estimate all expenses, you may be left with no money at the end of the month to pay for debts and other expenses.

No Business Plan or Strategy

New small business owners often don’t have experience with precise budgeting and running a business. They often make the budget without a strategy and solid business plan. Small and long-term financial plans are a crucial part of a budget. New small business owners are often just so excited to jump into their start-up without a detailed business plan and goals. If you want success, you must plan for it.

Selling at Low Prices

Once a new small business owner enters the market, they are often enticed to sell their product or service less than their competitors. This strategy is adopted to attract customers, and it makes sense. But in theory, you are losing your money. Remember, Less is the profit margin. More is the loss. To compensate for this loss, sometimes they decrease the operating expenses for producing the low-quality product. Remember, the customer is not likely to purchase it if it is of poor quality. Again, you are at a loss.

Under-pricing cannot be a solution to enhance sales.

Spending More than the Projected Budget

The initial few years of start-ups are very crucial for business success. The mistake often seen is that new small business owners start overspending when revenues start receiving. The most common budgeting mistake is that they overspend on advertising. A common assumption about advertising is that it will immediately enhance sales. At least a quarter is needed to see the impact of advertising on sales. Overestimation of revenue leads to a glaring budget deficit.

Our budget is unhealthy when we do not track our expenditures by bookkeeping or any accounting software. When we do not identify what we have spent, we cannot determine when we have reached our limit. Once we track our spending, we can start following our budget as planned.

Underestimating Uncle Sam

Every business has to pay a heavy amount to the government through taxes. There’s no getting around that one. If you underestimate the amount of taxes you are liable to pay, it will affect your budget drastically.

When making your budget, sit with your last year’s bookkeeping record to know all the details of the transactions. Your bookkeeper will tell you the exact amount of taxes you paid last year. Considering this data, estimate the exact amount of taxes you will owe for this year.

Many business owners often underestimate taxes, which leads to budget failure. Overestimation of taxes is much better than underestimation.

Loss of Revenue Due to Mismanagement

A small business owner has a busy schedule, no doubt. They have a long list of things they need to accomplish each day. Unfortunately, many fail to manage and organize their business cycle optimally. This disorganization can lead to extra expenses and a lower profit margin.

Your cash flow is an indicator of a healthy business. It should be considered if your cash flow is poor and you have many pending payments. Poor cash flow indicates that money coming in payments and profits is less than money going out. Money going out is in operating costs, marketing, and advertising campaigns.

Conclusion

Budgeting mistakes can be avoided by following the plans mentioned above. A proper budget is key to business success, and proper planning is key to a solid budget.

About Complete Controller® – America’s Bookkeeping Experts Complete Controller is the Nation’s Leader in virtual bookkeeping, providing service to businesses and households alike. Utilizing Complete Controller’s technology, clients gain access to a cloud platform where their QuickBooks™️ file, critical financial documents, and back-office tools are hosted in an efficient SSO environment. Complete Controller’s team of certified US-based accounting professionals provide bookkeeping, record storage, performance reporting, and controller services including training, cash-flow management, budgeting and forecasting, process and controls advisement, and bill-pay. With flat-rate service plans, Complete Controller is the most cost-effective expert accounting solution for business, family-office, trusts, and households of any size or complexity.