How your Salon Accountant should be helping you

salon acounting
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Having a degree in Banking and Finance still doesn’t mean I do the Salon Accounting in my own Salon. I have been a Hairdresser and a Salon Owner for quite a while, but I really believe in delegating to an expert. 

As well as being a salon coach and mentor you’ll appreciate, I’m sure, that managing my salon business is a handful.  And staying on top of the numbers is hard work too.  But, of course, essential.  My advice is “don’t stay on top of it without professional help!”

Find someone who knows what they are doing, an expert in their field. Ideally you need to find someone who can do all three for you:

  • Bookkeeping – monitoring and keeping of invoices and receipts/day to day running of your business

This is where I see most salon owners wasting their time.  A good bookkeeper will have an hourly rate far below what you could be earning in your salon business.  I’ve said it again and again: you can’t be a £1000 an hour business owner doing £25 an hour jobs.

Usually an accounting firm will charge more than a freelance bookkeeper – if you’re going down the freelance route, find someone who can integrate their systems easily with your accountant.  The best way, I’ve found, is to ask your accountant for the recommendation – they normally have a few they have worked with successfully before.

  • Management Accounting – submit returns, forecasting and giving financial planning input

The difference between ‘accounting’ and ‘management accounting’ is enormous.  You need proper, regular performance reports for your business.  A regular accountant won’t do that for you – a management accountant will relish it!

  • Payroll

Three big wins in your salon accounting relationship:

1.  Plan – I make sure that I sit down with my accountant and we brainstorm what I want my business to achieve in the next 12 months or so. Your goals and vision for your business are important in the planning process. If your accountant is someone who is not willing to help you out in the planning process, it’s time that you find another one. They can help you understand if you are growing your business or if you are in a not so good financial situation.

2.  Report – I meet my accountant once a month for the management report that I need. But you could meet your accountant every 2 months or so. Never accept just an end of year report from your accountant. If you have that kind of accountant, you know what to do. Understanding the reports and your financial situation will be a massive help to you as a Salon owner in your decision making.

3.  Automate – It is a hassle having your accountant chase you because you have that missing piece so she can complete her report. I’ve discovered that hassle-free way of having my accountant finish her report without the need to always chase me.

  • I’ve scheduled to have my POS System send her an end-of-month report automatically
  • Bank statements are automatically sent out to her
  • Expenses report are sent out to her via an app that we downloaded (Pikki). So I can just throw out the receipt.

Where to find an Accountant?

Paying an accountant for their services should be worth it.  So make sure that you get the most out of them.  Time and again I hear “My accountant doesn’t do anything for us apart from returns”, yet when I probe a little deeper, I find the accountant hasn’t actually been asked for anything more!

Keep pushing for timely, relevant information that helps you run your business, that is presented in a way you understand.  And if you hit a brick wall, it is probably time to shop around for new help.

Remember that your Accountant should be your best ally!  The best way to find one is by referral. That way, you know that their service has already been tested and is recommended.  Shop around.  A variety of candidates is ideal and will allow you to choose the best fit.  Take your time making your decision and make sure that you are choosing someone who understands your business, your plan and someone who you can get along with for a number of years.

 


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