If there is one thing that every entrepreneur seems to hate doing, that is keeping the books up-to-date. Most people go into business because they are good at something, rarely at bookkeeping. Yet they must be kept, and an accurate bookkeeping system can be an extremely valuable asset. Some claim that poor record keeping has destroyed more small businesses than inferior products or marketing mistakes - as much as 80% of failures correlate closely with poor bookkeeping. Good bookkeeping should be able to instantly tell you:
* How much do I owe my creditors?
* How much am I owed?
* What is my investment in equipment?
* What is my investment in inventory?
* What is the aging on my accounts?
* How can I improve my cash flow?
* How often does my inventory turn over?
* What must I make daily to break even?
There are computer programs available to help you do the bookkeeping, and you could even do it manually on your own. The problem is that entrepreneurs seldom make good bookkeepers. The average entrepreneur deals in ideas, charging ahead at the "big idea" with little regard for details. Their desks often look like disaster zones. Those who make good bookkeepers tend to be those who are meticulous, detail oriented and very organized. The ideal business has both the entrepreneur and bookkeeper working together. No computer program will change your personality. If it is easy to put off updating every item in a manual system, you are unlikely to do better on a computer. This is where a professional bookkeeper or accountant can be a key part of your business success. Even if you decide to do it yourself, having a professional set up your books the first time will save you endless trouble later.