A good accountant in your armoury is your business’ super power. An accountant should be able to do a whole lot more than bean-count and number-crunch, they should be able to add value to your business.
Time is of great importance and should be spent focussing on your business and using the individual skill-set that makes you unique. Your accountant should be like your number one fan club; do things well and they will cheer you on, do things badly and they will let you know about it. Your most prized professional relationship should be with your accountant. Leaving no skeleton in the closet, you should be able to bare it all; the good, bad and ugly, and they will help you make sense of it all.
You might want to use a bookkeeper to help you keep your records straight, however a accountant will be your own personal business advisor. They should spot trends in your business’s performance and methods and be able to give you constructive feedback on what’s working and what isn’t. They should be able to source other professional advice relevant to your industry. They may also be able to source funding or advise on better banking options. It will be money well spent!
You should ask your accountant about their experience, what they can bring to your business and how they can add value. Ask them for some case studies or to speak to one of their existing clients in a similar field to you. Treat it as an interview. After all, your accountant will become a big part of your life.
A client was referred to us by Natwest bank; she was a fashion designer and specialised in high end wedding dresses. She made dresses for celebrities and had an extremely good reputation. However her business was not making money and she couldn’t understand why. In addition to making dresses, she also offered sewing classes and fabric sales. Alongside her account preparation, we spent time understanding her business model, visiting her premises, looking at her products and attending her sewing classes.
As we started assembling the figures we realised that her most expensive products were turning the least amount of profit. In fact, you could argue that they were making a loss as they took so much of her time she was effectively earning less than minimum wage. After we analysed the figures we advised her to focus her energies on the fabric sales and the craft workshops. After another 12 months she was out of debt and turning a decent profit.
Insight: We find that most businesses are unsure how to cost out their overheads and set their pricing effectively. A good accountant will identify quickly if you need help in this area.