Retail businesses today rely on accounting software tools more than ever before. There are many options available to those in retail but which of these will best suit the needs of your business?
Retail accounting software is a vital part of a larger business information system. It helps retail businesses track purchases, inventory, customers, cash flow, staffing, and much more. For any retail business to succeed, their software systems must be up to the task.
Using their extensive industry experience and knowledge of various systems, the BDO Wellington team have outlined some useful tips below to help you choose the best retail accounting software for your business.
Essential retail accounting software functions
There are several things to consider when choosing the best accounting software package for your retail business. First and foremost, your chosen software solution should be designed specifically with retail applications in mind. It should also ideally have multiple access levels, as this will enable you to engage your staff with the system without revealing full business information, and from that it can further unlock business management efficiencies. Check for any available add-on functions as well. Most accounting software handles transactions, but you may also want a payroll or inventory management function for a more comprehensive package.
Finally, cloud-based solutions are more practical today, simply because you may want to access information remotely. Make sure the platform is both scalable and extensible. You should be free to add new features to the software through add-on apps as your business requirements develop. Generally, cloud-based solutions should integrate together to automate processes and save time (for example, staff wages and PAYE from the payroll system should feed into the accounting system, or, the point-of-sale system should link with inventory to automate stock level management).
The retail accounting software you choose for your online or brick-and-mortar business should come with an inventory management function. There is nothing worse than running out of popular stock items. Ideally, this should be an integrated solution that also includes sales and purchasing functionality.
It is also useful if your software can tell you the cost of goods sold, the profitability of each product sold, how long inventory sits on shelves before it is sold, your entire inventory turnover rate, as well as shrinkage due to theft or damage.
Remember, properly managed inventory will protect your gross profit and help protect your bottom line. Having good software means you’ll be able to make decisions at the right times and ensure your inventory doesn’t get out of control.
A good POS system will handle most of the functions crucial to a retail store’s operation. It should also work in tandem with your retail accounting software to provide the information you need to update your accounts. Ideally, it will also provide details on staff performance in sales, which you can use as a measure for staff management and incentives.
If you’re an online retailer, your software won’t require functions such as cash registers or a barcode scanner, but it will require components such as an online shopping cart and payments options, and perhaps real-time inventory tracking software.
BDO’s retail software capabilities
Our retail advisory offering services both brick-and-mortar and online businesses across all retail sectors and in both the franchise and non-franchise space. We provide valuable insight on which retail software technologies will work best for your business and achieve your business goals, providing expertise across all leading systems, from Xero and MYOB with their associated apps and add-ons such as Vend, , to bigger systems like SAP and Microsoft Navision. Our local advisory teams can draw upon additional software expertise and experience thanks to our powerful global network.
We will help you get the most out of your accounting software and your business by reading between the lines of your data. This will include considering product margins, mapping key customer traffic touchpoints, and using your POS system to track sales staff performance and commission structures. Our data gathering and management consulting can also assist in identifying trends and acting on them, as well as understanding the effects of your marketing campaigns. Contact your local office today to discuss opportunities to improve your retail accounting software and in turn, your retail business.