We recently joined the thousands of businesses headed to the Xero Roadshow, an annual exploration of what’s happening in the world of cloud accounting. Much more than just a showcase of Xero’s features, the Roadshow is one of the best ways to learn about the ecosystem.
It’s also an opportunity to meet and make friends with Xero Partners and customers, which is exactly what we did. One of the people we were fortunate to meet is Xero expert and Xero For Dummies author Heather Smith, who was happy to talk to us about some of the problems retailers are facing and the role of cloud platforms in solving them. Here’s what she had to say:
Q. What Are the Most Common Mistakes You See Small Retailers Making, and What Steps Can They Take to Avoid Them?
For some retailers, the bottleneck in their business is at the point of sale. The process of receiving money from clients needs to be as frictionless as possible. Ensure that your POS system is properly set up and integrated with your accounts system, that your staff are trained in how to use it, that there are enough staff available on the floor during busy periods, and that there are contingency plans in place if, heaven forbid, you lose electricity. Importing from overseas is an exciting element of operating a retail business, but it needs to be accounted for correctly. A frightening mistake I see retailers make is clumsily dealing with GST on imported goods. Incorrectly coding the customs agent’s documentation can lead to massively under-claiming GST. Avoid this by developing internal support notes on how this should be handled with an experienced BAS Agent—it will save you cash flow headaches. However, it’s good to know that if you have made an error, the figures can be reviewed, and an adjusted BAS submitted to the ATO so the GST can be claimed back. But it’s better to get it right in the first place!
Q. What’s a Feature of Xero (or Cloud-Based Accounting in General) That You Don’t Think Enough Business Owners Are Taking Advantage Of?
With timely, accurate data available, business owners should take advantage of the dashboards and reports within online accounting solutions. Interactive Profit and Loss reports give you visibility over expenses in the business, so you are better placed to trim unwanted costs. With permission, simultaneous access means all managers get an uninterrupted view of sales data so they can proactively take advantage of opportunities, and swiftly deal with issues as they arise, without necessarily being in the store.
Xero has inbuilt storage facilities, so all relevant accounting documentation can be uploaded into Xero, and stored in online files or tagged to relevant transactions. As well as moving you towards a paperless office, this ensures your transactions are supported by data, so your accountant and the ATO are happy that everything can be sourced quickly.
Online accounting solutions also offer a range of compliance features to make it easy for retailers to meet their regulatory requirements, such as integrated BAS, Tax File Declarations and Payment Summaries for seamless submission to the ATO.
Q. How Important Is Good Inventory Management for Retailers, and What’s the Best Way to Achieve It?
Inventory management can be a complex beast, and it’s definitely not something you should be trying to do in your head. It’s essential that retailers have the right stock available so they can get customers to open up their wallets and part with cash. An inventory management solution helps you monitor and understand stock movements and requirements to minimise storage expense and cash flow issues. It’s only with a clear understanding of quantities on hand and quantities available that you can plan to venture out into additional bricks and mortar locations or an online presence, and grow your business.
Q. As Retailers Grow, Do You Think It’s a Good Idea to Be Managing Inventory Only Within Their Accounting Platform?
In many cases, the answer would be no. Inbuilt inventory within online accounting solutions is typically a simple inventory solution. It may suffice in the early days, but as your business grows, will it be able to grow with you?
Retailers need to assess the complexity of their inventory situation. For instance, how much stock do you have? What value is it? Does it expire? Is it stored at different locations? Use these and other parameters to identify an inventory management solution that can help you grow, to the business you want to be in five years time.
Q. What Was Your Key Takeaway From the Xero Roadshow?
The Xero roadshow is typically held at the start of the year, and it was explained to me that its purpose is not to introduce anything new, but to expand in detail on announcements made at Xerocon. I was fully aware of most of the features presented on stage, as I had written about them in the third edition of Xero for Dummies.
My key takeaway was an awareness of how Xero is pushing ahead, giving accountants greater access to the data they need to accurately advise clients on their performance and opportunities.
Neto is a leading retail platform designed to help you sell products across multiple channels. With inbuilt inventory management and native integration to accounting platforms and payment gateways, our powerful back-office capabilities take care of the details, so you can concentrate on the big picture. Keen to know more? Find out how inventory management can improve your bottom line. If you’re an accountant, Neto is a great way to help your customers’ scale their business.