02 Aug How To Use Bookkeeping Trends To Grow
Using data trends is nothing new. In fact, data science is one of the fastest growing fields of study and employment in the world. This is because we have access to 2 things that we didn’t have before: massive amounts of data and rapid computer processing power. By leveraging these 2 things, your bookkeeping can go from a necessary chore to the most impactful research division in your company. Financial trend analysis can be the missing link in your business success.
Here are three ways that financial trend analysis can help grow your business:
#1 – Financial trend analysis can discover ways to save money
Odds are you’ve been keeping your financial books for years. In fact, you probably have every financial record since the beginning of your business. This could be your business’ most valuable asset. By applying some simple trend and data analysis algorithms, you could discover ways to save both time and money.
Examples of ways you could be saving money include the following: adjusting your hours of operation, predicting shipping schedules, anticipating recurring ordering, or even re-evaluating your available products. By exploring the available data, you will very quickly and easily discover these opportunities.
#2 – Financial Trend Analysis can uncover lost funds
Business can get hectic. With so many bills and invoices going in and out of your business, it’s not unreasonable to miss a thing or two. When you have a strong trend analysis review, you may be able to find gaps in your payments and invoices and recover those lost funds.
By combining this basic trend analysis with your bank reconciliation practice, you can find out if there are invoices that you’re still waiting to receive. One great feature is that you can see if there is a standard payment trend for each of your customers. Also, you can discover customers who may not be paying or paying the incorrect amount. Even more interesting, is that you might be paying too much money to some of your vendors.
#3 – Financial trend analysis can validate your spending
It is highly likely that your business is spending money on different initiatives, product developments, or opportunities that may or may not be yielding results. Financial trend analysis will give insight into each of these and how they’re impacting your bottom line.
One of the more notable features of performing financial trend analysis is being able to compare data points that may appear unrelated. However, significant trends may be discovered by comparing these disparate data elements. This can lead to more effective or surgically targeted spending.
By using the tools and data you have on hand, you are leveraging all available assets in pursuit of the growth of your business. A good contractor wouldn’t let extra lumber go to waste. The same goes for a business owner. You must use every available item in your arsenal to improve your business. When financial trend analysis becomes too much of a time cost for you, you can outsource this service to a bookkeeper or accounting staff. These teams are specifically built to be effective time managers and bring usable impactful data for the growth of your business. If you want to know more about outsourcing your financial trend analysis, contact Steph’s Books and discover new ways that your business can grow.