We know what your accounting clients are doing this weekend (at least the ones in retail). Since we’re only hours away from one of the biggest shopping extravaganzas of the year, we’re pretty sure your clients will spend the weekend serving customers and filling orders.
Black Friday and Cyber Monday (with Small Business Saturday wedged in between) are two of the most important dates for retail. Last year, shoppers spent a whopping $682 billion over the course of Black Friday weekend.
Accounting is not something retailers can ignore (or do the wrong way) for months. Especially when the winter holidays is closely followed by another, albeit somewhat less beloved time of year: tax season.
With numbers like that, it’s no wonder if your clients can’t concentrate on accounting right now. However, one small mistake could cause an avalanche of problems further down the road, which is why your clients need your help right now, even if they don’t know it.
Especially since retailers can’t relax when Cyber Monday’s over, as the winter holiday shopping season has just began.
But accounting is not something retailers can ignore (or do the wrong way) for months. Especially when the winter holidays is closely followed by another, albeit somewhat less beloved time of year: tax season.
With your clients up to their elbows in sales receipts, it’s your task to help them deal with all the accounting issues brought on by Cyber Monday and the Christmas shopping season.
Accounting for Sales Discounts
Cyber Monday is known for its online sales discounts (otherwise it would be called Any Other Monday). Do your clients know how to record sales discounts in their books?
Contrary to popular belief, sales discounts can’t be reported as expenses. Instead, they are a reduction of gross sales. The equation goes like this:
Net Sales = Gross Sales – Sales Discounts – Returns
While it’s not rocket science, business owners may not be aware of this at first and record all their discounts as expenses. Educating your clients about the correct way to record their discounts could save them from wasting their time and efforts on something they’ll have to do all over again.
Keeping Regular Records
Unfortunately, there’s no way around this one. Even though your retailer clients are most likely busy beyond measure at this time of year, bills, expenses, and invoices won’t just magically sort themselves out.
Educating your clients about the correct way to record their discounts could save them from wasting their time and efforts on something they’ll have to do all over again.
Encourage your clients to dedicate a small part of each business day to deal with accounting issues. Alternatively, they may allocate a bit more time every other day, or half a day every week. The key is that they regularly address their accounting needs (no, once a year is not regular enough) and don’t let bills accumulate.
Accounting software can be a big help with that. Platforms like QuickBooks and Xero can assist your clients to deal with tracking expenses, managing cash flow, paying invoices, and requesting payments from business partners.
Automating accounting this way is a big incentive for clients who lack the time, skills, or affinity to regularly address their accounting issues.
Give your clients a call and find out if they need any help in preparation of skyrocketing Cyber Monday sales.
They’ll appreciate the gesture, and you can rest assured you won’t get panicked phone calls from them once they realize the mistakes they made when recording their Cyber Monday discounts.