Sales Tracking and How it Can Benefit
When tracking sales, it is super beneficial to pay attention to details. If you keep a close eye- you can make your business work for you! Putting in the time and effort (or letting someone else put in the time and effort...ahem...me) you can spot sales trends, budget so much easier, and expect the unexpected.
Let's start with the basics, tracking sales goes hand in hand with tracking inventory. If you sell an actual product, you need to keep track of how much you buy/make, then tracking how much/many you sell. That is the basic point of inventory, right? Tracking sales keeps inventory in check so you know how much product to order, what is running low, what isn't moving, etc.
This is pretty basic for operating any business that sells a product. Whether you make the product or buy and resell, inventory helps you know what you have on hand. When tracking sales, you keep inventory in order, which keeps the ship running smoothly.
Every small business has a budget. You have x amount of dollars to spend weekly/monthly and you need to sell x amount of dollars to stay out of the red. Gasp! Do not speak of such things! I know, the red is a terrible place to be. But add to that all the monthly expenses not pertaining to the product; utilities, rent, etc. Then the budget starts to be a little more difficult to nail down. After being in business for over a year, however, this becomes a lot easier to know the exact dollar amounts almost everything should be and budgeting becomes a breeze.
Starting a new business can get a bit overwhelming when not being able to anticipate your budget. While you might have a loan or financial backing partner (phew! that takes some stress away, doesn't it?), that is not always the case for small businesses and they have to grow from scratch. Businesses built from scratch have a bit more work to do but it is do-able. The same premise applies to both, with more or less variables depending on how your businesses is financially funded.
Food and Drink establishments (restaurants, bars, coffee shops, etc) are one of the most risky ventures in business because the profit lines run very small- especially within the first few years of opening. This is one of the first conversations I like to have with new clients, especially those in this field, to make sure we are getting everything on track and set up for success. We will go over monthly expenses, payment types, averages sales per ticket, etc. Once I am able to start financial reports for your business, we can set up a budget and even see if there is any room to save money. Those financial reports, including the budget, can be done and sent by us weekly, monthly, or Quarterly- I absolutely suggest financial reports when working with us-they are easy to read and help you understand your business so much better.
I believe this is one of the most important results of tracking sales. Predicting sales is so beneficial, let me count the ways! Not literally, but I will go over them.
Let's say you have a little shop that offers massage therapy, everyone loves a good massage! Do you have an appointment for tomorrow? I could use one! Anyway, you have been tracking your sales and have noticed some reoccurring patterns. You sell a lot of gift cards in November and December, the mornings seem slow, 12pm through 2pm are booked solid most days, and sales taper off toward the end of the day. But what does that all mean?
It means that a lot of people give massages as stocking stuffers for Christmas- so expect a larger cash flow in those months with more appointments coming in at the beginning of the year without a lot of cash flow. But because you budgeted, you knew to save some of that Christmas cash flow for the first few months to pay those employees! It means that you know how to create a successful schedule so you have the right amount of employees in the morning, lunch time, and end of day.
Predicting sales helps you budget and inventory, as well as scheduling employees appropriately, and so much more-it's the backbone to any business running smoothly.
If you are able to set aside several hours a week for this, that is fantastic! If you do not have that kind of time, which a lot of business owners do not- especially if they want to have an active role in daily operations, we are more than happy to sit down and discuss all this in person. Whichever your choice, remember that sales tracking should be a staple in how your business is run.