What do you want the bookkeeping system for your handmade business to tell you?
Oh sorry, didn’t mean to put you on the spot like that – I know it’s a really personal question.
Maybe it’s a question no one has ever asked you or something you’ve never even thought about.
I mean, seriously, how many handmade or creative business owners really stop and think about bookkeeping? Sure, we all know it’s something we HAVE to do – and man do we dread it!
But now that I’ve asked the question about “what do you want the bookkeeping system for your handmade or creative business to tell you” – and opened that whole proverbial can of worms…….
Everyone is going to have different things that they want to track, depending on what type of handmade or creative business they have.
Where you are in the business process also plays a key factor – your needs will be much simpler just starting out. But as your business grows you may find that you want or need to know (and track) more information.
Some people are going to go the absolute bare bones route. Just tracking total income and expenses for the year in a spreadsheet, because that’s all you have time for or think you need to know. Maybe you’ll dump all the receipts into a box or a folder, rely on sales reports from PayPal, Square, Etsy, Ravelry, etc., and do your books at the end of the year – when you have to.
Others may want to split out income by revenue stream. So, perhaps you have a spreadsheet showing totals by revenue stream and totals for expenses by quarter. (When I say “revenue stream”, I mean the various places you sell.) Maybe doing a whole lot of other things (haphazardly) in various spreadsheets or other systems (when the feeling, time, or inclination arises). Because you think real bookkeeping or accounting software would be too hard to learn or couldn’t track the specifics that you want.
There may be others who want to see a month by month comparison. So, your spreadsheet will have columns for each months totals.
As your business grows, you might want the bookkeeping system for your handmade business to tell you.
- The cost of each finished item that you sell.
- What was your best selling finished item or pattern this year.
- Which craft fair brought in the most money this year.
- If you do the same craft fair every year, how much money did it bring in each year and in total.
- How much each Affiliate program or Ad Network that you’ve joined brought it each month, in total for the year, and over all the time you’ve been a member.
- The amount of money you’ve paid in commissions to a specific shop where you sell your finished items – this year, compared to last year, since you started selling there.
- How much money you’ve paid your Tech Editor for a specific pattern, this month vs. last month, this year vs. last year.
These are just a few of the things that you might want your bookkeeping system to tell you.
Can you track all of this using spreadsheets? Sure, but bookkeeping using spreadsheets can get mighty messy and require more spreadsheets than you want to deal with.
Real bookkeeping & accounting software can provide you with these answers (and more) by simply clicking a couple of buttons and running a report. How sweet is that?
What do you want your bookkeeping system to tell you? Drop your answer in the comments below.