You have what you think is a great business. But you find it hard to track where the money is going. Perhaps, you need to get QuickBooks cleanup services available in places like McKinney, TX. You may be dealing with more problems than you can handle. Here are some ways your business is losing money and what you can do to fix that:
1. Poor pricing
You may be losing money because you are not pricing your products the right way. This could happen in two significant ways: you could be overpricing or underpricing your product.
A higher price is not always a bad thing. Some customers associate high rates with high quality. But there is a point when the value you charge for a product or service is not effective. For instance, your customers may not be convinced that they are getting their money’s worth. In that case, your business may not be making money because the number of customers you attract is much lower than your business needs to be sustainable.
You may also be underpricing your product. Perhaps you are afraid that your products or services may not attract customers if you increase the price. But the value you attach to what you sell may be too low to cover the costs of running a business. That means you will continue to operate at a loss so long as the price remains constant.
You need to learn how to price your products or services correctly. You must ensure the value you charge is more than the cost of running the business but not less than what your customers can afford or expect.
Your business could be a victim of fraud in more ways than one. You could be losing money to fraud that either your employees or customers committed. Your employees could be embezzling from you. They may be skimming your business funds or stealing money that you have already recorded in your accounting system. Statistics show that US businesses lose $50 billion a year to workplace crime, including fraud.
Your customers may also be using fraudulent means of payment that can cause your business to receive less money than they owe you. Some could be returning products dishonestly, thus forcing you to accept the losses. Maybe some of your employees are even cooperating with your customers to defraud you. They could be paying out funds for returned goods that do not qualify for refunds in the first place.
Once you determine that fraud is costing you money, you need to bring in an accounting expert. You may need to inform the police, as well.
3. Bad bookkeeping
Half of your business problems could probably be fixed if you kept good records of your business. You need to log all your transactions that take place. You also need to keep separate accounts for your business and personal needs. But that is not all. You must ensure that you invoice your customers and business partners on time and follow through until you get paid. Your business must be able to account for all invoices and receipts.
Hire a QuickBooks cleanup and other related services if you have a major bookkeeping problem. You will need all the help you can get to ensure your business records are up-to-date and in order.
Before you can fix your money loss problems, you must determine the cause. You need to start looking for all your business paperwork and digital records. The finance professionals that you hire will be able to fix your financial issues faster if you can provide them with the right documents.