Bookkeeping Basics, New Boutiques
Understanding the Boutique Bookkeeping Basics
Whether you’re just starting out or looking to gain a better understanding of your boutique finances, this blog post is your ultimate guide to mastering the art of bookkeeping for your boutique business.
You’ve got racks and shelves of stylish clothing and accessories, and a boutique (whether it’s a brick and mortar, online only, mobile boutique or pop up shop) that’s an absolute dream come true.
But here’s the thing – running a boutique isn’t ALL about fashion and flair. One of the most important tasks you need to ensure you’re staying on top of in ANY business is the bookkeeping.
Now, I know that’s not everyone’s favorite topic. Fortunately, it’s mine! So, I’m here to help you eliminate the anxiety & confusion you feel anytime that word comes up, and help you feel just a LITTLE more confident when it comes to understanding the numbers.
Bookkeeping is simply the process of organizing all the money moving in and out of your business. There’s no need to over complicate it. You just need some type of a system in place to keep it all organized.
Why is Bookkeeping Important?
I’m sure you’ve heard that you NEED to do bookkeeping, but why does it matter so much? There are 3 primary reasons:
- Financial Clarity: Bookkeeping helps you understand how much money you’re making, where it’s coming from, and where it’s going. This information can help you make better business decisions.
- You Need It For Taxes: No doubt, this is the most common reason boutique owners think about. Having organized bookkeeping throughout the year will make your tax filing process SO much simpler and stress-free.
- To Know How Much to SAVE for Taxes: Having a clear idea of what your total income & expenses are helps you see how much profit you’re making. Your profit is what you will be taxed on at the end of the year. You can work with a tax preparer to determine how much of that profit you should be setting aside each month/quarter, but I generally recommend saving 30% of your profit for taxes.
- Spotting Trends:Bookkeeping can allow you to identify trends in your boutique’s sales and expenses, helping you budget for the future and make adjustments as needed.
Getting Started with Bookkeeping:
- Separate Personal and Business Finances: Open a separate bank and credit card account for your boutique so you can keep it completely separate from all your personal money. This separation makes it easier to track and manage your business money.
- Choose a Bookkeeping System: There are options for every budget! My personal favorite isQuickbooks Online, but if you can’t quite justify the cost, you could get by with a simple spreadsheet or a free software likeWave. Just keep in mind that you’ll likely want to upgrade to a paid software as you get more activity in your business to make your life easier.
- Record Every Dollar: Every purchase, sale, and expense must be recorded. This includes buying inventory, making sales, paying rent, and even those cute new boutique window displays. Every dollar that flows in and out of those business accounts must be recorded.
- Reconcile Regularly:Every month, you should be reconciling, or matching, your bank and credit card statements with your bookkeeping records to catch any discrepancies. This will help ensure that you don’t accidentally record something twice, or miss something.
- Stay Organized:Keep all your receipts, invoices, and financial documents in an organized system. This will save you time and headaches later. You can use a physical filing cabinet, an organized Google Drive system, or a software such asHubdoc.
Bookkeeping might be confusing, but I’m here to help you make sense of it all! Just like any business skill, it takes a little practice, but once you get the hang of it, that confusion will be replaced with confidence!
If you’re ever feeling overwhelmed, don’t hesitate to reach out! You can find me on Instagram at@findingfreedomfinancial
Here’s to finding your own version of freedom!
Hi, I'm Megan!
Bookkeeping for the retail industry has some unique complexities that take extra time to manage to ensure accuracy. At Finding Freedom Financial Services, I provide done-for-you bookkeeping services for boutique owners that accurately track these complexities for you so you can have more time and focused energy to dedicate to running your stores. If you’re ready to get your time back, apply to work with me today!
