Top 10 Signs that Your Clients have Outgrown their Accounting Software

As companies grow (in sales, market share, and new products/services), they’re often challenged by the ability of their IT systems to automatically capture, manage and report on accounting and operational information needed to make management decisions.

As their accounting services firm, you can easily tell when that happens.  Here are the top 10 signs that may indicate that your client has outgrown their accounting, ERP; business management system, and what you can do about it.

10. Their system can’t handle increased transaction volumes; their system slows down, and becomes cumbersome to use:

This can happen when your client outgrows their original accounting system (usually Sage 50, formaly Simply Accounting, Quickbooks, or something proprietary).  Make sure your client’s hardware is up to the task, and that their existing software is designed to handle an increased workload.

9. Not scalable to additional locations and/or warehouses:

Your client starts their business modestly, but then it takes off, requiring additional locations; maybe even additional warehouses.  Review your client’s profit/cost centre set up and/or their inventory management profile.  Then, help them set up their software to handle the new locations or warehouses in the accounting system.

8. Disconnection exists between sales and accounting:

Help your client create a direct data relationship between sales forecasting and budgeting, since this assists both: accounting, in cash flow management; and management, in business planning.  More and more businesses understand the benefits of using a Customer Relationship Management (CRM) system to track marketing and sales efforts, and then use that information in their accounting system for budget planning.

7. Customers and/or vendors require access to their system for placing orders and tracking purchases:

Most accounting systems either provide, or integrate with, eCommerce solutions that can deliver customer and vendor web portals.  Leveraging the power of these portals, your client will be able to reduce paperwork, and steps in the sales and purchasing processes; saving them money..

6. Managing and reporting data using a lot of spreadsheets:

This can lead to duplicate/triplicate entry and data-entry errors.  At the very least, ensure that your clients have rigorous procedures and secure templates in place for importing and exporting data in and out of their accounting system; including redundancy checks that prevent errors.  However, even then, without a tightly integrated ERP system (single database that supports all of the operational applications), there’s always a greater chance of data errors.

5. Can’t expand functionality to accommodate new operational needs:

Help your client to expand their software infrastructure to support operational activities like distribution, manufacturing, logistics, professional services, project accounting, and much more.  Most accounting systems have the ability to do this.

4. Management reporting limited to income statement and a balance sheet:

Support your clients to see more into their business activities; control costs, increase revenues and improve operational efficiencies.  Help them implement a system that delivers management dashboard, and KPIs (Key Performance Indicators) based on real-time information to help them better manage their company.

3. Can’t automate business processes in the system:

Encourage your clients to see the benefits of improving operational efficiencies by implementing controlled business processes in their accounting/business management system.  Encourage them to implement industry best practices.

2. Can’t handle multi-currency or multi-lingual requirements.

Multi-currency or multi-lingual functionality in accounting systems is becoming more and more crucial for companies these days, as the world economy continues to integrate.  Many accounting software systems have the functionality to support this and easily help your client get up & running with multiple currencies, as well as understand the accounting & tax implications.

The number one reason why your client may have outgrown their accounting, ERP; business management system…

1. Your client sends their receipts to you in a shoebox…

What a conundrum!  Means more billings for you, but might be what keeps your client from gaining operational efficiencies with their accounting system.  Encourage them to automate transactions electronically, and then support them with higher level services that help them grow and profit.

If your clients experience any of these symptoms above, even just one, they’re in need of an analysis.  Help them analyze their needs, and improve the use of their accounting system.

They’ll thank you for it.