The auto care industry can give business owners impressive profits as well as the ability to scale up, especially if you have the right tools in place. But this doesn’t mean it’s without its challenges. Here are some of the most significant obstacles when it comes to auto care accounting.
Lack of a Qualified Bookkeeper or Accountant
No matter how strong or weak the economy is, it can be difficult to find a qualified bookkeeper or accountant. These jobs require very specific skills and just the right body of experience to get the job done correctly.
Also, ideally, you don’t want someone who merely balances the numbers. You want to use the data your business generates to discover efficiencies and growth opportunities, such as:
- How to better balance your inventory in line with customer demand
- The most popular products
- The best ways to ensure you don’t overstock items that may not sell
This is where auto repair shop accounting services can be transformative for your business. You not only get accurate bookkeeping and accounting services, but you can also get insights as to how to better run your auto care business.
The amount and complexity of auto care inventory can be staggering, and without an organized control system, you may lose money through inefficiency. On the other hand, if you have an organized inventory control system in place, you get the ability to:
- Balance your inventory levels in a way to maximize your storage space
- Keep track of inventory spending
- Discover correlations between investment in inventory and business profits
- Strategize the best ways to maintain inventory based on supply chain factors
Getting Business Financials on Time
Business financial data can be all but useless if it arrives too late. Even comprehensive information about business accounts needs to be available at the right time so managers can make balanced, thoughtful financial decisions.
For instance, if a vendor has recently increased their prices by 25% and a manager is considering ordering more stock from them, having access to this financial data can power them to find a less expensive solution. In many cases, when it comes to the auto care business, it may be possible to source similar products of equally high quality from another supplier. But in order to make these kinds of decisions, you need to have business financials accessible at the right time.
Financials Not Being Audit-Ready
Another pressing issue arises from financials not being ready for an audit. This is common for auto care business owners, especially those who have to wear several hats daily. It can be very difficult to stay on top of financial documents and organize them in a way that will satisfy the demands of an auditor.
But by using bookkeeping for auto repair shops, you get financials that are not only easy to interpret internally but at or above the standards that auditors expect. This can save you time during an audit and also eliminate potential miscommunications that could result in fines or conflicts with the IRS.
High Operational Costs
The costs of running an auto care business are not only complex, but they can also easily get out of hand, especially without a systematic expense monitoring process. Even if your business is profitable and meeting its benchmarks, that doesn’t mean your operational costs are where they should be.
In some cases, without the right information, you may be missing out on business-critical data that could save you thousands of dollars. But if you have up-to-date cost data at hand, you can discover ways to lower operational costs and then reinvest those funds in growing or improving your business.
Inaccurate Vendor Records
Auto care shops often use many different vendors to supply their products, and it can be challenging to keep track of all of the purchases, bills, and orders from each one. Also, without being able to compare the amount you spend on one vendor to that of another, it can be difficult to decide which ones offer the best deals.
In addition, it’s easy to make mistakes when it comes to paying vendors, and you can’t rely on each vendor to catch your mistakes. This can result in wasted money, as well as time, especially if you have to go back months or longer to figure out where a mistake happened.
On the other hand, with bookkeeping and accounting services, you can stay on top of your records for all of your vendors. This enables you to avoid costly miscommunications and payment issues.
With PABS outsourced accounting services for auto care businesses, you have professional bookkeepers and accountants that produce financial documents ready for even the strictest auditors. You also get accurate vendor records that make it easy to analyze your financials, identifying opportunities to save on inventory. To discover even more benefits of PABS’ solution, reach out today!