As a small business owner, keeping track of your finances should be one of your top priorities. However, you also have a long list of tasks and responsibilities to keep your business operating, so finances can often feel like a burden. For those who aren’t professional accountants but still want to manage your finances professionally and easily, Quickbooks accounting software is a great tool. This article is to help you manage your finances and use Quickbooks for auto repair shops, auto reconditioning shops, and auto detailing shops.
Let’s start with why you should use Quickbooks for your auto repair shop. When it comes to your accounting and finances, you have two options. You can choose to hire someone to do it for you, or you can choose to do it yourself. QuickBooks is set up to be user and beginner-friendly, so that even if you’re not an accountant it’s relatively simple to navigate. Thanks to Quickbooks, many small business owners with auto repair, auto reconditioning, and auto detailing shops choose to do it themselves.
With QuickBooks you can create invoices, track cash flow, pay bills, generate reports, and prepare for taxes. Better yet, for Mobile Tech RX users, Ouickbooks is fully integrated into our app. When you use both at the same time, your estimating, invoicing, and accounting will work together smoothly.
Learn how to use QuickBooks and Mobile Tech RX together to get your finances in order for your auto shop below:
Review Past Income
One of the best ways to plan ahead is to look back. The first step in making a financial plan is reviewing your income from the previous years of your business. You can do this by pulling up all your invoices and adding them up to give you your total revenue. (We’d recommend you break them up into yearly, quarterly, and monthly calculations.) If you don’t have this information in one place, now is a good time to start.
If you use Mobile Tech RX, you can create estimates and invoices that will be saved in your app and Admin Portal. To find past invoices, go to the ‘Documents’ tab in your Admin Portal <link> and click ‘Invoices’. If you don’t use Mobile Tech RX, you can also create invoices in Quickbooks to track sales as you go.
Pulling your invoices and reviewing them helps you see how much revenue you’ve generated every month, quarter, and year. This can help you track trends or seasonality and see how your business revenue is increasing or decreasing over time. You can also use past revenue numbers to help you predict the revenue you will make in the future.
Track Your Spending
Another big part of managing your finances is tracking your expenses and knowing where your business spends money. Your expenses include anything you’ve spent on your business, like employee pay, tools and supplies, products, taxes, and rent.
Quickbooks will track and categorize your expenses for you. That way, you can see where every dollar is going and find areas where you may want to cut back. Click here for more information on how to track your expenses from the Quickbooks blog.
In the Quickbooks application, you can take a photo and upload your receipts. QuickBooks will use your receipts to help you track your expenses so that you can manage your spending. By knowing your spending patterns, you can plan ahead and make sure you’re covering your outgoings like rent and bills.
Report Past Profits
Once you know what you’ve brought in (revenue) and how much you’ve spent (expenses), you’ll want to calculate your profits. To do that, subtract your total expenses from your total revenue. The goal is to have a positive number for your profit. You want to be making more in revenue than you are spending in expenses.
With Quickbooks and Mobile Tech RX, you have access to lots of useful reports that make it simple for you. These include a profit and loss report, a balance sheet report, and a statement of cash flow. The profit and loss report summarizes your income minus any expenses to show how profitable your business is in a given time period (week, month quarter, or year).
With all of this data you’ll have a clear idea of where your auto repair or detailing business stands. Now you can start planning ahead and create a financial forecasr. A forecast is using past data to predict what will happen in the future. Using the information you have, you can now forecast your profits, revenue, and expenses for the next few months and the rest of the year.
It’s a good idea to plan for a few different scenarios so that you’re prepared for both the best case and the worst case if they happen. You should also consider setting performance triggers. A performance trigger is a business metric that shows you your business health. Keeping an eye on your performance triggers can act as a warning that you need to make some adjustments to maintain your business. So, for example, if cash flow is negative for two months, can you take on more customers or cut expenses?
Prepare for Your Taxes
Like Benjamin Franklin once said, if there’s one thing that’s certain in this life it’s taxes. If you find yourself wading through a pile of paperwork when it comes to tax season, it’s time to think again. The last thing you want is to miss out on tax deductions because you can’t find a receipt.
Another benefit of being able to photograph your receipts and add them into Quickbooks is that you can attach them to banking transactions as you go. Now they’re all stored and organized at the end of the tax year. Deductions for an auto repair, recon, and detailing businesses include any costs related to running your business, such as cleaning supplies, staff uniforms, company cell phones, fuel costs, travel costs, and employee wages. If you’re a mobile business, you can also write off mileage.
In Quickbooks, you can automatically split your expenses into the right tax categories so that you keep more of what you earn. If needed, you can also easily download and share the documents with your accountant so that they can prepare your tax return for you, when the time comes.
Access Help When You Need It
It’s always better to ask for help than to struggle and potentially make mistakes. Those who need some additional support with their accounts can pay a little bit extra for a Quickbooks expert to manage their bookkeeping for them. For a monthly fee, you will be matched with an accounting specialist who understands your business and can do your accounting for you. And, as always, the team at Mobile Tech RX is here for you so that your auto business can thrive and grow.
If you’re a Mobile Tech RX user, you have the option to integrate your Mobile Tech RX account with your Quickbooks account. This means all of your information is stored in one place. To see how Mobile Tech RX can help you manage and grow your auto recon business, start your free trial now.