It should go without saying that maximising profit is the number one priority for most businesses.
One of the best ways of doing this is accurately and effectively working out exactly what your products or services cost.
Not what you think it costs or what your customers think it should cost but what it actually costs.
What resources you are buying, what employee time is being used and more, should all be taken into account when costing a job, item or a service.
Having software that can analyse this data and accurately present up to date costing could be integral to ensure your business is profitable.
Fortunately, Sage have a module dedicated to exactly this important process.
In this article, we run through the great features that make this a must have for businesses in the manufacturing, wholesale and financial industries.
We’re guessing you’ve heard of Sage before but if you need a refresher, here’s a rundown of one of the best pieces of business accounting software out there.
Sage is a UK based FTSE 100 company which serves more than 800,000 businesses in the UK and Ireland alone, including more than a third of the other FTSE 100 companies.
Their industry leading software offers specific solutions and add-ons that run alongside businesses to streamline and enhance their processes and help them achieve objectives.
Sage 200, their primary solution to all of the biggest problems faced by SME’s, is highly customisable and allows specialist modules to be added to serve business specific needs.
Some of these modules are suited to specific sectors and some solve problems that are faced by multiple areas of industry.
The Project Accounting module is one such module but it is perhaps more relevant to ‘Service led’ businesses.
One of the main ways the Sage 200 project accounting module serves businesses is by providing detailed reports and cost breakdowns for your project.
It can be tailored and designed to replicate your business structure and modified to match terms relevant to your business.
‘Project’ may not be relevant to most financial or wholesale businesses for example. This can be changed to something like ‘Job’ or ‘Event’ instead.
You can add analysis fields to any area of these ‘projects’ to track specific information and gain valuable data that can be used in the costing process.
Custom templates and historic projects can be re-used later to make the process quicker down the line and increase profitability.
The clearer the overall costs that contribute to a project are, the more accurate your costing will be for what you charge.
Arguably a company’s biggest resource is its staff and workers. Whether they work in the office, on the manufacturing shop floor or remotely as contractors they are going to hugely impact how much a project costs.
Ensuring you manage this resource effectively is pivotal to increasing profitability.
Within Sage 200’s project accounting module, is the ability to capture timesheet info. This can be done by batch data entry or online.
With this information easily to hand, costing a job has never been easier. Project managers will have greater autonomy to make decisions on purchase orders which include buying services and hiring contractors.
You can more easily include contractors in the process by treating them as suppliers and paying them in the same way.
Of course, integration with other parts of the Sage software is always high on the list of benefits to using the software.
This is certainly the case with project accounting. It links with Sales and Purchase Order processing as well as Sage Payroll to make for a highly integrated system.
When Sales orders and quotations come in they can be turned into projects straight away and stock and resources can be allocated.
Unsurprisingly, the time and resources that you track in project accounting can be connected to the payroll.
This integration can of course be tailored to suit your company requirements.
Not all jobs work to the same billing schedule. Suppliers, contractors and more need paying at different times but it’s often hard to keep track of these things.
You can choose automatic or manual schedules which can be adjusted depending on the needs of the business.
Invoicing customers is also made much easier with easy to use templates and the automation provided by the system. Producing accurate and timely bills is only going to improve the efficiency of your organisation.
So, there you go, keep on top of your accounts and ensure individual projects or jobs are as profitable as they can be with the project accounting module.
If you want to learn more about this, get in touch with us and read our other articles on the Sage 200 system.