This is Part 3 in a series of posts. If you haven’t read the first two parts check them out here:
Part I: How Did We Get Here?
Part II: 4 Things We Learned Using LivePlan
When we first started this company as Star Dot Star around 10 years ago the tools available to small businesses to run their company were surprisingly limited. For accounting, you had QuickBooks as really the only viable option. And it was a desktop-based application. They had only just started their online offering a few years after we started our business. Also QuickBooks was a Windows-only offering at the time and we are and have always been mainly a Mac shop. So that meant we had to have a Windows box in our offices for the main purpose of running QuickBooks. We then had the option to either physically use the Windows machine or use Remote Desktop to work on QuickBooks. And that would only work if that computer was on. And so on…
Those things are all only obstacles to getting into QuickBooks to use it. QuickBooks seems incredibly confusing and overly complex for running a business like ours. It’s super flexible and basically lets you do anything you want. But we are Graphic Designers, Marketers and Software Developers, not book keepers! How do we know what to do in QuickBooks? We don’t really care how it gets done only that it gets done!
We are Graphic Designers, Marketers and Software Developers, not book keepers! How do we know what to do in QuickBooks?
This begs the question of why we didn’t just hire a book keeper to help us do our books? Good question! I have no answer!
So now here we are in 2014 and we are getting back into managing our business. When we looked around to see what is available for us now we were amazed! There are so many great products out there that are soooooo much better than QuickBooks! After some research and digging around we decided to use Wave Accounting for our books. We chose it because it is simple, very simple. We also had some friends recommend it. Lastly, it is fairly inexpensive.
Wave is essentially free to use to do basic management of your business accounting needs. You get syncing with your bank account, invoicing, billing, receipt tracking, and general reports. So for free you get a full-fledged system to do most of the things you’ll need to run your business. It’s online and has several mobile apps to give you a fast and easy way to manage your business’s accounting.
Like most accounting software Wave comes with a basic set up that includes many useful Expense and Income accounts for you to categorize your transactions. You can also add/change these default categories to suit your needs. I found we only needed to add a few to meet our requirements. Using the Transactions section of Wave to sync with your business bank account you can quickly and easily get your accounts balanced and transactions correctly categorized. Then, using the Dashboard and Reports areas you can see how your expenses and income stack up. How much did you spend in certain areas for your business? How much have you earned so far compared to your expenses? Which invoices are coming up or are over due? How much do you owe in bills in the coming 30-60 days? And much more.
Invoicing is super simple also. You can customize your invoice with your logo, etc. Then create an invoice with one or more line items, save it and email it to your customer. The customer will receive an email with the basic invoice details and can click to view the full invoice online. You can also send the invoice as a PDF or even print it depending on the requirements of each customer. We wanted an easy way to receive money from our customers without having to wait for them to send a check. With Wave you can easily set up your account to Accept Credit Cards. Once set up, your invoices in Wave have a button at the top for the customer to pay by Credit Card. It costs a little extra money to accept credit cards but in the end we felt it was worth the cost because we found we were paid faster.
Do you find yourself in a pile of papers trying to find the receipts for gas, postage, meals and entertainment?
Easily capture receipts using your phone’s camera and Receipts by Wave. Photo from Wave.
When it comes to filing your taxes for your business do you find yourself in a pile of papers trying to find the receipts for gas, postage, meals and entertainment? If not, then you are more disciplined than we were with our company 10 years ago. This time we wanted to avoid that situation completely! Wave to the rescue! Wave has a section for Receipts along with a mobile app (Receipts by Wave) that makes handling receipts quick and easy. Basically what you do is this: get a receipt for some business expense, open your Wave Receipts app on your phone, snap a photo, save, done! Or if you get a airline travel itinerary email, just forward it to receipts@waveapps.com and it will automatically be added to your receipts section in Wave. Easy, cheesy!
Wave also has a handy Invoice app (Invoice by Wave) which allows you to quickly create an invoice on your phone or send a friendly reminder if an invoice is past due. It gives you notifications of when a customer has viewed an invoice and when one was paid using credit card. This is a great tool to have when your business requires you to be away from your computer much of the time.
The last thing we wanted to do was to handle payroll in an easy manner and hopefully have it tied to our accounting software. Wave is perfect for this. For a very small fee (for our 2 person company we pay around $10 per month to have payroll handled by Wave including direct deposit) all of your payroll needs are taken care of. You set up your employees, their salary (or hourly rate), tax information, payroll frequency and Wave does the rest. You only need to approve each payroll session and then Wave takes care of everything including direct deposit.
We want to spend our time creating great marketing and software solutions for our customers, not figuring out how to manage our accounting software.
For us Wave has been great and has really taken the guesswork and tediousness (can you say that?) out of our accounting process. As I said before, we are not book keepers or accountants so we needed a solution that kept it simple for us. We want to spend our time creating great marketing and software solutions for our customers, not figuring out how to manage our accounting software.
In the future we will likely hire a part time book keeper to help us manage our Wave account but the day to day work will be done by us in Wave. I feel that this is just another piece of the sometimes overly complex and daunting puzzle that we all have to master while running our businesses.
Stay tuned for our next post in this series which will tie it all together and give an update to see where we are after several months using these new tools.