It's great to have a well used accounting system quietly gathering thousands of data points about your business. Your bank transactions. Your invoice detail lines. Your purchases. Your stock movements. Your postage and electricity costs. The location of your customers. Their history with you. And so on.
But how to turn it into profitable insights?
Turning raw data into growth is Profit Engineering, the speciality of GrowthPath. It's based on finding what exactly wins you business: your points of difference, measured the only way which makes sense: the behaviour of your customers. We want to measure that with a few indicators. Next, we look at the decisions are you need to make, and we make sure that you get the information you need to properly influence those decisions. A lot of this is non-accounting numbers.
These are some articles you may find interesting:
From the Profit Engineering track
- Contribution Margin vs Gross Margin, a simple, easy improvement to reporting for more profitable decisions
- Choosing an inventory method: Perpetual or Periodic. The Perpetual method is vastly superior and well worth the extra effort
- Cash vs Profit: the uses and abuses of these two performance measurements
- Measuring your procurement effectiveness with the Purchase Efficiency KPI
Xero and large transaction volumes
Xero Transaction Limits and larger businesses: Nov 2018 update There are questions about how well Xero performs under "higher loads". Our first concern was for medium-sized wholesalers. Xero talks about limits as low as 1000 'transactions' a month. Our testing shows that Xero performs well at much higher transaction volumes. The first test results are based on 3 years of 2500 transaction rows per month (and then matching payments uploaded via a bank CSV). The second test run was much larger. Note that after some discussions with Xero and based on our own experience, we (GrowthPath) believe that businesses can interpret the 'limit' of 1000 invoices a month as advisory. This limit does not form part of the terms of service. In Jan 2017 Xero published some small changes to the API limit, and these limits, which are enforced, allow a much, much higher load than Xero's advisory limits. Hence, stress testing is relevant because you will reach the practical limits of Xero before you exceed API...
Choosing and implementing a new accounting or ERP system
Advice & recommendations on selecting and implementing a new accounting or ERP system, cloud or otherwise. Including strategies for going live, and when to to live. What are the main steps in the project? What testing is needed? When you should you go live?
Cloud ERP supply chain review Xero + Dear Inventory, Unleashed, Cin7 and others
Cloud ERP inventory for wholesalers, manufacturers and importers Unleashed, Dear Inventory, Cin7, Neto and Trade Gecko compared and reviewed, in a nutshell GrowthPath has migrated clients in Malaysia, Singapore, New Zealand, the UK, PNG and around Australia to cloud ERP solutions. The clients left desktop solutions sch as MYOB and SQL Server-based legacy systems for cloud-based accounting and supply chain solution (ERP). We have success with Xero + Unleashed, Xero + Dear Inventory and Xero + Cin7. At the moment, we recommend Dear Inventory for most clients needing a supply chain solution, and Cin7 for more advanced requirements including POS, an integrated B2B portal and better logistics and market-place integrations. We see the competitive pool also including Unleashed and Trade Gecko, but at this stage Dear and Cin7 are our recommended solutions. Broadly, Unleashed, Dear Inventory and Trade Gecko are competing for the same target market. They are good general purpose supply chain...
Advanced and Custom Cloud Integrations
Custom Integrations for Cloud APIs About Integrations and Cloud apps Large business systems are built from modules. This is very ancient tradition of accounting: way, way back in the day, accounting was run with different ledgers, such as the sales ledger or the stock ledger, and periodically summaries were copied to the general ledger. When you implement a system, you choose a provider of these modules. If you choose different providers for different modules, you need to understand how they integrate, which means how they exchange information. When functionality is very generic, it's common to find a single solution with a core set of modules which integrate. It is very rare to find an accounting system which does not provide ledgers such as sales, bank, AP and AR, and you don't need to worry about the integration. Not so long ago, accounting applications still required you to post transactions from one module to another, but this vestige of the middle ages is gone in Xero. But as...
MYOB AccountRight Premier / Classic and ATO Single Touch Payroll
On July 1, 2018, the ATO requires all Australian businesses with more than 20 employees to use Single Touch Payroll. The census date is actually in April 2018. Users of MYOB Account Right Premier face an interesting problem. They are using software which doesn't really get feature updates because MYOB is encouraging subscribers to move to Account Right Live, a monthly-subscription product. This product was called Account Right Live for a few years. I will refer to it as Account Right Live. Account Right Live doesn't support foreign currency and does not have multi-location inventory, and is unattractive for other reasons (it requires a Windows computer. It can store data in the "cloud", but it's is often too slow and larger businesses are most likely going to revert to local data, which means you basically have your old MYOB, but without foreign currency). Many businesses have stayed with legacy MYOB because they can't use Account Right Live or don't find it worth the effort of...
Review of Cloud Accounting: Xero, Saasu, MYOB, QuickBooks
GrowthPath's review of Xero, Saasu, MYOB and QuickBooks is a detailed comparison of the leading cloud accounting software for mid-sized and larger Australian SMEs. We discuss the pros and cons of moving to the cloud, and how cloud accounting is the building block of cloud ERP. UPDATE: On March 8, 2018, Saasu basically announced it was withdrawing from the SME accounting market (to focus on micro-businesses). This article has not yet been updated to reflect this change. In a hurry? This short article covers the key initial questions: Top questions about migrating to cloud erpIf you want more coverage of cloud ERP choices, see this detailed comparison of Unleashed, Dear, Cin-7 and how they work with Xero Summary To summarise, for most Australian SMEs, Xero is the best choice. Xero has more functionality, more extensions and more support than its competitors. It's only technical rival is QuickBooks online, but Quickbooks Online has a small market share in Australia. The dinosaur is...
Dear Inventory: Advanced Pricing Module
Easier access to Dear Inventory advanced pricing Dear Inventory has a powerful advanced pricing module in addition to the standard ten price lists and customer-level discounts. Not many clients use the advanced features because it's hard to understand and hard to set up; for example, the second step requires a CSV upload in many cases. Dear has now put a graphical front end to advanced pricing, making it easier to use. Advanced pricing is the place to add quantity breaks and free shipping rules, as well as much more. What is 'advanced pricing'? The advanced pricing rules can either provide over-riding prices, that is, the rules acts like a new price list, or they can merely modify the price the customer was going to receive anyway (discounts for higher order quantities, for example). Advanced pricing is also the only way you can make special pricing for some but not all products for some but not all customers. Finally, the rules can have start and end dates, something else you...
Dear Inventory B2B Portal overview
Dear Inventory has a fundamental B2B portal which is in its second release. Bottom line: it's easy to setup (a couple of hours at most to get up and running), it's free and it automates basic order enquiries and order entry. You control exactly which customers can use it.
Allocations in Dear Inventory
Allocation Logic in Dear Inventory, explained Dear Inventory has two order flows, Standard and Advanced. They both let you prioritise stock with soft and hard allocations if you use manual picking. The Advanced module has another option: authorised orders with no allocation at all. In this article, we see the differences between soft and hard allocations, and how to override soft allocations to prioritise which customers get scarce stock. You can swap a Standard order to Advanced. An order created in the standard process can move to the Advanced process via the Convert button. See the picture below.
Per site cost valuations in Dear Inventory
Some tips on getting per-location costing in Dear Inventory for more accurate margins. Dear Inventory is a cloud-based inventory system which is currently GrowthPath's default recommendation for general purpose cloud ERP systems. Dear has a well-thought approach to stock valuation. From the beginning Dear was designed to give users the chance of activate batch and serial number tracking for receipts, and Dear decided to fully support this with FIFO product costing per batch or serial. In fact, Dear users FIFO costing as its costing method for standard stock as well; the common choice is weighted average. FIFO and weighted average are the same over time. Like its competitors, such as Unleashed, Trade Gecko and Cin7, Dear allows multiple locations, but it does not keep costs per location. Imagine that you are receiving stock into an Australian warehouse and a New Zealand warehouse from a Chinese supplier. You may have the same FOB price, but different landed costs. Dear handles landed...
Cloud ERP FAQ
Common questions about cloud ERP Cloud ERP (Dear Inventory, Unleashed, CIN-7, Trade Gecko, Stitch...) has huge advantages: fast to deploy, easy to learn and with much better reporting and insights that traditional ERP software. Above all, these packages integrate so easily with CRMs, accounting, online stores, third-party fulfilment, shippers. The business model is different: you pay per month, you no longer host the data. Here we quickly cover the main questions, advantages and disadvantages of cloud ERP for SMEs. We have a much more in-depth review of common cloud ERP solutions here: A review of cloud ERP for Australian SMEs
Cloud Accounting and ERP Security Risks
Business risks of cloud software Cloud software has security risks, data-lock-out risks and connectivity risks. These risks can be avoided, and cloud software eliminates other major IT risks. Overall, moving to cloud apps such as Xero probably increases overall security and lowers data risk if sensible policies are in place. Before moving to cloud accounting such as Xero, or to a cloud ERP system, it's worth reviewing these risks.
Extracting data from MYOB with ODBC SQL
A tutorial about accessing data from MYOB Premier using SQL.This technique opens up much better insights, interactive reporting and feeding data into dashboard tools, as well as making data migration into a new system much easier. You can also automate or partially automate intercompany reconciliations, and detailed cashflow analysis.
IT used by GrowthPath
Here is the IT in use at GrowthPath. Accounting Since our foundation, GrowthPath has used cloud accounting. Initially we used MYOB Essentials, then Saasu, and as of 2016 we are on Xero. CRM and Project Management We use Pipedrive. Pipedrive is an excellent CRM for deal-based businesses. We have become big fans of Trello. Quotes are prepared with Nifty Quoter. Email & Cloud Apps, Client OS We use Google Apps/Google Drive. Desktop OS is a mix: OS X preferred, Chrome OS and Windows get some use. Mobile devices are now mostly Android. Web services, Analytics We have servers, and client servers, hosted with AWS and Digital Ocean. We use Ubuntu as the platform of choice. We use namecheap for SSL certificates, and a variety of registrars for domain names. Analytics is 100% Google. Content Management GrowthPath uses Joomla, self-hosted, although we have good Wordpress skills. Traffic Generation GrowthPath does not currently use any paid traffic generation techniques. Our SEO is good and...
Advanced use of information for SMEs
Applying relevant information to make better decisions is a very important outcome of a medium-term IT plan. Cloud solutions are really good at enabling this, even if the first phase focuses more on the operational foundations. There are many options available for cost-effective business intelligence solutions in the cloud. Amazon, for example, has developed a rich layer which has stimulated many offers: Google for “Amazon Redshift marketplace”. Advanced reporting, or business intelligence, has three components. It has a reporting or data visualisation front end (graphs, dashboards, reports etc). It has a data store and analytical logic layer, which imports data from different sources and allows us to group and relate the data to support the visualisation layer. Business Intelligence products always include these two layers. Many of the cheaper cloud solutions, such as Zoho Reports, effectively stop with these two layers. The third layer is very important. Technically it is know as...
A hidden gem: Neto/Saasu Integration
A hidden gem: Neto/Saasu Integration Neto is an excellent hosted online store. It handles wholesale and retail very well (simultaneously), and has the best-on-the-market integration with Australian shippers, anywhere. Better than Unleashed, Dear Inventory, Shopify ... On top of that, Neto looks after multiple price lists, variations, multiple stock locations,has a decent template engine, a fast backend, good ebay integration. It does backorders like MYOB, which is actually much more suited for smaller wholesalers than the current approach of Dear and Unleashed. A startup from Queensland with Telstra as a significant shareholder. It's not perfect: It doesn't do multi-currency, its reporting is average. And it has no purchasing module. It doesn't do supplier invoices, receipts and costing. For this, is expects you to integrate it with something else. A Neto / Saasu integration offers a lot for the money.
Making sense of the numbers
It's great to have a well used accounting system quietly gathering thousands of data points about your business. Your bank transactions. Your invoice detail lines. Your purchases. Your stock movements. Your postage and electricity costs. The location of your customers. Their history with you. And so on. But how to turn it into profitable insights?
MYOB crashing and too slow? Don't immediately replace it.
Is MYOB crashing? Too slow? It may be time to upgrade, but first there are some fixes worth trying which can reduce crashes & lock-outs, and improve MYOB speed and performance.
MYOB: Renovate, Extend or Replace?
Businesses outgrow MYOB. But this doesn't require an immediate replacement.