My first task in January is to bring all of my bookkeeping up to date for the previous year and make blank ones for the new year. There are many methods you can use to keep track of things. There are off the shelf accounting programs like Quickbooks and Quicken, and programs specifically designed to track an artists inventory. When I started my business in 2001 I set up a series of worksheets in Excel and I have continued to expand on these over the years. My accountant says they are fine and no reason to change.
My spreadsheet system consists of 5 worksheets that interact with each other:
- Summary - Tracks income by type (instate, outstate, wholesale, consignment, shipping & handling), income and taxes by location (each city in WA has a different tax rate/code), overall monthly income/expenses and profit/loss.
- Inventory - each items cost (time, overhead, materials), price, # made, # sold, # instock
- Costs - monthly expenses, donations, theft, damage
- COGS - cost of good sold per month. Uses materials costs and number of each item sold.
- Booth Sales - Tracks each show I do with what sold, # days, # hours, # sales and expenses. These numbers are used to calculate sales/items/$/cost/profit per hour. I use these figures to rank the shows I do and drop out the bottom ones each year.
I collect all my data (go through credit card statements, checkbook registers, receipt files, etc) and populate any data that is missing. I should note here that during the year every Monday is book keeping day. That way this is not such a horrendous task. I also check the formulas in the worksheets.
My next task is inventory. I count all the items made. I am usually pretty close to what was recorded in my spreadsheet. Earrings are the place I can be off a few. Now I am ready to do local, state and federal taxes. Yippy skippy!
In January I also inventory my display items, make list of things to clean, repair or touch up (stands, tent frame and walls, tables, shelves, table cloths, shutters, banners). And I take stock of supplies I need to reorder (bags, tissue paper, tape, ink, biz cards). I also make a list of items to make and the things I will need to make them.
Whew, tired yet? The month is not over. I also need to plan my shows for the year and get show applications out. I need to keep up with my business Facebook page, newsletter and blog, learn new skills and start making things. Being self employed is hard work. but I love it!!! Thanks to all my customers, friends and supporters who have made this dream a reality.