How to Automate Your Bookkeeping

This is a Toolbox Tip and I’m talking about automating your bookkeeping or specifically the processing and payment of receipts, bills, and invoices from suppliers.

If you’re growing your trade business and you’re spending time in Xero or Quickbooks doing this work – entering data, reconciling, you probably shouldn’t be. Your job is to make stuff happen not so much to do these smaller jobs yourself. As the time you spend on admin and with your head buried in the books, is time you could be spending finding work and winning work for your team to do or helping your team do the work and making sure they do it well, on time, to standard and on budget.

You’ve got skills in sales and skills in estimating and skills in the design of your trade. You’ve got the skills to plan work and organsie your business and you’ve got your people’s skills. Your skills with people – your own people and your customers, that’s where the money is. You’re probably not that great at admin.

I’ve not met many trades people who are naturally inclined to be good at admin just like I’m not from dreadful admin. So get someone else doing it and importantly automate as much of it as possible. Automating things means nobody has to do it. It’s always cheaper if a machine does something rather than if you have to pay someone to do it by the hour.

There’s a good way to automate something and that’s to have a system, people and technology working together to achieve an outcome. And the more machine and the more system there is, and the less people that are involved, the cheaper the automation is going to be for you for your business and the less chance of mistakes happening.

People make mistakes generally, machines tend not to. That’s a massive generalization and not all automations are cheap (Tesla self-drive cars keep crashing although cars driven by people, crash all the time too) but when technology is cheap and easy like cloud-based accounting systems (Xero, MYOB),scanning systems (Dext and Hubdoc) automation, I think is definitely the way to go.

You can set it up so nobody has to enter receipts or bills into your system by hand, nobody has to type it in. Your technology does it for you, you can set it up so you’re not dipping into it into you invoicing and paying your bills every day – having that any kind of interruption to your day whenever someone emails you a bill, sends you a bill another way.

I’ve written a guide to help you plan it of course but the process goes something like this.

What you do is you set your Xero or your Quickbooks up, you set up Dext or Hubdoc, you set up an email address – accounts@at yourbusiness.com.au or whatever and you get all bills and invoices sent to it including when your guys out, they’re in the field of buying something from a supplier and they pay on the company’s credit card. They can take a photo of the bill – they paid and send it as well with the job number written on the receipt. You get all bills and invoices sent to that email address, you have someone for them all once a week only to Dext or Hubdoc and filter out the shine to spam and stuff.

Then you, perhaps with your admin or your bookkeeper log in and approve them all and check job numbers and things like that, check they’re allocated to the right places.

You do that once a week, takes you a very small amount of time. You send them all to Xero or your admin person does. The person doing that job does that for you once a week again. You meet with your person, your bookkeeper, or your admin and you agree which of the invoices in your accounts payable in your Xero are going to be paid. They set up a bulk payment, they send it to you to approve, you send it to your bank, and your bill paying is done.

So for you, it’s two short meetings and one approval per week. Your admin person has no data entry – a few mistakes are made and we minimise errors from typing stuff in and you’ve minimise the time impact on both you and your admin people. You can extract the data and upload it into your job management system or somebody can.

And if you’re using a job management system that lets you order materials from within it, that’s fine because they still end up in Xero and then they fall into that weekly payment process. So this system works even if you don’t use your Dext or Hubdoc but you can order from within your job management system with AroFlo or SimPro. Those should be done within your job management system and then flow through into your accounting system of course.

Now, this isn’t the only way to do it I’m sure. It’s a damn fine way to do it, it was talked to me by Don Doolan from First Class Accounts Asquith. I’m giving him credit where it’s due. His business does bookkeeping for trades and builders and if you want someone to do this for you rather than having a business coach to tell you to crack on with it, then maybe talk to them. If you want the guide, of course, let me know.


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