Running a hospitality business is not for the faint of heart. Between managing reservations, keeping track of inventory, and ensuring every guest has a memorable experience, there’s barely time to catch your breath, let alone balance the books.Traditional accounting software and processes are inefficient and costly, and they can’t serve the modern hospitality sector adequately. They really, really, can’t.
Fortunately, a newer and better solution is here: automated accounting. While many hospitality businesses have already made the switch, plenty of operators are unfamiliar with it and have questions. If that’s you, we’ve got you covered.
This article will walk you through what automated accounting is, how it works, and why it’s a game-changer for the hospitality industry.
What is Automated Accounting?
Automated accounting – also known as accounting automation – refers to the process of using technology to handle accounting tasks with minimal human intervention. According to a McKinsey report, most accounting tasks can be easily automated.
It covers several accounting processes, such as data entry, transaction recording, payroll, accounts payable and accounts receivable, invoice processing, expense management, and financial reporting. The main goal is to use technology to manage these routine tasks, making them faster and more accurate.At its core, automated accounting relies on powerful tools and algorithms. It may use AI and machine learning for more sophisticated processes or simpler automation technologies.
These systems can connect with other business software and systems, like point-of-sale (POS), banks, reservation management, and inventory management tools. This integration helps ensure that data moves very smoothly between different parts of the business so that you have a clear and accurate financial picture.
For example, when a sale is made, the POS system sends the transaction details to the accounting software. The system then categorises the transaction, updates the accounts, and records the entry in your general ledger.
That’s the magic of automation – it eliminates manual tasks, reducing manual errors and speeding up bank reconciliation.
Key Features of Automated Accounting
Automated accounting systems come packed with features that make managing financial operations in the Hospitality sector easier and more efficient. Here are some of the key features to look out for:
1. Automated Data Entry
Manual tasks like data entry are a huge time killer. Automated accounting systems can pull data directly from your transactions, invoices, and receipts and enter it into the correct accounts. This not only saves time but also boosts accuracy. Who doesn’t like to have their financial records always up-to-date?
2. Data Integration
One of the biggest advantages of automated accounting is its ability to integrate with other business systems. Whether it's your point-of-sale (POS), banks, supplier portal, reservation management, or inventory tracking, seamless integration ensures that data flows smoothly between systems. This means you get a comprehensive and accurate financial picture without juggling multiple platforms.
3. Fast Financial Reporting
Automated accounting gives you access to speedy financial reports and insightful Key Performance Indicators (KPIs) at the click of a button. Profit and loss statements, balance sheets, cash flow reports – these systems generate detailed reports much faster than your standard setup. This feature helps you make informed business decisions quickly based on the latest data.
4. Expense Tracking
Keeping tabs on expenses is crucial for any business. Automated systems categorise and track expenses as they occur, giving you a clear view of where your money is going. This feature helps with budgeting and identifying areas where you might be able to cut costs.
5. Invoicing and Billing
Automated accounting takes the hassle out of invoicing. The system can generate and send invoices automatically, track payments, and even send reminders for overdue accounts. This way, you get paid on time every time, and reduces the administrative burden on your staff.
6. Payroll Management
Managing payroll can be complex, especially in the hospitality industry with its varying shifts and seasonal staff. Automated accounting systems handle payroll calculations, taxes, and benefits and can process payments and generate payslips automatically. This ensures your employees are paid correctly and on time (and remain happy!).
7. Compliance and Tax Preparation
Automated systems maintain accurate and consistent records, making it easier to meet regulatory requirements and prepare your tax reportings. This reduces the risk of non-compliance and any oh-so-inconvenient penalties. Outmin goes even further by doing taxes for you.
8. Scalability
As your business grows, your accounting needs will change. Automated accounting systems are designed to scale with your business. They can handle increased transaction volumes and more complex financial processes without missing a beat – a sustainable solution as you expand.
What Are the Benefits of Automated Accounting?
Now that you have a better idea of what automated accounting is all about, it’s time to look at the good stuff. Automated accounting brings numerous benefits to the hospitality industry. Let’s have a look:
1. Time Savings
Automating repetitive tasks like data entry and invoice processing means you and your staff can spend less time on tedious work and more time on strategic activities. This frees up your team to focus on providing great customer service or planning for future growth rather than getting bogged down in paperwork.If you’d like to get to know some real-life examples of this, we’ve got you – PI Pizza is saving over 120 hours every year, while Devour Bakery’s owner, Yvonne Murphy, finally has time to catch up on her dream travel plans. Both switched to Outmin.
Automating repetitive tasks like data entry and invoice processing means you and your staff can spend less time on tedious work and more time on strategic activities.
2. Improved Accuracy
Human errors in financial records can lead to big problems. Automated systems reduce these mistakes by handling the data entry and processing for you. This means your financial statements are more reliable, and you spend less time correcting errors.
3. Money Savings
Automation cuts down on the need for manual labour, which can save your business a lot of money. Plus, with fewer errors, you avoid costly mistakes. Better financial management helps you optimise how you allocate your resources, ensuring you get the most out of every cent spent.No wonder PI Pizza is saving 66% compared to its previous accounting function, and Yvonne Murphy openly shares that “you could be saving yourself about €35,000 a year.” Doesn’t sound bad, right?
4. Enhanced Decision-Making
With real-time insights into financial data and your business's financial performance at your fingertips, automated accounting empowers you to make data-driven decisions quickly. As they say: knowledge is power!Whether it’s adjusting pricing strategies or planning for future investments, having accurate and up-to-date information allows you to react swiftly and strategically to changing circumstances.
5. Financial Transparency
Automated accounting systems provide a clear and detailed view of your financial health. This is an underrated benefit that is actually incredibly important.This transparency helps in identifying trends, spotting potential issues early, and understanding the financial implications of business decisions. And, of course, this builds confidence among stakeholders, including investors, partners, and management.
Switching to Outmin
Outmin isn’t just another hospitality accounting software – we’re specifically designed for the unique needs of the hospitality industry. Unlike other accounting tools like Sage, QuickBooks, and Xero, Outmin is way more than another tool designed for accountants. We're the first unified accounting solution designed to take the admin burden off your plate. How?
We actually replace the entire accounting function and eliminate the need to work with an accounting firm or hire an accounting team. It’s as simple as dragging and dropping documents into our app, so our accountants can do the work for you.
From bookkeeping to payroll, tax, and weekly reporting, our AI-directed financial platform makes it possible to never work on manual data entry and tedious accounting tasks again. We’re able to offer this by combining powerful AI and a team of financial experts, all working in the background to take care of everything for you.
And if you think that switching is just way too complicated, think twice. Onboarding is actually easier than it seems because we created a very systemised, foolproof onboarding process. You just complete a few tasks on our platform. That’s why we can get you up and running 3x faster than the industry standard.
Plus, we offer training so that you and your team can be as comfortable as possible using Outmin.
Got Questions, Still? We Have Answers
If you’re still on the fence about switching to automated accounting, you’re not alone. Many hospitality business owners have questions before making the leap. So, here are some common questions and straightforward answers to help you decide.
Q: Is automated accounting really worth the investment?
A: Absolutely. You’ll save on labour costs, reduce costly errors that can be difficult to fix, and improve overall efficiency. Many businesses find that the return on investment comes quickly as they save time and money on day-to-day accounting tasks.
Q: Will it be difficult for my staff to learn the new system?
A: It depends on which system you choose. Some software is designed for accountants and not business owners, which can make things a bit more complex for you. Outmin, on the other hand, is 100% user-friendly, and you can pretty much “set and forget it”, while other accounting systems still demand a lot of input from you.
Q: How can I be sure that my financial data is secure?
A: Security is a top priority for any reputable automated accounting software provider. Look for systems that offer robust security features such as data encryption, regular backups, and multi-factor authentication. These measures help protect your sensitive financial information from unauthorised access and data breaches.
Q: What if my business is small? Do I really need automated accounting?
A: Automated accounting isn’t just for large businesses! Small businesses greatly benefit from it. Automating your accounting processes can free up valuable time for you and your staff to focus on growing the business, improving customer service, and other critical tasks. Plus, many automated accounting solutions are scalable, meaning they can grow with your business.
Q: Are there automated accounting solutions that can handle the specific needs of the hospitality industry?
A: Yes! Outmin is an automated accounting solution focused specifically on restaurants, cafes, pubs, bars, and other hospitality businesses. We know the ins and outs of this industry, and we can help you achieve financial stability and a more successful business.
Q: Can I integrate automated accounting with my current systems?
A: Yes, most automated accounting software is designed to integrate seamlessly with existing systems, such as POS, supplier invoices, bank accounts, etc. You can find accounting systems that will work in harmony with your current setup, making the transition smoother.
Q: What if something goes wrong? Is there support available?
A: Reputable automated accounting software providers offer robust customer support. That’s certainly the case if you go with Outmin. Our clients can always reach us via Slack, WhatsApp, email, or in-app, and we answer within 24 hours. Before committing to a provider, be sure to check their support options.
Q: How quickly will I see benefits after implementing automated accounting?
A: Many businesses see improvements almost immediately after implementing automated accounting. You’ll likely notice time and reduced cost savings and reduced errors within a short period of time. Valuable insights and reporting will also be more accessible, helping you make better decisions sooner.
Ready to see automated accounting in action?
Let’s get you a free demo! No strings attached. Ask for it here, and we’ll be in touch within 24 hours.
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