Integrating Accounting With Chaindrive
Retail businesses have specific accounting needs that other businesses don’t have. For instance, you’ll often have merchandise that you have purchased and which you must figure out what to do with after so many days, weeks, or months of not selling.
Book retailers can often return books to publishers for a credit or refund. They rip the covers off and send them back. The publisher gives a credit to the retailer for future purchases.
Other retail sectors have their own way of dealing with returnable merchandise.
Another retail problem is clearance items. You’ll see this often in fashion and textile industries. You hold onto an item for several months and realize that it’s not going to sell, for some reason. So you put it on a clearance rack and hope to get rid of it at a discount. But you don’t want to lose money on the item.
You may have to lose a little money anyway. If the item still doesn’t sell, recycle it again. Move it back onto your shelves and then a couple of months later it will end up in the clearance bin again at a bigger discount. Eventually, it will sell.
Your accounting department has to figure out your profit and loss based on several factors. An integrated accounting software designed by retailers will take all of these unique business variables into consideration. The result is, you’ll have a retail business that functions more smoothly and more profitably.