I remember back in 2014, we got to the end of the year and sat down with our CPA. She handed us our annual Profit and Loss statement and said, “OK guys you had a great year!”
The problem was, none of us felt like we had a great year. You see, we have four owners: Justin and myself, who you know, and Angie and Dustin (who, while they aren’t part of Next Gen are super smart and still own the gym with us today.) We paid ourselves consistently that year, but Angie and I were the only full-time owners. We had a full-time office admin also, but our real goal was for Justin and Dustin to go full-time at the gym in 2015.
While our books said we could afford it, our bank account felt empty at the end of every month. In fact, we just got used to getting paid on the 5th after tuition had deposited into our account. Our CPA would write our checks for the 1st of the month, and she even commented once that it was strange none of us ever cashed until the 5th (no it wasn’t!)…
Sitting in her office I felt the tears start to take over. I was so frustrated, I could barely speak. If she had told us we did “OK” that year, I would have agreed. So, we knew it was time to put some major systems in place.
One of those was a cash management system. We were past the days of a cash box and counting quarters back to people. I wanted to know what was selling and how much cash we were bringing in each night.
The reality too was – what went in the cash box was never properly accounted for with the state of Missouri or IRS, and we knew that was wrong…we just didn’t know how to fix it.
The fix was easy. I drove over to Office Depot and bought a cash register. It wasn’t easy to learn, but I pulled out the Casio how-to guide and taught myself. Then I taught a staff member. We made a report she had to pull at the end of every night that told me how much we brought in via Jackrabbit, how much via Square and how much cash. She’d keep a copy of every receipt on a sketchy nail (sort of like at restaurants) and she’d staple them to her report at the end of the night.
I’m not saying this is the way everyone should do it. I am, however, saying that everyone needs a cash management system. Whether you input every dollar into Jackrabbit or you use the Square POS system with the register (which is what I have today that I love), you need something that makes it easy for customers to make a purchase with cash, get a receipt, and easier for you to report it. I can log into my system from anywhere in the world and see what our sales were for the night, the week, the month or even the year.
Cash management systems:
- Keep your employees honest
- Keep your employees detailed (even if totally honest, we all miscount at times)
- Keep you from pulling unaccounted for dollars to spend at Walmart without a receipt (this is why my books looked so great in 2014 and I didn’t have a dollar to my name.)
- Keep you legal as you know how much to report for taxes.
- Makes it easy for you to track your revenue
So, whatever you use, find something easy to account for every dollar that comes in the gym. Whether you’re logging every purchase of water into Jackrabbit or buying a Casio cash register (not even sure they still sell them), create a method and stick to it!
