There are many different third party point-of-sale (POS) systems that are used to collect payments from customers or manage orders. Whether you use Harvie, Square, GrazeCart, Barn2Door, or another system, we can help you get the transactions on your ledger tagged to the right categories and enterprises in Ambrook.
Getting Started
Before allocating your income, you’ll first need to identify your income categories. This will help determine what sources of data you need to be able to properly allocate your income streams. There are few questions to consider as you get started.
How do you sell products? What third party applications do you use to make these sales?
For any third party, you’ll likely need to extract reports from these platforms to get the data you need.
How do customers pay you? Do payments go through the same third party applications, or do you receive cash / checks?
If you receive payments via direct deposit from third party applications, the transactions will show up in your ledger. If you receive cash or checks, these will show up as deposits in your bank account, but may not be associated with the channel you sold from unless you tag them.
What fees are included in the price you charge to your customers, and what is taken out as part of the sale?
Deposits to your account from sales are often net of fees. To get an accurate picture of your gross sales, you’ll want to understand any fees charged when customers pay you.
Components of your payment
In most POSs, you’ll see payouts come into your bank account periodically. These payouts might include a few different components:
Gross sales: the total amount of product you sold over a given period of time.
Fees: most POS systems charge a fee for each transaction.
Credit card fees: in addition to fees charged by the POS, you’ll likely have fees for any credit card payments you receive.
Payment type: in some cases, you might receive cash or checks on top of credit card payments. These deposits will likely come into your ledger without indicating they’re coming from the POS. Seeing reports of sales by payment type can help you keep track of these different sources.
Taxes: these will likely be charged to customers at the time of sale.
Discounts, refunds, or tips: you’ll also likely have customers who request a refund or receive a discount on certain products. This data is also likely stored in the reports the POS provides.
This information will help you to figure out the category in Ambrook - in other words, which part of the payment was income or an expense? To accurately report your gross sales and fees on your tax forms, these pieces are critical.
Enterprise analysis
On top of understanding how the money you receive breaks down between income and expense categories, you’ll also likely want to use your sales data for enterprise analysis. Breaking out your sales by the types of income you receive - like vegetables, pigs, and beef - will allow you to understand how each of your enterprises are performing. Most POS systems have “categories” or “products” that you can link to your Ambrook enterprises. It’s useful to keep these consistent between the two systems as much as possible to make it easy to translate the sales details in your POS system to your Ambrook data. A few examples include:
Square has categories that can be customized based on what you’re selling.
Harvie has custom categories that tie products to a category that you define.
GrazeCart has an accounting ID that can be configured to map to your enterprises in Ambrook.
Configuring each of these directly in your POS will make it easier to translate your sales data into enterprise analysis in Ambrook.
Allocating your sales data with Ambrook
Many POS systems have multiple reports that help you get the breakdown of (1) what you were paid; and (2) what customers paid for. We recommend using the following process monthly or yearly to allocate your income:
Configure your POS system. Leverage categories available in your POS to categorize products according to your Ambrook enterprises or income categories. If you aren’t able to do this in the POS system, map the products in your POS to your Ambrook tags in a spreadsheet.
Download report(s) from your POS. These generally come in two different parts: (1) a breakdown of the payment you received between fees and income; and (2) a summary of the products that were sold. We recommend doing this on a weekly, monthly or annual basis depending on how often you want to review your sales breakdown.
Share with the Ambrook team. We’ll help verify that the reports match what we see in Ambrook before you start doing any categorization. We’ll also create a template that will help you tag your data in Ambrook in the future.
Tag your income. Select all the transactions in a month or year and apply the splits from your template to all the transactions.
Additional considerations
There are several things to keep in mind when determining how to leverage your sales data to categorize income and fees in Ambrook:
How you structure payments: if you operate a CSA, you might receive payments upfront for products that are delivered throughout the year. You may want to base your categorizations over the entire season to reflect that the payments you receive from the POS happen at a different time than when you deliver the product.
What you want to use your data for: you can apply the allocation at the frequency that makes sense for your business. If you want to compare your enterprises for the entire season, do the allocation once a year to simplify your bookkeeping. If you want to know differences across months, then apply these splits on a monthly basis.
We recommend talking to your accountant about your income streams and POS platforms to make sure you are tracking and categorizing the right things.