Transaction Management: What It Is and Why It Matters
As a business owner, you know that every penny counts. Because of this, it’s increasingly important to be smart about the business transactions being made – from inflows to outflows across customers, suppliers, and lenders. Business bookkeeping – alternatively known as Transaction Management – is the process of organizing and managing all transactions in a way that makes visibility effortless and decision-making easy.
In this article, we're going to explore the ins and outs of business transaction management, ensuring that you have the info needed to move forward on solid footing.
What Is Transaction Management, And Why Does It Matter?
Transaction management is the process of organizing and managing your business to make record keeping and assessment simple. The proper filing of documents over time will allow you to quickly recall info, assess trends, and make business decisions.
Below are a few other key reasons as to why business transaction management is so critical:
- It helps you keep track of money coming in and going out.
- It can help you identify and prevent fraudulent activity.
- It can help you save money on transaction fees.
- It can help you streamline operations and make your business run more smoothly.
As your business grows, so too will the volume of transactions needing your attention. By being smart about the way you manage these, you can aid in navigating the future with the help of detailed data on the past.
Setting Up Your Transaction Management Process
There are a few different ways to go about setting up a proper business transaction management system, but the most critical component is that you find an approach that works well with your current structure. Here are a few things to keep in mind as you look for the right transaction management system for your operations:
- Ease of use. You want a system that is easy to use and understand. Look for a system with a simple interface that you and your employees can learn quickly.
- Flexibility. Your transaction management system should be flexible enough to grow with your business. As your business expands, you'll want a system that can handle more transactions without breaking the bank (or limiting functionality).
- Security. Make sure the system you choose is secure. Look for features like data encryption and fraud detection to keep your transactions safe from start to finish.
- Customer Support. When something goes wrong, you want to be able to reach customer support quickly. Look for a transaction management system that offers 24/7 customer support in case of any problems.
- Pricing. You'll want to find a system that fits within your budget. Look for a system with a pricing structure that makes sense for your business.
It’s important to note that committing to the wrong transaction management system today can cause some pretty significant frustrations down the road, and so we encourage you to take as much time as necessary to ensure that you’re committing to a system that aligns well across these various fronts!
Transaction Management Challenges
While transaction management can save your business major time and money over time, there are a few challenges that come with the territory. Here are a few of the most common challenges faced by businesses navigating the space:
- Compliance. A major challenge faced by businesses is compliance. When you're dealing with financial transactions, there are a lot of regulations you need to follow. Make sure the system you choose can help you comply with all the relevant regulations.
- Implementation. One of the biggest challenges with transaction management is implementation. If you're not careful, it can be very difficult to get your employees on board with a new system. Make sure you take the time to train your employees and help them understand how the system works before you try to implement it.
- Customization. Each business has its own set of unique needs – especially when it comes to transaction management. Ensure that the system you’re enabling is capable of being customized to address your specific needs, otherwise discomfort and frustration may not lie very far ahead.
Although every new system will come with its own set of challenges – that’s simply to be expected – it’s important to carefully consider the above items and progress forward with a focus on sustainable, value-adding solutions.
Making The Most of Your Transaction Management Approach
There are a few things every small business can do to make the most out of their transaction management system. Here are a few tips:
- Train your employees. One of the most important things you can do is train your employees on how to use the system. Make sure they understand how it works and take the time to answer any questions they have.
- Set up rules and regulations. Another important thing to do is set up rules and regulations for how the system should be used. This will help ensure that everyone is on the same page and using the system correctly.
- Stay organized. It's also important to stay organized when you're using a transaction management system. This means keeping track of all your transactions and making sure they're properly documented.
- Monitor your system. Finally, it's important to monitor your system regularly. This way you can catch any problems early and make sure your system is running smoothly.
Transaction management can be a complicated process, but operating with care will be important to guarantee long-term success and stability. If the task at hand has become too large to manage, fear not. Our team at ParallelCFO was built to help small businesses with their transaction management and bookkeeping needs, and we're well prepared to help you navigate the choppy waters ahead.
From simple data entry to advanced insights and guidance, we'll support you each step of the way. Contact us today to learn more about our team, services, or to chat about bookkeeping at your company!