Small business 101: Using tech to manage your company's finances

This story is part of a series about financial literacy for small businesses in the Ypsilanti area. It is made possible by University Bank.

When Peridot Burke opened Gemstone Nails in Ann Arbor in 2018, she found herself wondering how to most effectively manage her company's finances. Like many small business owners, she decided to turn to technology. It was a decision that she and other local experts say could be invaluable to a company's success. 

"I'm the type that hates technology. It makes me feel like the inside of my brain is having an electrical fire," Burke confesses. "But using it has made me fully financially literate about my business. It's given me literally 100% control in seeing how I'm doing, and where I can do better."

Burke chose to use the GlossGenius booking platform, which integrates scheduling, billing, and financial tracking. The platform's features include handling credit card processing, managing appointments efficiently, and offering business analytics. Burke pays $24 a month for the service. And, as Gemstone Nails is a bustling one-woman show, the benefits are twofold: GlossGenius offers a significant cost savings over hiring a receptionist or business manager, and it saves Burke valuable time. 

“If you can get over the initial fear of learning something new and the mild amount of frustration that comes along with learning a new system, you'll see there's all kinds of tools," Burke says. "If you find a big one, like a QuickBooks situation, or if you can get one with a tax finance-tracker linked to your bank account systems, it will make everything so seamlessly integrated."

Ben Bolen, a wealth advisor with University Bank in Ann Arbor, also feels positively about technology's place in small business finances.
Rickey PortisBenjamin Bolen.
"Software can intuitively link accounts to transactions and categorize accordingly. The categories can also produce charts and graphs, so you can quickly analyze your spending and earning behaviors to drive business decisions," he says. "These reports will be also used to file taxes, so it should be easy to pull and total properly categorized expenses." 

He adds that the more organized a business owner is, the easier it is for them or their tax preparer to file taxes. 

"Time is money, either for the business or for the tax professional, so using software can help with efficiency and reduce long-term costs, such as labor," Bolen says.

For small business owners using an analog system to manage their finances, there are two big reasons to shift from pen-and-paper to a tech-based solution. 

"Time and accuracy," Bolen says. "It takes a significant amount of time and energy to manually input every transaction such as receipts, payables, and receivables."

Angel Vanas, owner of the Ypsilanti-based Star Studio salon, is another small business owner who heartily agrees.
Doug CoombeStar Studio owner Angel Vanas.
"I don't have time to be doing stuff with pencil and paper. Absolutely not," she says. "Why would I spend my time doing that when there is software that can do that, and literal robots who will freaking help me? Plus, I am not a bookkeeping wizard. That's not my job. My job is to run a good team and take care of my clients."

Vanas shares that she "could not function like a modern business" without a tech-based scheduling system, which is also her payment system. She used such a system from the time she opened her salon eight years ago and has been learning about the benefits along the way.

"I'm actually far from being old-school with my company's finances. I no longer take cash because I don't want to [mess] with it," she says. "I got robbed once for my cash drawer and that was enough. We are all card, all the time, and technology helps me do that."

While Burke has embraced technology as a way to manage Gemstone Nails' finances, she does also use a pen-and-paper system. She jokes that that might be due to the influence of her parents, who still have all of their old checkbooks tucked away.

"I feel that if the internet went down, I would have something that I can look at right at that time," she says. "At the same time I've got my technology because, if a fire or flood happens, the IRS is gonna say, 'That's terrible, but you still need to file your taxes, right?'" 
Doug CoombeGemstone Nails owner Peridot Burke.
As Burke grows more comfortable with technology-based solutions, she’s not as concerned about the need for an extensive analog accounting system. She credits some of this growing confidence to her longtime friend Kate VanHorn, who is also a business owner and the financial advisor at Washtenaw Community College’s Entrepreneurship Center. 

“Small business clients usually have some sort of system, and it's usually working in some ways, and not in others,” VanHorn says. "Part of what I try to do is work with them to determine if they need a big, fancy technology platform, or if what they already have is working for them and their tax preparation process."

VanHorn explains that a lot of the work she does is backended on tax planning. Her experience has been that a vast majority of small business owners, especially in their first year or two, are not thinking ahead about how to file taxes. When tax time comes, they're missing a lot of records.

"We wind up talking a lot about how records are currently being kept and if a paper and pencil is working, if just a spreadsheet is working, or if they really need QuickBooks," she says. "Then it's about basically trying to custom match a business owner's area of strengths and what works for them already in their life, to what products are available."

She adds that there are lots of options for financial management technology. She's noticed a growing conglomeration of integrated app software instead of just stand-alone competitors to tools such as QuickBooks. 
courtesy Kate VanHornWashtenaw Community College’s Entrepreneurship Center financial advisor Kate VanHorn.
"What's really interesting is the way Salesforce birthed this whole variety of third-party app integration. Now a lot of organizations for small, small businesses are competing, or are modeling themselves after the Salesforce model," VanHorn says. "For example, the [customer relationship management platform] Zoho has an accounting plugin so you can actually run your whole business from one integrated platform."

Jordan Schaenzle, a managing partner of the Ann Arbor-based custom software company Atomic Object, speaks to another way small business owners could benefit from exploring technology. Schaenzle authors "The AI Reactor" newsletter, where businesses can stay up-to-date on the latest artificial intelligence (AI) developments. He shares that exploring and learning about AI is important, and many business owners are already using AI in some way without being aware of it. 

"Do a little bit of reading on the tools you're already using, like TurboTax or QuickBooks or Xero," Schaenzle advises. "Are there AI-powered features that you can unlock, just by upgrading your membership, that are going to save time and money?"

He explains that small business owners tend to be a bit more resource-constrained than large business owners, and they tend to "wear more hats." Proper time management is even more important, and this is where AI can be a business boon.

"You can really start to reclaim some of your life and some of your sanity, and focus your time on working on the things that really matter," Schaenzle says. "One of the things that AI opens up is a lot of potential for the ability to automate things and prepare responses and help us to learn new things."
courtesy Atomic ObjectAtomic Object managing partner Jordan Schaenzle.
An example would be looking at a company's cash flow. A business owner could ask an AI tool to create a template for a spreadsheet for managing cash flow, rather than spending all the time to make that spreadsheet themselves.

"Working with AI is going to be something that we're all going to have to get comfortable with, and that will mean different things for different people," Schaenzle says. "But it's a journey that we're all going to go on, just like, a couple generations ago, people went from not having ever used computers to having to learn. I think this is the new era that we're stepping into."

Burke says she can't imagine her company succeeding without technology. She advises any small business owner who is tech-curious to get on board.

"Every week I pass numerous farm stands owned by Amish. They're on Venmo and Cash App, baby. They're whipping out their phones and taking Zelle," she says. "In my personal opinion, from a larger standpoint, you cannot run a business in America without technology. Even the Amish can't do it."

Jaishree Drepaul is a writer and editor based in Ann Arbor. She can be reached out jaishreeedit@gmail.com.

Benjamin Bolen photo by Rickey Portis. Peridot Burke and Angel Vanas photos by Doug Coombe.