Meta description: You may know Microsoft Excel as one of the best data management tools in the market. But, the spreadsheet software can also help scale your business finances.
Microsoft Excel has taken the position as one of the most valuable tools in the computing world. Over 750 million people use the data analysis and presentation tool. The reasons for its popularity are many. Off the top of the mind is the fact that everyone can use it. That includes students, accountants, business executives, and those at home.
Excel is valuable, even for those who may have difficulties with math. True, in the beginning, it can be a bit daunting to use. But, all you need to do is familiarize yourself with the functionalities and formulas.
Our article explores how you can scale your business finances with Excel.
What Is Excel Used For In Business, and How Can It Help Scale Finances?
Microsoft Excel is a software application. It uses spreadsheets to store,organize or analyze data. The importance of Excel in business lies in its wide range of functionalities. You can organize information, analyze data, and generate reports. The visual cues like graphs are fantastic for presenting reports.
Data validation tasks are easy with the Excel drop-down list. This is especially important in financial analysis and modeling.
Indeed, each department in the company will find a good use for Excel. The sales team can create spreadsheets containing customer and lead information.
The marketing team can use the same for market research and analysis. HR can organize staff information in Excel spreadsheets.
On scaling business finances with Excel, we will consider some critical factors. These include:-
- Better efficiency, which leads to higher productivity
- Elimination of time-consuming, manual processes
- Better inventory management
- Better data management and reporting for sound decision-making.
Let’s look at the importance of Excel in business finances.
- Excel for Accounting
It would be easy to say that the biggest beneficiary of Excel is the accounting department. Up to 63% of companies consider the software a critical accounting tool.
Smaller businesses use Excel for bookkeeping purposes. In fact, for many, it is a standalone solution for the finance function. The spreadsheets are a fantastic database for storing financial data.
The teams can run queries on the data and do basic calculations with Excel. But there are tons of other interesting functionalities. VLOOKUP and HLOOKUP help with searching for specific data in the spreadsheets.
Pivot tables help with the organization of large data sets. Excel macros automate repetitive tasks, thus saving time and more. And there are more benefits of Excel for business finances, which we will look at in more detail.
- Spreadsheets for Data Management and Financial Projections
The spreadsheets in Excel are a fantastic tool for calculations and data manipulation. What you will realize is that the functionalities range from simple to complex. You can, for example, use it for day-to-day applications like recording sales.
The same applies to coming up with monthly budgets. Yet, you can also use Excel for complex tasks like financial projections. Financial modeling and analysis, for instance, help with business forecasting, budgeting, and planning.
- Data Analysis and Visualization with Excel
The finance department deals with a lot of information. Most of it is in the form of numbers. Now, imagine presenting the data as is to a roomful of executives. They would have a difficult time digesting the information.
With Excel, everything becomes easy. You can create dashboards, automate reports or integrate the software with other systems. With simple clicks of the mouse, the teams can put all the relevant information into one sheet.
The other alternative is to create a graphical representation of data. It breaks down the tons of information that would be hard to decipher into digestible bits.
Bar charts, line graphs, and pie charts are valuable for sales projections. It is easy to compare past and current trends to determine what the future looks like.
The company can then take the necessary steps to move in the right direction. Indeed, that is how Excel can help make business decisions.
- Inventory Management with Excel
Proper running of any business requires keeping a close watch on inventory. The inventory information always needs to be up to date. Imagine a customer asking for goods, only to realize that there are none in the store. You could lose customers because they can always opt to transact with another seller.
It is easy to keep track of inventory with Excel spreadsheets. All you need to do is create columns with the necessary information. These include stock and re-order levels. You can also include other details like BIN numbers, location, barcodes, and SKUs.
But that’s not all. You can connect a scanner to the spreadsheet. This will help with goods processing and tracking of deliveries. You get to know where the goods are at every point until they reach the customer.
Let’s say you are operating an eCommerce platform. Most website builders cannot manage large amounts of data. In that case, Excel can provide a viable solution.
All you need to do is export the data from the eCommerce platform into Excel. You can then use the different functionalities to manipulate or organize the data. Once you are through, simply import the data back to your eCommerce site.
- Task Automation with Excel
If you were to translate into dollar amount how much manual processes cost, it would be shocking. The business also loses in terms of efficiency and productivity.
The use of Microsoft Excel in business results in task automation. The teams can take care of manual tasks without needing to invest in expensive software.
We have looked at the importance of Excel in scaling business finances. You need a system that can help with data management and analysis. Report generation and presentation are easy with visual representations.
Graphs and visualizations make it easy to understand the data. The company executives can use the information to make important business decisions .
Another reason why Excel is essential is task automation. Manual processes are a significant financial drain on companies. Using Excel to manage some of the tasks saves valuable time and money.
To unlock Excel’s true potential for the business, consider enrolling for training. Online classes provide flexibility in scheduling, so no one needs to take time off work.