Every business cycle is a roller coaster of highs and lows. While sometimes its performance peaks, other times a slump can lead you to question your efforts. Such is the case with businesses in the hospitality industry as well.
From food and beverage businesses to travel and transportation enterprises, every business rises and falls at some point. However, its the resilience that matters, and that can be used once you identify the loopholes and prepare a plan to resolve them. These loopholes are called challenges and require your attention right from the get-go.
To be precise, you are bound to face the challenges of financial management no matter how small or large-scale your business. They come in different ways and you have to be familiar with each of them.
Exploring Financial Management Challenges In the Hospitality Industry
You will find various setbacks on your road to success. The hospitality industry is a diverse one and it brings you numerous challenges to deal with. Here are a few of them to make recognizing them easier.
Maintaining Error-Free Data Across the Business
With the extensive volume and thick clusters of financial information present in a hospitality company’s database, the margin of error is huge. Your accounting team can put all their blood and sweat in to ensure transparency, but you can never downplay the probability of human fault.
Even the biggest organizations find their accounting teams being troubled while trying to maintain fault-free data in their systems and protect their confidential information. In fact, bigger the organization, the more complex its financial management.
Henceforth, automation becomes a necessity. You have to implement practices and systems that can bear all the burdening workload and match pace with the plethora of intercompany transactions. And, that too while avoiding any delays.
To make the right decisions, you must understand that data authenticity and reliability are key. They are vital to ensure effective strategy-building and push your business towards growth.
Moreover, it can be seen that, over the years, data breaches and audits consume a mammoth amount of time. They cause a delay of weeks and months while impacting your productivity in negative ways.
However, the good news is your hospitality company can swamp this challenge by digitizing their financial systems. You can incorporate several mechanisms to maintain well-protected and dependable data across all departments and platforms.
Compiling Financial Statements
To enforce compelling financial management in your business, your accounting teams must be extremely robust in producing consolidated financial statements that give your management a comprehensive and clear view of the company’s overall progress.
Operating your business in the ideal conditions takes much effort and your accounting teams might encounter numerous hurdles on this road. One of them is consolidating financial statements on a uniform platform as data access for all entities, and stakeholder groups might be difficult to be provided.
To be specific, the reports might be forwarded in improper ways in the form of emails, excel files, and more. Such occurences make it tough to acquire critical data. However, it can lead to highlighting fraudulent activities and data manipulation. It helps parent companies attain a coherent look of their financial processes.
To cater to this issue, you must invest in a standardizez accounting system that holds expertise in consolidating financial statements. These software devise a strong financial foundation that leads to sustainable improvement when it comes to resolving the challenges of financial management.
Compliance
Out of the many important factors ruling the hospitality industry’s financial management, data governance along with global compliance rank the highest. Every franchise works under a set of different rules and conditions that direct its accounting practices. And well, every company aims to stay updated with the constantly changing regulations to ensure compliance.
However, these rules can test even the most productive teams, especially when your accounting teams must ensure compliance with a diverse task list. It includes recurring revenue and the financial consolidation of considerable forums to lease accounting standards.
Without a shadow of doubt, it is a daunting phase. Ensuring compliance in so many areas can be quite demanding. Henceforth, you should nominate team associates to fulfill these requirements, inform and update the team on every change, and rewrite the policies concering data management to avoid the hefty fines.
Managing Obsolete Financial Management Systems
The battle to attain financial transformation is common in the hospitality industry. From small-scale companies to the most well-established enterprises, every player in the hospitality industry has its challenges facing financial management.
In the efforts to introduce swift workflows and substituting legacy with, on-premise mechanisms with more detailed financial management systems, a lotof planning goes down. Moreover, the rising failure rate of this transformation makes accounting teams quite reluctant to experience the disruption.
Furthermore, numerous issues emerge due to the changes taking lace in a silo; there is no effort invested toward expanding the scale of this transformation across the entire company. When a company-wide exertion is missing, that is where problems occur.
However, NetSuite allows you to sort through all these issues and get a prized mechanism solving your financial management issues.
NetSuite ERP for Financial Management
NetSuite financial management effortlessly combines with NetSuite’s order management, stock, CRM, and ecommerce features to simplify all your critical business functions. They mainly include quote-to-cash which allows everyone to operate from a single source of sales,, finance, and customer information.
- It helps you explore beyond just numbers and access real-time insights to enhance business progress.
- It assists in closing quickly and generating financials reports faster and with precision.
- It supports synchronization of complex procedures from order processing to revenue recognition and more.
- It integrates every stage of your business operations including planning, forecasting, and budgeting.
