Do you have the visibility into your financials that would tell you if your Overhead was too high (if it's not 20 to 25 percent of sales, it's too high)? I've been using personal budgeting software for many years to provide me with that visibility into my business account (first with Mvelopes, and up until recently YNAB, but since version 17 of Odoo was released, I have been using their Analytic Plans, Accounts, and Distributions to provide that same visibility). When using personal budgeting software, I had to do double entry, but the ability to look into the future as to how I would spend my resources, and the ability to have virtual envelopes/buckets/baskets/shoeboxes was well worth the effort.
With the version 17 upgrade of Odoo, these analytic tools allow for the same visibility, and the same virtual envelopes with none of the redundant double entries (you can look at the same pile of money in as many ways as your imagination can think up). If the Profit First System is calling your name, Odoo enables that system with little to no extra work, and if you are a disciplined person, only one bank account (Mike Michalowicz would say blasphemy to that).
For me, escaping the QuickBooks ecosystem was the driving force behind my switch to Odoo, however, replacing WordPress and WooCommerce with Odoo was a very BIG bonus. I am going to put an image below with the distributions I have used with a couple of cabinetmakers so you can get an idea of what these virtual envelopes would be called, and what percentage of each deposit would go into which envelopes (these percentages change with different levels of sales).
Think of the Materials-Payroll envelope as a virtual escrow account (that money was never yours to start with, it was your vendors and team member's money).
If you ever ask yourself, "I wonder how much of the money in my bank account is mine to spend?", this view of your financials can answer that question 24 hours a day.
The feedback loop that comes from having to move money from your Profit, Owners Comp, or Owners Tax folders to pay Materials, Payroll, or Overhead bills reveals your OVERSPENDING in a very tangible way. Using this system will ultimately eliminate the deadly game of paying Project A's material and labor bills with Project B's deposit check, and gives you the best shot at long-term success.
