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Bakery Bookkeeping Software: FreshBooks Review


Does This Bakery Bookkeeping Software Really Do What A Bakery Owner Needs?

In today’s post, I am reviewing FreshBooks accounting software to see if it is a good fit for the bakery bookkeeping needs of home bakers, cake decorators, and bakery start-ups.

Just so you know, this site displays affiliate links. This means that if you click a link and purchase something it may result in a small commission for me. My commission helps make this blog possible by covering blogging related expenses.  It doesn’t cost you anything extra and the decision is yours.  Whether or not you decide to buy something that is completely up to you.

What do bakers say about their bakery bookkeeping?

Have you ever felt like avoiding your office simply because you were so far behind with your bakery bookkeeping that you couldn’t imagine ever getting caught up? If that sounds like you then keep reading. It can be tempting to put off the “office work” when you are hands-on, in the kitchen for most of your day. You are not alone. Listen to what other bakers have to say about bakery bookkeeping.

I have been making birthday cakes for a number of years now, and I would like to start selling them. I have no clue where to start with the billing paperwork.

and . . .

I always need bookkeeping help! I am all thumbs in this department.

or . . .

“What can I do to keep from falling behind on bookkeeping?” 

and . . .

Invoicing weddings, sending out cake estimates, and collecting payments involves so much drama!

I understand bakery bookkeeping because I’ve been there

I used to dread invoicing because it can get so complicated. Meeting with brides for wedding cake consultations would go something like this:

  • hand price estimates
  • file away their paperwork while they thought things over
  • find the paperwork again when they were ready to book with me
  • take a deposit
  • make last-minute guest count changes
  • take partial payments
  • send out multiple reminders
  • sometimes even charge a late fee

And, I would put in all that time before even starting the actual wedding cake!

God forbid, if they would call or come in to make a payment when I wasn’t there because nobody but me could understand the complexity of the invoice!

I love finding and sharing things that will make bakers and cake decorator’s lives easier

 I was really excited when I learned about this online accounting tool called FreshBooks. If this is going to make paperwork more manageable, help with invoicing, track deposits and payments made, and save bakers valuable time, then I can’t wait to learn about it.

Lets take a look at the features that it has to offer and how FreshBooks can work for a home based cottage baker,cake decorator or a bakery shop owner.

Can FreshBooks help me work smarter, not harder?

Bakery Bookkeeping Image

We’ve all heard the saying “work smarter, not harder.” I think this is especially true for bakers. Because we are managing our own time and not really “clocking in” for shifts, it can be easy to work longer and harder than usual getting things “just right”.

But being your own boss means looking for ways to be more productive, so let’s see how this bookkeeping software can help with that.

Spend less time sending out estimates

One of the first things I noticed about FreshBooks was how easy it is to create invoices. You can literally create and send an invoice in about 30 seconds, and you can even send them right from the app on your phone.

Click below to see what the invoice looks like. You can also create and customize a trial invoice through this link.

FreshBooks Invoice Templates

Manage your expenses on the go

FreshBooks has an app that lets you scan receipts and immediately categorize your expenses. You can actually add and categorize your receipts before you leave the store!

And if your expenses are billable (like cake flowers, for example), it will add them directly to the invoice. No need to save old receipts. Freshbooks attaches an image of the receipt to each expense entry.

  • Take a picture of your receipt
  • Choose your expense category
  • Choose to make it a billable expense

How does this software handle complex bakery bookkeeping?

When I worked as a cake decorator,  I based my custom cake pricing on a simple model: I charged a base price for the cake and a fee for the extra decorating time involved. Let’s see if FreshBooks has a way to create an estimate and an invoice for this type of scenario. 

Time tracking

When I quote cake prices to customers I usually estimate the time that the cake will take. I want to give a quote for what I think this cake will cost, so for this estimate, I created a time tracking for 1 hour of additional labor. (When I set up my account I customized my own hourly rate)

FreshBooks bakery bookkeeping screenshot

Creating estimates

The next thing I did was to create an invoice. Easy enough. I set up the software with my different cake sizes and plug them into the invoice, and did this all from my phone. Surprisingly, it is a very user-friendly app!

Partial payments and discounts

After I quote the cake price estimate and the customer decides to book with me, they put down a deposit. So I accept a partial payment for the estimate and gave her the discount that was offered as part of my bridal fair promotion.

Split Payments

Now my client wants to split the balance into two payments. I include the deposit as a partial payment and create a final invoice. I can send out the final invoice on my phone and have them pay the invoice before delivery, or pay on pick up in my shop.

FreshBooks bakery bookkeeping screenshot

No complicated math work required. Taxes, deposits, partial payments, and split payments are all easy to do!

Can this bakery bookkeeping software organizing expenses?

I mentioned the app that lets you scan in receipts, but let’s see what else can you do with FreshBooks to help organize your business.

You can create categories for your business that will help your accountant at tax time. They also have an “at a glance” feature that lets you see a summary of your spending.

Cost of goods sold

Your cost of goods sold is defined as anything that is used to create or produce the items you sell. You can scan your receipts for:

  • Ingredients
  • Paper goods like cupcake or sheet pan liners
  • Packaging
  • Ribbons, labels etc.

Rent and Utilities

I like the “Remembered Vendors” feature that lets you enter your recurring expenses quickly for monthly bills like:

  • Rent
  • Electricity
  • Phone
  • Gas
  • Internet

Set up your entire chart of accounts with FreshBooks

Most bakery and small businesses have a standard chart of accounts that your accountant will want to see. Get off to the right start by categorizing your expenses to include everything from the beginning.

Easily set up and view expense categories for:

  • Equipment and Supplies
  • Marketing and Advertising
  • Licenses and Permits

Oh, I almnost forgot to mention that you can easily share access to your online books with your accountant at tax time!

Can FreshBooks help me look professional?

FreshBooks has an easy to use features that give your invoices the look of a big-time bakery. Baking and cake decorating are detail-oriented and visual art. It makes sense that we love our logos and our colors! Make sure you have a consistent brand image throughout all your communications.

Can I add a logo?

Make your baking business look professional with your logo on all your invoices. When you set up your account you can upload a JPEG.

Here’s a Tip– You can design your logo on Canva. Its free for most features, but if you want to upgrade just to set up your brand and design your logo, you can go back to the free level after!

Here’s a link if your need it. Try Canva for free.

What about my branded colors?

You can enter your hexadecimal number ( that six digit number you enter to get the exact color you want) so that the graphics elements of your invoices are consistant with your brand.

Can this bakery bookkeeping software help me get paid faster?

FreshBooks has different options available to get you paid faster. Whether you invoice your customers, or accept credit cards by phone, online or in person there is a a feature for you.

Payment option built in to invoice

FreshBooks has a super convenient feature that allows your customers to pay their invoice right inside of the invoice email. You will need to have a Stripe account to transfer payments to your bank account, and the fee for Stripe is 2.9%. plus a $.30 transaction fee. Although, that’s pretty standard in the credit card processing world.

For the full details on FreshBooks pricing plan, click here

FreshBooks Pricing

Advance Payments lets you enter credit card number by hand

If you take orders over the phone, they have an Advance Payment option that lets you enter credit card numbers for:

  • online orders
  • phone in orders
  • in person transactions

These transactions get processed online and take about a day or two to get deposited into your bank account.

Downside: this isnt a point sale system

While FreshBooks does offer many different ways to get paid by your customers, it isn’t a traditional point of sale system.

If you have a storefront, this would not work for your cash handling needs. However, they do have a feature that lets you track non-invoiced income. You can enter cash sales or other income, here’s how:

  • Create a non-invoiced income
  • Choose a source
  • Select a category
  • Enter Amount, currency, and date

I like the “Other Income” tab on the dashboard that lets you see where your money is coming from.

Can I enter payroll expenses?

If you are at the stage of your business where you have employees or are ready to hire, congratulations! Expenses can get a little more complicated when you are tracking wages and salaries.

One downside about FreshBooks is that they do not offer payroll services. They do, however, contract with Gusto for payroll processing which can connect to your FreshBooks account.

Conclusion

I have to say, after being a QuickBooks user for many years, I was prepared to think FreshBooks was too simplistic. Actually, simplicity is my favorite part. Instead of getting distracted by the multitude of functions that other bookkeeping software offers, I can get in, and get out with FreshBooks. I also like that you pay by the month with no contract. That helps when you’re just starting and unsure of what your income will be month to month.

While I don’t think Fresh Books is a “one size fits all” accounting program, I I can see this working really well for bakery owners, cake decorators and cottage bakers who are in the early stages of their business.

If you want to keep things simple in the beginning, this software can meet all your needs. When you grow into a retail space you may need more support with payroll, merchant processing, and a point-of-sale system.

For home-based/cottage bakers, cake decorators, and small bakery business owners, I think FreshBooks is a win. I honestly wish I had something like this when I was just starting out!

You can try FreshBooks for free by using my link. Let me know in the comments what you think!



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