Financial Tools for Agencies

Simply put, the agency business is about selling services, products, or expertise and labor. Agencies forecast expenses, create proposals and invoices, and track time to determine actual costs.

This article is about financial tools for agencies and how you, as an agency owner, can map out the complete workflow from proposal creation, through invoicing, VAT advance returns, to liquidity planning for the coming months or years.

Proposal and Invoice Creation

Typically, every project begins with defining the tasks, often documented in a requirements specification or briefing. With these descriptions, you, as a potential contractor, can create a proposal. This proposal is presented to the client, and once confirmed, the project can begin. Ideally, you use an accounting tool for proposal and invoice creation that supports you in creating documents and managing the approval process. Since your invoices are part of your accounting, it makes sense to create them directly in an accounting solution or generate them directly from proposals.

Our Recommendation: SevDesk

SevDesk is the leading German accounting tool and can be recommended without reservation. With SevDesk you create proposals that you can send directly to clients. From the proposals, you can directly create invoices. These can be, for example, installment payments that refer to the respective proposal. Of course, you can also create standalone invoices.

Screenshot: SevDesk

• Receipts sent to SevDesk are automatically captured and categorized
• You can create your VAT advance return with SevDesk and submit it to the tax office
• If you connect your business account with SevDesk, invoices and receipts are automatically matched to bank transactions

Excellent alternatives: Lexoffice, Buchhaltungsbutler

Project Management & Time Tracking

For managing your projects, there is a huge selection of tools. Since every agency works slightly differently, it is difficult to clearly distinguish individual requirements. It is best to compare solutions on specialized portals like agentur-software.work or OMR.

An agency software should fundamentally be able to do the following:

• Operational management of your projects: Task management
• Communication
• Time tracking
• Project planning / Resource planning

Nice to have:

• Workflow automation
• Customer management / CRM
• Analytics and tracking software

Often, agencies use multiple solutions for this variety of tasks, since all-in-one solutions do not meet requirements when things get specific. Here you can find a good summary of all-in-one agency solutions: Best Agency Software.

Liquidity Planning

Many agency owners who do not use smart liquidity planning do the following:

• Rely on their gut feeling – When agencies reach a certain size, it becomes negligent to rely on your gut feeling about whether there is enough money in the business account. This can quickly lead to a precarious situation.
• Keep enough money in the business account so there is never a shortfall – This makes investments difficult to realize. You should put your money to better use, even if it is just an exciting side project.
• Do liquidity planning with Excel – There are great solutions for this, but they are often complex, need to be regularly fed and maintained, and can often only be operated by experts.
• Rely on their financial advisor or tax consultant – Individual financial consultations are expensive, but a good choice if you want more than the usual business assessment from your tax consultant.

Our Recommendation: finban.io

finban is currently the only liquidity planning software that specializes in agencies. With finban, you can not only plan your liquidity effortlessly, but you also gain insights into your agency KPIs.

Screenshot: finban.io