Bookkeeping for independent retailers is crucial. It’s the key to understanding your finances, making smart choices, and pushing your biz forward.

Today, I’m sharing six bookkeeping tips from a recent live lesson I taught to Master Shopkeepers. Read on to learn what you need to do to keep your books in order so you can work smarter, profit more, and grow. 

#1. Separate Your Business Finances From Your Personal Finances

Your personal finances and business finances should not mix, ever. We’re too inundated, overwhelmed, and busy to sit there and try to separate personal from business! 

Instead, let’s make it super clean and simple from the beginning. You need separate bank accounts, debit cards, and credit cards—and you need to use those tools for the correct expenses, without any gray area or comingling of your finances. 

Bookkeeping for Independent Retailers

#2. Consider Working With a Bookkeeper to Understand Your Numbers Better

While I’m not opposed to DIYing your bookkeeping, working with a bookkeeper can be incredibly helpful. 

If you’re not comfortable reading your Profit & Loss statement, struggling to show a profit, or drowning in cash flow issues, hiring a bookkeeper to walk you through your numbers will make a big difference.

Inside the Lab for Master Shopkeepers, there’s a resource with a list of questions to ask potential bookkeepers during your interviews or hiring process. Your bookkeeper does NOT need to be a certified public accountant (CPA), but that extra level of expertise can be helpful. 

No matter who you hire as your bookkeeper, though, I highly recommend checking their work each month. Bookkeepers are human, and they sometimes miscategorize expenses that aren’t clear. 

For example, an expense from a home and garden store might seem like a “repairs/maintenance” expense, but for a retail store, that expense could be a “cost of good” if you were buying items that you’re re-selling at your store. 

Additionally, take advantage of any monthly check-in call your bookkeeper offers. That way you can communicate with them about your expenses.

If you need a recommendation for a bookkeeper and you’re in Master Shopkeepers, just search for “bookkeeper” in the Facebook group—there are tons of posts about great bookkeepers who understand the nuances of indie retail businesses. 

There are also resources inside the Lab for Master Shopkeepers to help you DIY your bookkeeping if that’s what you’d prefer. These include a bundle of worksheets with a checklist of what to do each month to record, categorize, and balance your expenses. 

And if you’re not in Master Shopkeepers, apply to join us! It’s our territory-protected retail training mastermind that includes a vault of resources, detailed business lessons, and a supportive community of your fellow indie retail store owners. 

With monthly coaching calls, exclusive classes, and an ultra-engaged private Facebook group, you’ll have all the support you need to work smarter, profit more, and grow your retail business. 

Bookkeeping for Independent Retailers

#3. Choose the Right Bookkeeping Software

I’m not an expert on bookkeeping software, but I do know that choosing one that works for you and your brain is crucial. 

Many members of Master Shopkeepers use QuickBooks because that’s what a lot of bookkeepers and accountants prefer. Others use Xero or Wave. 

Once you’ve hired a bookkeeper, ask what software they recommend and if they can offer you some initial training on how to use it. Getting involved in and learning about your financials—even if it feels uncomfortable!—will help you grow your business and as a business owner.

#4. Learn the Difference Between the “Cash Basis” and “Accrual Basis” Accounting Methods

The difference between “cash basis” and “accrual basis” accounting comes down to when you record your revenue and expenses

If you’re recording revenue and expenses the moment you receive or spend money, it’s cash basis accounting. If you’re recording when you send an invoice or get a bill, it’s accrual basis. 

Inside the Lab for Master Shopkeepers, there are several modules about understanding your independent retail store’s financials, including how to choose the appropriate accounting method. Check out those lessons to learn more, or ask your bookkeeper for guidance.

#5. Create a Simple Chart of Accounts for Your Retail Store

When you categorize your business expenses inside of your bookkeeping software, the overarching categories of expenses are placed into a Chart of Accounts (COA).

Oftentimes, the COA inside your bookkeeping software is a boilerplate version that fits most (but not all!) businesses. Retail businesses have unique needs, so don’t be afraid to rename or customize your COA in a way that makes sense to you! 

You can also ask your bookkeeper for guidance on naming the accounts on your COA in a way that’s easier to understand.

Bookkeeping for Independent Retailers

#6. Become Familiar With Your Profit and Loss Statement

Your bookkeeping software can generate a Profit & Loss Statement, or P&L, for each month. There’s also a yearly P&L that summarizes where your money went over the entire year. 

Knowing how to read your P&L will give you a much deeper understanding of your business finances. That understanding is crucial in making informed decisions for your store.

Bonus Tip: Don’t Beat Yourself Up if You Don’t Have a Handle on Your Business Finances Just Yet

Tax season is just around the corner, and yes, it can be stressful to suddenly face your numbers. But that’s not an excuse to be cruel to yourself over your current level of financial acumen. 

I know how easy it might be to give yourself a mental beatdown for not understanding your business finances. Trust me, I’ve been there! But if you’re able to take any of the steps above—especially hiring a bookkeeper, if possible—then you’ll be empowering yourself to better manage your money going forward. 

Plus, imagine how incredible you’ll feel next tax season if you set yourself up for success this year.

If you’re in Master Shopkeepers, you already have access to tons of resources to get you started with understanding your numbers. Visit the Lab to dive in. 

And if you’re not in Master Shopkeepers yet, apply to join! You’ll not only get all of those incredible resources, tools, and lessons, but you’ll also become part of an engaged and supportive community of other indie store owners at all stages of retail business ownership.



  • [04:11] #1. Separate Your Business Finances from Your Personal Finances
  • [06:20] #2. Consider Working With a Bookkeeper to Understand Your Numbers Better
  • [18:15] #3. Choose the Right Bookkeeping Software
  • [21:20] #4. Learn the Difference Between “Cash Basis” and “Accrual Basis” Accounting Methods
  • [23:27] #5. Create a Simple Chart of Accounts for Your Retail Store
  • [24:51] #6. Become Familiar With Your Profit and Loss Statement
  • [26:03] Bonus Tip: Don’t Beat Yourself Up if You Don’t Have a Handle on Your Business Finances Just Yet

Connect With Kathy

Kathy Cruz is an Independent Retail Coach who helps store owners work smarter, profit more, and grow their brick and mortar businesses. 

Connect with Kathy and learn more here:

Instagram: @savvyshopkeeper
Mastermind Group: Master Shopkeepers

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