Why do retail financial reconciliation?

With the large volume of sales that is usually part of the daily life of retail companies, carrying out financial reconciliation is no longer an option, it is a vital duty for the business. All the company’s efforts to reinvent itself in order to remain competitive and serve increasingly demanding customers can go down the drain when financial management does not receive the attention it needs.

It’s not about dedicating days or weeks to this task. But to optimize time to make more complete analyzes and help in the decision-making process . Don’t forget: if it consumes a lot of your time, the cost involved is also great.

Carrying out and closely monitoring retail financial reconciliation can bring benefits to all areas of the business , not just the finance department. When your heart health is up to date, the whole body works better; the same goes for companies.

In this article, you will learn about the benefits that financial reconciliation can bring to retail.

What is financial reconciliation?

The entire flow of a sale involves a few steps until the customer’s payment reaches the retailer’s account. From authorizing the sale, processing the information and transferring the amounts paid, etc.

Financial reconciliation is the process of comparing internally and externally sourced records of financial transactions in order to identify manual errors , operational failures, deviations , inconsistencies and fraud .

The more manual and dependent on people this process is, the more challenging and complex it is.

Everything happens as a chain reaction: because they are not integrated, manual processes contribute to the loss of information, therefore, without a complete view of the financial reality, wrong decisions are made and more rework will have to be done. The team becomes unproductive, no matter how hard it tries to put to good use all the skills and knowledge it has.

It is difficult for companies, alone, to identify what needs improvement. The most common is to try to get rid of the symptoms of a bigger problem. For example, there’s no point in hiring more people if the tools given to them don’t help them use their full potential.

Why do retail financial reconciliation?

Automated financial reconciliation with Equals helps retail companies make their financial processes more organized, optimize time for data visualization and help managers to seize business opportunities. That is, the financial reconciliation shows what happens behind the sale and what steps need to be taken so that the company’s objectives are achieved.

1. Reinforces control over sales reconciliation

A comma or an extra/minus number when entering the amount in the card machine can compromise the result at the end of the month. Automated financial reconciliation helps eliminate inaccuracies that often occur due to manual work and operational failures, as well as errors that contribute to rework.

It is necessary to redouble the attention to the conciliation of sales because its bad management can compromise the company’s stock and the cash flow . Imagine that the sale has been made, but the transaction has not been recorded. The customer will have their product in hand, but there will be a lack of money in the retailer’s cash flow since the payment will not be made.

• Management of cancellations and chargebacks

With Equals, you won’t have to log into multiple acquirer portals to cancel sales. When performing the action within our platform, receipts are provided for each of the cancellations made.

Equals is the only card conciliator on the market with a cancellation reconciliation module. The shopkeeper can cancel the total or partial amount of a sale that has already been authorized before.

2. Improves the negotiation of deadlines and prices in the reconciliation of payments

Accounts payable control requires good relationships, business savvy and a lot of cash flow organization. There are many “plates to balance” when the scenario is that of a retail company. The large volume of data on liabilities that the company needs to pay can compromise meeting deadlines. This is the kind of task that needs automation. Not only to meet deadlines, but also to honor payments without the risk of not noticing financial inconsistencies.

3. Increases visibility of receivables reconciliation

In 2020 alone, Equals helped identify more than R$84 million in undue charges. These irregularities can be identified by reconciling receipts from the Equals platform. In a simple, fast, secure and automatic way, the retailer discovers whether the payment to the card operator was made.

It is possible to have the details of the sale on the discounts charged by the means of payment companies involved in processing the transactions. In this way, it is much easier to compare data and identify discrepancies that will reflect on the bank statement.

4. More intelligence in bank reconciliation

Financial reconciliation also helps to identify whether forecast and realized amounts in the retailer’s bank account actually match. With financial automation, bank reconciliation can be more efficiently tracked on a daily basis because it provides details on the cause of likely errors and promotes a faster reaction against fraud.

Even if it is carried out every day, it is important to have all the receipts and bank statements that will help the company to deal with adversities.