How to Use Mindbody and Xero to Increase Your Gross Profit
Mindbody is a business management software oriented towards the booming health and wellness industry. It is an all-in-one online software that not only tracks your sales but can be used for client sign-ups, a customer database, employee time tracking, and more. Not only does it track all of this but it supplies reports that can be used to analyze your sales to better increase profits.
WHY IS MINDBODY THE #1 SOFTWARE FOR GYMS, SALONS AND SPAS?
Need an easy way to track sales across multiple service and product categories? Mindbody’s there for you! Need a list of clients for your upcoming class? Just a click away! Need to track the effectiveness of marketing campaigns? You got it! Mindbody is perfectly catered towards the health and wellness industry to give you everything you need out of a point of sale system.
HOW TO SYNC MINDBODY TO XERO
Sadly, Xero and Mindbody no longer sync natively. You could use tools like QSS Connect, but that would come at an additional cost and would be unnecessary. You can easily get your sales into Xero in just a few seconds by following our steps below.
HOW TO MANUALLY RECONCILE MINDBODY WITH XERO
Mindbody has a number of reports regarding sales, customers, and employees. One of the best and most detailed sales reports in Mindbody is called the Daily Closeout. Although “daily” is in the name, this report can be run for any timespan. This report showcases all categories of sales, sales tax collected, any refunds, and all tender types used for making payment.
To get to the report, first log in to your Mindbody account and click on Reports
Then you will click on the Daily Closeout Report.
You will need to sort by the dates you wish to see the sales. Typically, we sort weekly or monthly- depending on how often our clients choose to work with us. Be sure that you click "include prepaid gift cards".
In this report, you first see the sales by payment type.
Next you will see your sales separated by category.
What do all these numbers mean?
You can see there are a few different sections of the report. First, you can see the breakdown of payment types between cash, check, credit card, and any other payment types you have setup. It will also show details on taxes, returns, and the quantity of items sold. This report is saying that you accepted the following payments:
$20679.50 + $5.16 (tax) = $20684.66
The second section lists all of your sales categories and also separates these into services (non-taxable categories) and products (taxable categories). This section is especially useful when filing sales tax. You can easily see your total taxable income, your deductible services, and the tax collected. You want to make sure you are recording your sales minus any refunds. The sales listed above are:
|Sales by Category||Amount|
If you had any returns, you would see this listed in the Returns column.
Now what do I do with all these numbers?
Entering the sales in Xero will take you less than 1 minute... I promise.
You will need to create a sales invoice in Xero that lists all of the revenue as positive numbers and the cash received as negative numbers. As more revenue is entered, your revenue will increase on your Profit and Loss. As more cash and merchant services is entered, it will increase the amount that is owed to you from the merchant service provider or the manager (who deposits the checks and cash in the bank), which is listed on the Balance Sheet.
When you see the deposits for cash and merchant services come through the bank account, you will simply reconcile those against their respective clearing accounts- Cash Clearing or Merchant Services Clearing. At the end of the month, the clearing accounts will net to zero, meaning all cash and merchant services has been deposited. If it doesn't net to zero it might mean that you have a cash discrepancy or your merchant services provider still has funds in transit.
You can speed up the reconciliation process by creating a one-time invoice and copying it each time you enter the sales or a repeating invoice that will do that for you automatically. You will just need to plug in the numbers for the current period.
Protip: Upload a copy of the Daily Closeout report on the invoice, so that you can refer to it later.
HOW DO YOU USE MINDBODY REPORTS TO BOOST YOUR PROFITS?
As you accumulate data into your accounting file, you can begin to see trends. Usually this takes about three months for trends to begin to present themselves and six months for data to gain some traction. Be sure that you are tracking revenue by profit center- for example, group or individual classes, membership income, supplement income, product income. If you want to get even more granular, be sure that your chart of accounts supports the level of detail that you desire. Take a look at these profit centers and see what is happening. Does the outcome match your business plan? Does one area of your business need a little boost? By looking at your financials on a month over month basis, you can take action quickly when things aren't going well. Leverage your Xero accounting file, instead of scratching your head at the end of the year.
WHAT OTHER REPORTS CAN YOU USE TO BOOST YOUR BOTTOM LINE?
- Last Visit Report – You can use the Last Visit Report to search for clients who have not checked in since a particular date. If a client is not using your facility, they are at risk of cancelling their membership. Perhaps you can send them a check-in email, or a coupon for a free shake at the juice bar. Running a successful gym is not just about current number of members, but maintaining and adding to those memberships for months and years to come.
- Sales Report – Although the Daily Closeout report is our favorite sales report for accounting purposes, the “Sales Report” can be more useful in the planning of your business. You can use this report to sort sales by employee, category, or location, which is especially useful when franchising. By viewing both summary or detail views, you can dig into what service and product categories are doing the best, or which may need a revamp.
- Payroll Report – Use this report to view your staff’s classes and sales, which will then be entered into your payroll software for payment. You can also run a report to view specific sales categories only, if wanting to compare the cost of specific classes being offered.
- Cancellations Report – Use this report to view cancellations made by clients or staff members. If you are seeing a large number of cancellations from specific clients or on specific dates and times, you can use this information to reach out or to change times and dates to those that may better suit your clients’ schedules.
- Attendance with Revenue Report – Use this report to look at specific revenue for each individual attendance. Mindbody explains this report’s use by stating, “For example, if a 5-visit card costs $45, then regardless of how many visits have been redeemed, the report will show you that each visit generated $9 ($45/5 visits = $9 per visit).”
- Autopay Detail Report – You can use this report to look ahead at scheduled autopayments. This can be useful to look at when during the month you receive the most income. For instance, you might be making $50,000 per month and have a budget setup to account for this. However, if most of this money is being deposited in the beginning of the month, it may give you a false sense of available funds.
- Retention Report – The retention report is great to use in conjunction with the Last Visit Report. Your gym may run a 60-Day Challenge and sign up 50 new members. Using the retention report after the challenge is over will show you how many of those clients decided to maintain their membership, or sign on for more personal training, and thus show you the success of the 60-Day Challenge campaign.
The above are just a handful of the reports offered by Mindbody. Mindbody is always adding value for their clients by adding new reports that help to tell the story of the business.
Want to learn more about how Mindbody + Xero can help grow your business?Setup a time to chat with us about how we can help you setup Xero and Mindbody successfully. No strings attached. :)
Updated: 06/10/2019 to reflect the changes to the Xero/Mindbody Sync