Keeping accounts with your supplier

A shop usually has several suppliers rather than one: fabric from one, thread and buttons from another, packaging from a third. Settlement with each runs on its own timetable and terms. If everything is written in one shared notebook, then when payment time comes nobody can say exactly how much you owe a given supplier. You either overpay or leave a debt unpaid in time, and trust suffers. The fix is a separate account sheet for each supplier.

One formula for every supplier

For each supplier record three movements in your table: what was received, what was returned and what was paid. The debt works out as: debt = opening debt + goods received − goods returned − payments made.

For example, at the start of the month we owed the fabric supplier 2,000,000 so'm. During the month we received goods worth 14,800,000 so'm on 5 delivery notes, returned one faulty roll worth 600,000 so'm and paid 10,000,000 so'm. The month-end debt is 2,000,000 + 14,800,000 − 600,000 − 10,000,000 = 6,200,000 so'm. If every line carries a date and a document number, any figure can be checked in a minute.

Settlement starts at receiving

The size of the debt is formed at receiving, so the most important check happens right there. Compare the quantity and price on the note with what actually arrived, and if goods are short or damaged, mark it on the note at once. Only then sign and book the goods in. If a price differs from the agreed price list, settle that before paying; arguing later is far harder.

If goods go back, do not rely on a verbal agreement: write a return document and have the supplier confirm it. Otherwise, at reconciliation, they may say no such return happened and you will have no proof.

Reconcile once a month

Once a month send the supplier your figures and compare them with theirs. This is a reconciliation statement, a simple matching of accounts. If the numbers agree on both sides, you are done. If they differ, go through the delivery notes one by one: which document is on one side but not the other? The cause is usually that the supplier did not count a return, or your payment did not reach their account. Reconciling every month rather than at year end stops small gaps from becoming a big dispute. Prepare your side beforehand: filter the Excel table by supplier and pull out the month's totals for "received", "returned" and "paid". With three ready figures the conversation takes five minutes.

Payment terms and discounts

Agreements with suppliers usually include a payment term and sometimes a discount for paying early. Put these on the account sheet as separate columns: "due date" and "discount condition". Once a week go through the list and decide which payment comes first:

1. Overdue ones and those expiring in a day or two.
2. Those offering a discount, if the cash allows.
3. The rest, in due-date order.

At month end gather the debts to all suppliers into one list. That is the sum of your obligations and the basis of next month's payment plan.

Record prepayments (advances) separately too. If an advance has been paid but the goods have not yet arrived, that is not your debt but the supplier's debt to you. Do not mix them up.

Price history

The price of the same item changes at a supplier over time. If you record the price at every delivery, at month end you will see which items have risen and which supplier raises prices most often. That becomes your main argument in the next negotiation. When you notice a change, do not forget to update the selling price on the shelf as well.

Conclusion

Accounts with suppliers rest on three simple actions: checking at receiving, reconciling monthly and keeping a separate sheet for each party. This routine gives you control of your debts and leaves the supplier with the impression of a serious partner. If your stock balances and supplier accounts have already got tangled, the AniqHisob team can run a stock count, help restore your stock records and set up a receiving routine.