Xero’s Business Snapshot – A very useful tool

by | Nov 5, 2021 | User Guides | 0 comments

Xero Accounting software is an excellent tool that helps you get a bigger picture of your business’s financial health. Even if you are not an accounting and finance expert and starting a startup, this software will do wonders for you as it is easy to learn and understand, well-structured and user-friendly. By just a look at the dashboard, you get to see the most important numbers of your company. Also, the dashboard is perfectly editable, so you can prioritize the numbers and insights you want. You can organize them in your desired sequence and also add and delete things. It will allow you to generate some valuable reports. Xero’s business snapshot tool is one of the fantastic functions to explore, and we will tell you what it has to offer.

Through this tool, you can even you how much money you have, which you may want to invest later in real estate or cryptocurrency. Hence, Xero is a valuable tool for any business. You can read its introduction for beginners.

What is Xero’s Business Snapshot?

Xero Accounting Software has introduced many new features in recent times. It is to develop more helpful insights. One of their recently introduced feature we are is ‘Business Snapshot.’ So let’s talk about what is Xero’s Business Snapshot, how to manage its dashboard. And most importantly, what is it for? What is Xero's Business Snapshot?

Business Snapshot is a powerful tool, built in a dashboard style, to generate the overall financial health of any business. It includes visuals and graphics, and numbers to give a quick understanding of the situation. If you are a person of visuals, this feature will be fun for you. It is how Xero’s Business Snapshot looks like;

The dashboard shows actual numbers in a precise manner. Such as profit and loss, income and expense, cash inflows and outflows, and so much more. You can easily explain the numbers to your investors or accountants by using this tool. The reason is that it is well structured and easy to understand. You can also compare and contrast the data by selecting a period, for instance, Year to date, with the previous period. It will help you understand the salient points compared to the previous experience and may drive better solutions for the future.

Where to find it?

You can find this tool by going on to the main menu of the Xero software. Open the drop-down menu of ‘business’ and from there select ‘ business snapshot. For better understanding, the figure is given below;

Where to find it?

If you click here, your dashboard will open, giving you a snapshot of how your business is doing in a set period. The dashboard gives you insights on efficiency, profitability, account balances, and much more to know the financial situation.  But first, you have to set the period range. And for that, go on top of the page and click on Year to date. There will be the option of choosing data on a monthly, quarterly, and yearly basis. Or you can select the year-to-date option. You can also set whether you want the data on a cash basis or an accrual basis. It will show both the filters on the top of your dashboard. The figure is given below.

Where to find it?

Xero Analytics Plus

The advanced dashboard of Xero’s Business Snapshot is Analytics plus, which allows some fantastic features. But for this, you will have to buy a subscription. To do so, go to subscription and billing and choose your monthly plan. This tool will allow you to select custom dates for times other than yearly, quarterly, or monthly. You can also add or delete bank accounts from your dashboard while using analytics plus. This feature will let you better picture your cashflows by showing underlying transactions on the dashboard.

To avail of this function, get your Xero Accounting Software subscription today!

Business Snapshot Dashboard

Now, let’s take a look at the insights provided by this business snapshot dashboard one by one to know which numbers tell what? The dashboard has profit and loss visuals, income and expenses graphs, gross profit margin, account balances, the payment you will be receiving, and the bill you have to pay within the due date. You can edit the layout of the dashboard by clicking ‘edit layout.’ Here you can move the boxes up and down or add or delete a box. To get perfectly accurate results, ensure that you have added transactions for almost 3-4 months.

Profit and loss

Business Snapshot Dashboard

The figure above shows the profit and loss your company has bared under a set time. Here we have chosen year to date based data. If it is above the line, it shows a profit, representing a loss if the bar is below the line. If the previous data is entered into the system, it will also show the increase or decrease in profit in percentage; thus, the comparison helps you make future strategies. The blue bar tells that the company has made a profit of 3,030 pounds in the given period of Jan to Jul 2021.

Income and expenses

Income and expenses

As the figure above shows, a company’s income and expenses. The amount generated and coming into the bank account is the income, while the amount spent by the company is their expenses. If the company’s revenue is more than its expenses, then there is profit. Just like in the figure above, we see that this company is going in profit. The matrice also shows the cost of goods sold and operating expenses, which adds to total costs. If the previous data is available, the graph will show a dotted line for income and expenditure compared with the last period. You can also see the comparison of both written in percentage. However, for the comparison, data of the previous time must be added.


Business Snapshot Dashboard

In the above figure, the box tells us the gross profit margin of this company. Gross profit margin is the income left to cover up the company’s expenses after paying the cost of goods sold. Here the GPM is 97%. If your company sells any product, for instance, and has a 97% gross profit margin available to cover its expenses, they might want to consider reducing the price of their product. Similarly, if there is less margin, the company would increase product price to cover up its expenses.

The financial position of cashflows

The financial position of cashflows

The financial position of any company shows its balance sheet. And the balance sheet is comprised of assets, liabilities, and equity of any company. It also tells you to combine cash available from all your accounts. One thing to remember is that Xero software considers your credit account cash, so it is essential to consider while looking at your cash position.

Overall balance

The overall balance box is there to tell you the balance of each account separately. Whether you have added 2 or more accounts, you can see the current balance situation on just one screen.

Largest operating expenses

Xero’s business snapshot also categories your expenses into the most significant operating expenses. As the name suggests, this box is about which costs are taking the most of your company’s money. Let’s take a look at the given figure.

Largest operating expenses

Here, we can see that the significant expense of this company is advertising which is taking 9,657.05 pounds for the Year to date, i.e., Jan 1 – Jul 30, 2021. The table also shows that this expense has increased as compared to the last time. Similarly, all other major expenses are also listed down below.

The next up two insight boxes are of outstanding receivables and payables.

Largest operating expenses

Average time to get paid

This box tells you the average time your customers take to pay your amount. I the above figure its 42 days. Whether the time is too long or it’s ok to take 42 days depends on your organization. But if it’s too long, you should be reconsidering your relationship with customers. To get accurate results, use Xero invoicing to list down all the outstanding receivables.

Average time to pay suppliers

On the other hand, the average time you take to pay your suppliers shows the outstanding payables. That is the money you owe to your suppliers, and it’s yet not paid. In the figure above, it’s 1140 days and is quite a lot of time, and you should be addressing this as an issue. Solving this will help you improve your relationship with the suppliers.

Comparison of Data

The Xero’s Business Snapshot is a dashboard that offers some compelling insights into your business for a set period. The best part about this tool is that it allows you to compare the current period data with the last time if the data has been added. So, you can see the trend your company is following, and it can help you work on your problems and make better strategies in the future.

Investment Working Group is a platform where you can learn to manage your personal finances through our insightful articles. Managing small transactions for multiple accounts can be a lot tricky especially organizing them. Xero Accounting software helps you to maintain all the data in order. Through Investment Working Group, we can teach you how to use this tool.


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