Small business bookkeeping: What you need to know to survive and thrive
In the rush and excitement of starting a new venture, it’s easy to overlook the importance of good small business bookkeeping in the early days and let things slide. When this happens, small business owners often get a rude awakening in the not-so-early days of the business. This can come in a variety of ways, including: You get a costly surprise at tax time, Inventory has been “disappearing” without your knowledge, Employees are miscategorizing transactions, or Your high-priced accountant sends you a hefty bill for the time required to “clean up” your books. When problems occur, it’s not that you set out to do things wrong; it usually just “happens” because of the way your business has grown. Often personal and business banking gets comingled. This can be difficult to sort out. A friend of mine is currently staring at a screen on his accounting app that is asking him to categorize more than 900 transactions because he uses his personal bank account for business. By the way, a business-only credit card can solve this problem. That’s one of the benefits of a business credit card that I outlined in this article I wrote for the MasterCard Biz website. There are many good online accounting software services you can use, but the question is which “you” are we talking about here: you personally or you your business? In other words, will you be setting up categories and keying in all the entries, or will you have a bookkeeper do it for you? Consider these basic areas that fall into the realm of small business bookkeeping: Cash, Inventory, Accounts receivable and payable, and Personnel. How many of those does your business have? The more that describe your operation, the greater your need for a professional small business bookkeeping service. If you’re a one-person business that provides a service (no inventory), then you might be able to get by quite easily with something like Quickbooks’s self-employed accounting app. It can be all that a freelancer or independent contractor needs. But if your business is much more complicated than that, it raises the “degree of difficulty” fairly quickly. Quickbooks, FreshBooks, Sage, Xero, and Wave are some of the more popular apps. Wave is free for its standard accounting package. There are many others in the arena and for a full list, along with ratings, scroll through the listings at GetApp. As with everything, small business bookkeeping is a facet of your organization that you want to set up properly in the beginning. But, if you missed that opportunity, consider bringing a bookkeeper on board ASAP and have that professional fix the problems you’ve created for yourself and get your bookkeeping running smoothly. It will cost you a little more in the beginning, but in the long run the investment will be worth it. Your hassles, worries, and potential liability will be greatly...
read moreUse ‘National Day Day’ To Inspire You and Your Team
One of the best ways to keep your team members on their toes and excited to come to work each day, is to have a little variation in their work days. Occasionally, you want to toss them a curve. However, trying to come up with original ideas and get them scheduled isn’t easy. With that in mind, I’m declaring today “National Day Day.” Today is the day when you look over the calendar of special “National Days” and find some that you think would be great to incorporate into your company’s routine in one way or another. There are a variety of websites that note these days, like the National Day Calendar site, but to get you started, here are some I think you and your crew might enjoy. February 17: National Random Acts of Kindness Day. Challenge your employees to do something especially nice for a coworker or a customer on this day…and don’t forget to include yourself in the challenge. Use it as a teaching moment. Encourage everyone to remember how good it felt to have done something kind and to have received unexpected kindness. That way this may become more than a once-a-year event! March 3: Several special days fall on the first Friday in March, including the National Day of Unplugging, National Employee Appreciation Day, and National Salesperson Day. You could combine employee appreciation and salesperson day into a special event, like a catered lunch or after-work outing. And, if your work requires people to be constantly “plugged into” the Internet, try to find a way for them to get some relief. April 19: National Wear Your Pajamas to Work Day. This might not work for every business, but if it works for yours, relax on the first day back to work after individual income tax filings must be in the mail this year. (That’s right, the deadline is April 18 in 2017.) May 19: National Bike to Work Day. Use this day to emphasize fitness. Recognize individuals are creating healthy habits in their lives, such as biking or walking to work. Share what they do as a strategy to inspire others. June 2: National Leave the Office Early Day. Need I make a suggestion for the best way to celebrate this day? July 12: National Simplicity Day. Have your team focus on ways to simplify processes in your business. How can you make their lives easier or make the customer journey more efficient? As with random acts of kindness, simplification should be a year-round process and a goal for every employee. Bake this one into your culture. I’ve given you six special days that you can use to inspire events and actions in your business during the next half of the year. Frankly, they don’t have to happen on the exact calendar days assigned to them. Use them in the best ways that fit your...
read more2016 holiday spending and what it means for your small business
If 2016 holiday spending taught us anything, it underscored a message every retailer needs to understand and act on: Sales are moving online and moving to mobile. Failing to appreciate and strategically respond to that fact will doom many retailers – from the corporate giants to the local small businesses. It is already clouding the futures of some national brands, including Macy’s and Kohl’s. Due to its weak 2016 performance, including a poor holiday season, Macy’s announced plans to cut about 10,000 jobs. Its stock, along with Kohl’s and others took major hits, as chronicled in Fred Imbert’s CNBC article. Today when families are watching the traditional holiday movie “Miracle on 34th Street,” few remember that Gimbles was a major force in U.S. retail and staged a Thanksgiving Day parade before Macy’s launched theirs. If Macy’s doesn’t turn around its fortunes, it could someday go the way of Gimbles and become not much more than a Wikipedia entry. The important point, however, is that many retailers did poorly despite the fact that, overall, 2016 posted the best holiday sale growth in five seasons. Who did so well that their sales more than made up for the bad showings of Macy’s et. al.? Online retailers, as you probably suspected. Visa has pulled together the numbers in its Visa Retail Spending Monitor: Overall 2016 November and December retail sales grew 4.8 percent over the same period in 2015. 2016 holiday e-commerce sales accounted for 24 percent of these sales, compared to 21 percent in 2015. Cyber Monday was the biggest day for e-commerce during the season. Visa also reports that more buyers grabbed their mobile devices to do their 2016 holiday shopping than in the previous year. There are two lessons to be learned here: Retailers must sell via the Internet and they need to create sites that are mobile friendly. Unfortunately, too many small businesses still have no website and many who are already on the Internet, view their websites as little more than an online business card. They create it, post their address and phone number, then forget about it. If that describes you, don’t worry, you can probably fix your problem easily. (More specifics on this in just a moment.) If you have a site, but are not using it to make sales, it will take a little more effort. This gets a more challenging when you factor in the rising importance of mobile devices to e-commerce. You need to be sure you optimally curate your offerings so shoppers can easily find and buy your most important items. Let me share a few final words on how you should design your site. Some small business owners had the foresight to create websites for their businesses early in the so-called Internet Age. The problem is that many of these are custom sites; changing anything on them can be a chore and expensive. If that is you, I suggest you jettison your old owner-unfriendly site and rebuild with either WordPress or one of the services I describe in this guide to online website building services. The services I cover in that article include robust e-commerce features and most of the templates also have mobile-friendly versions. From an implementation standpoint, you can easily get an e-commerce site that is mobile capable...
read more13 top small biz influencers share their single most important word of advice
Every new year brings new business initiatives. I thought it would be good to ask 13 small business influencers for what they considered to be their single most important word of advice for anyone considering a new business launch in 2017. Read what they have to say. You’ll see that a range of critical issues are covered along with some warnings that any entrepreneur would be wise to internalize. Here’s a good suggestion: Boil each of these down to a short sentence or phrase, paste them onto a single page, print it out, grab a magnet, and stick it to the door of your refrigerator. David Smethie @DavidSmethie Evaluate the profitability of your niche. In an ideal world, you could start a business and make money from whatever it is that you’re most passionate about. While it’s important to enjoy what you do, the reality is that some niches don’t provide enough demand to sustain a profitable business. If there are no competitors in your niche, it’s likely that there isn’t any money to be made. Do your due diligence before sinking time and money into any business. Denise O’Berry @deniseoberry Conserve your cash. When first starting your business there will be plenty of things (services, tools, and products) you’ll need to get it rolling. And you’ll have more cash flowing out than cash rolling in. Only spend money on those things that you need right now. Don’t invest in something you might need six months from now. It always takes longer to become profitable than you think it will so approach purchases for running your business using the “just in time” approach. Buy it when you need it and not before. Don’t let your optimism and enthusiasm for your new business get in the way of your success. Use your head, not your heart when spending your cash and you’ll have a lot better chance for success in the long run. John Spence @AwesomelySimple Make sure there is a market that would eagerly pay a profitable price for your product. Alasdair Inglis @wearegrow Test your product or service fearlessly. Use the feedback you get to make something that customers love and will pay for. Catherine Morgan @PointA_PointB The most important skill to master as a small business owner is what I call the “graceful swan dive face plant.” You will fail sometimes so get used to it and like a champion gymnast, stick that landing with your arms high above your head, brush yourself off, and move on. Richard Gilbert @richarddgilbert When starting a business, small business owners MUST focus on cash flow, especially at the earliest stages. Quite often owners are developing business models and thinking a about PROFITABILITY. The importance of managing CASH FLOW is that it creates a daily mindset around managing the business’ daily inflows and outflows. Without this daily ritual, small business often run into liquidity crunches, which can cause business failure. Antonina Mamzenko @amamzenko “Treat it as a business right from the start and don’t turn it into an expensive hobby. Especially if you’re in a creative business like me, it’s so easy to ignore the numbers and do it for the art’s sake. Don’t. Do your sums, and charge what you need to charge to make a living. Your time away...
read moreThis week in small business: Success. Is it all in your mind(set)?
There’s lots of great information in this week’s curated content collection that will boost your professional and personal productivity, including tips to beat back burnout and get your mind set on success. Also, we have some social media slip-ups you must avoid and tips to land the small business loan you need to propel your 2017 growth. Leadership, management, and productivity Are you putting all of your retirement “eggs” in one basket? Kerry Hannon offers five retirement planning tips for small business owners. The buzz is that loans are getting easier for small businesses. If you’ll be in the market for one, review “the Three C’s” that Brock Black says will help you qualify. To make 2017 your most productive year ever, review these 12 powerful habits for growth mindset success from Ari Kopoulos. Marketing and sales Jennifer Lonoff Schiff points out nine social media faux pas many small business owners are guilty of in this CIO.com article. Did you do any livestreaming in 2016? Tarun Wadhwa and Sachin Maini say that last year marked the medium’s “coming of age.” Entrepreneurship, startups, and innovation If burnout is knocking (or pounding) at your door, check out the four ways KC Agu says entrepreneurs can get the rest they need and thrive. It may run contrary to conventional wisdom, but eccentric entrepreneur Shaun Neff says inexperience helped him succeed. Kayla Jacobs profiles Jana Blankenship in this article titled, “Meet The Mogul Mom Who Makes Being A Green Beauty Entrepreneur Look...
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