Smart Money Choice$

What better way to kick off the Fall than by getting some useful information on how to effectively promote your business and increase your bottom line?

If that’s what you want, then you’ll want to read this article by my favorite online marketing expert. It cuts to the chase to solve the mystery of effective marketing using the Internet. You’ll find it on this brand new blog especially designed for small businesses.

Small Business Marketing Weekly

Although I’m primarily a freelance bookkeeper and QuickBooks trainer and consultant, I love to learn what makes small businesses really prosper – and apply it to my own, as well as suggest improvements for my clients’ businesses.

I’ve learned a lot through the MANY books I’ve read and seminars I’ve attended. And the vital conclusion I’ve come to is that, as business owners, marketing is really job #1 for all of us. That’s what keeps the sales coming in, which keeps the cash flowing. And as we know, cash is the lifeblood of your entire business! No sales = no business.

And I can tell you honestly, out of everything I’ve studied over the years and all the people I’ve learned from whose techniques I’ve actually used in my own business, there is no one that has given more high value and true nuts-and-bolts information that really works like Jim Edwards.

No one.

So I hope you enjoy this article as much as I did for a big picture reference of what we really must to be doing to pull more business in locally or virtually with our websites (and beyond). This one’s a keeper:

Small Business Marketing Weekly

And it looks like Jim will be writing a series of these helpful articles. I’m definitely going to be following them, so I thought you’d like to know about them too.

Enjoy!

Gabrielle Fontaine, PB
BookkeepingDirect.com

By the way – I’m a long-time member of Jim’s monthly training program, The Net Reporter. As I said, I think he’s the best (and I’m picky!) because he tells it like it is… AND shows you exactly how to market your business effectively online. (My business is proof of that!)

Most of his training, though, is primarily geared toward building an information-product based online business. So I usually have to try and translate what I’m learning to work for my own QuickBooks consulting business.

But this month he’s doing something I’m quite excited about… Tomorrow he’s starting a 2-webinar training series entitled:

“Using Internet Strategies on a Brick and Mortar Business”

No translation needed! So I’ll definitely be attending this one LIVE! If you’d like to attend the first webinar on Tuesday too, just join The Net Reporter and try it out for a month (you can get two of these live webinars AND get access to Jim’ “Fast Track Video Coaching” for less than most other people charge for a single webinar!)

The Net Reporter

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Not enough cash coming in?

Many small businesses battle cash flow problems, sometimes for years. This can be dangerous, especially in a choppy economy.

If you have frequent cash flow pinches, these days you’re really living on the edge.

If you’re tired of the “excitement” and want to avoid ultimate disaster, you need to be asking some important questions, and then taking decisive action.

How do you know there is a real problem?

This may seem obvious, but you need to know from a very basic standpoint if there are serious issues brewing in your business  as soon as possible. A cash pinch could be a serious warning sign.

Besides looking at your bank account balance, your Profit & Loss Report (also known as your Income Statement) is a quick way to identify the main issue(s).

Has there been a big dip in how much you’re bringing in in Sales recently? Do you compare your sales numbers on a monthly basis. Knowing your numbers helps you identify dangerous trends that could be emerging.

What about your expenses? Has there been a big increase in overhead over a short period of time? Or has the change in the economy caused some of your cost for making each sale to creep higher and higher?

Another question to ask is….

Do cash flow problems keep coming back?

Many businesses are seasonal and typically have a high season and a low season. If you’ve had a crunch like this before, you will want to compare your numbers to last year at this time. Did you have the same problem? Is there something you can do that would help to even out the cash flow?

For example, often landscaping companies will create another income stream in their off season (wintertime) by attaching a plow to their trucks and offer snow plowing services. Or accountants whose bread and butter comes during tax season, add tax planning or bookkeeping services to their service mix to help even out the slow times.

Your highs and lows may not be as obvious, but if you see a pattern, is there some other product or service you could offer that would sell well during your lean time?

Aim to build several sources of income to keep the money coming in build stability throughout the year.

How to handle the short-term issues and solve your cash flow problems for the long term

When in the midst of a cash crunch, what you need more than anything is more cash quickly. That can take the form of a boost in sales, or it can mean collecting the money already owed to you.

One the easiest ways to solve a cash flow pinch is to run a special promotion to pull in some quick sales. More short-term sales may not solve the real problem, but it will get you to a place where you can breathe and focus in rationally to identify what’s really going on in your business.

To solve recurring cash crunch woes, you can’t just live in the moment. You need to identify what has changed or is changing. You also need to come up with a strategy to protect yourself for the long term.

Here’s my three-phase approach for getting into action so you can conquer the cash flow monster before it gets out of hand:

1. Maximize the money coming into your business from as many different sources as possible, creating systems and policies that keep the cash streams flowing consistently and simultaneously.
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2. Evaluate what it costs to run your business and how much it costs to sell your products / services. Identify your most profitable items, and dump any that do not have a reasonable margin. You will also look at your overhead and identify any areas where cash is needlessly leaking out of the business (Hint: To do this right, you will want to review both your P&L Report and your Balance Sheet over the period of a year)
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3. Prepare a budget and a forecast for at least the next 3 months, and track your progress. If your business is seasonal, you will need to build into your budget a cushion fund that you will contribute to in the busy season, and draw upon in the slow season.

By going through these basic steps, your business will become much stronger. You will be able to recognize and navigate changes that affect your cash flow. You can protect yourself and ward off cash crunch crises before they ever hit.

Would you like specific strategies and step-by-step action plans to pull in more cash FAST and turn your business into a solid cash flow machine? Then be sure to check out my new Cash Flow Mastery Course.

If you are using any version of QuickBooks 2007 (or older), you need to pay attention to this.

Effective May 31, 2010, Intuit (the makers of QuickBooks financial software) will discontinue live telephone support and add-on services for QuickBooks 2007 software (all versions).

Services that will be discontinued:

Assisted Payroll
Basic Payroll
Enhanced Payroll
Standard Payroll
Employee Organizer
Merchant Service
Billing Solution (formerly QuickBooks Online Billing)
QuickBooks Email
Bill Pay
Online Banking
Terminal Download
Technical Support Plans and Services

This is not really surprising news, since according to Intuit’s official Discontinuation Program, they only support “the most current version of QuickBooks, plus the prior two versions.” So that means after May 31st, QuickBooks 2010, as well as all 2009 and 2008 versions, are the only years they will continue to support.

Do I HAVE to upgrade?

That depends on how you use the software.

If you are currently using an older version of QuickBooks and do not need any technical support or add-on services, you can continue to use the software as you have in the past. It will keep working just fine.

However, if you need to use add-on programs and support for services such as payroll or merchant services,  you will need to install and register a supported version of the QuickBooks software by May 31, 2010.

But what if I don’t know which version of QuickBooks I’ve got?

That’s easy. If you don’t see which version you have on the “splash” screen when you are opening QuickBooks, then from within the program simply press Ctrl+1 (from the keyboard, not the number pad) and you will get all the information about your current QuickBooks program, including which version you’re using.

An important reason to upgrade if you’re still using QuickBooks 2007 (or older) is because even though Intuit promises to help you out if you lose your keycodes or have licensing issues, their terms and conditions say they will do so only “if that data is available.” In other words, there’s no guarantee they can help you if you are still using an old unsupported version, and you lose your password, have data recovery issues, or need a replacement software CD.

This is significant.

If you are locked out of your data file because you’ve lost your administrator’s password, or you can’t get into your program because of a registration issue, you’re dead. Not being able to access your financial records could literally cripple your business.

But if you are determined to stick with an outdated version of QuickBooks and you do happen to lose your password, you can use the Automated Password Reset Tool available for free on the QuickBooks website. But of course, there’s no guarantees there either. You are still on your own.

If, however, you are ready to give in and upgrade, here are my best suggestions.

Your Upgrade Options

You can, of course, upgrade directly through the Quickbooks website and get a $40 discount (as of this writing, the upgrade price is $159.95)

But you quite likely can get a better price by shopping around a bit. Generally you’ll find QuickBooks at all the major office supply stores locally and online. Amazon is currently selling QuickBooks Pro 2010 for $123.

Some other places you could check out are:

www.staples.com
www.officedepot.com
www.officemax.com
www.bestbuy.com
www.costco.com
www.samsclub.com

And if you are a real bargain hunter, you might be able to find a legal copy of a supported version (QuickBooks 2008 or 2009) on eBay. But realize that you’ll be in the same pinch in another year or two.

So my best suggestion is to just bite the bullet and upgrade to 2010 and be done with it (for three years anyway). There are some great new, truly helpful features you’ve been missing out on in the years you’ve fallen behind.

Getting Up To Date Using QuickBooks

For quick and free mini-lessons in QuickBooks, make sure you get in on my QB QuickTips video series.

And if QuickBooks has always been a struggle for you, why not go all out and get some proper training on using the program more easily and efficiently? I’ll teach you all the must-know functions in QuickBooks in my QuickBooks Core Training course. (The next class starts this coming Monday, May 24th.)

If you are upgrading from QuickBooks 2005 or older, training is especially recommended for you, since QuickBooks is practically a whole new program since that far back. it won’t be an easy transition without some assistance.

As an entrepreneur, what does this “new economy” mean for you and your business?

Do you have a plan? How are you doing so far with this year’s goals?

If you’re still trying to navigate in the right direction, that’s great! Even if the revenue numbers aren’t quite where you’d like them to be (yet), here’s a short video that I think you’ll enjoy. It helps to put things in the right perspective…

While this is definitely one of my favorite “feel good” videos, there are some key lessons here:

1. The greatest innovation and success happens when our back is against the wall and we are forced to find new ways for doing things.  And entrepreneurs are usually the ones blazing the trails to success

2. There are opportunities to seize (lots of them) by focusing on the positive vision of what your business could be. And the rewards belong to the thinkers and the doers (that’s YOU!) and not those with privilege or resources.

The new economy really means it’s our time to shine.

So what could you do TODAY to move one step closer to your vision for yourself and your business?

The major tax deadline of April 15th is quickly approaching for non-corporation businesses (sole proprietorships, partnerships and LLCs). Here are five quick tax-savings tips you don’t want to forget before the deadline arrives in all its glory.

1. Home Office Deduction

Generally, you can deduct business expenses that apply
to a part of your home if that part is exclusively used on a regular basis…

• -As your principal place of business,
• -As a place to meet with your patients, clients, or customers in the normal course of your trade or business, or
• -In connection with your trade or business if it is a separate structure that is not attached to your home.

This deduction includes both expenses that are directly related to your home office (painting, repairs, etc.), as well as a portion of your indirect costs, which include utilities for your whole house, mortgage interest or rent, real estate taxes, even depreciation on your home.

This can really add up to a substantial deduction.

And if you took the home office deduction last year, but couldn’t use it all (it’s limited by your business profit), you can also carry over any leftover deduction you couldn’t use last year and add it to this year’s deduction. (Check your 2008 Form 8829 and look to see if there is any carryover available for 2009 at the bottom of the form.)

The home office deduction is worth the trouble because it also reduces your self-employment tax amount.

Click here to get the details on how to take the deduction here:
IRS Instructions for Form 8829

2. Write off new equipment (Section 179 deduction)

Rather than depreciate business property over several years, you can choose to expense business assets in the year of purchase. Here are basic guidelines for what qualifies:

• Tangible property, like machines, equipment, furniture
• Off-the-shelf computer software

It does not apply to:

• Real estate
• Property used less than 50% in your business
• Property you inherited or received as a gift

You can “write off” (deduct as an expense) newly purchased assets up to $250,000 for 2009.

This is another smart deduction that helps to reduce both your income tax and your self-employment tax.

Click here to get all the specifics here:
IRS Instructions for Form 4562

3. Use Per Diem Rates for Business meals & incidental expenses while Traveling

As long as you can document your away-from-home business travel, you can deduct a per diem rate (per day) for meals and incidental expenses instead of the need to keep records of and report your actual expenses. This can give you a much bigger deduction if you spend less than the daily rate, not to mention it makes the recordkeeping easier.

Of course, you only get a 50% deduction on meals and entertainment for business purposes, but if you’re frugal, you will still get a much better deduction than you would with claiming actual expenses.

And, yes, this one reduces both income and self-employment taxes.

Click here to get all the specifics here:
IRS Publication 1542

4. Maximize your HSA Contributions

If you have a high-deductible health plan (HDHP) for your health insurance and a Health Savings Account (HSA) for your out-of-pocket medical expenses, you have until April 15th to make your 2009 deductible contributions. That’s up to $3,000 ($4,000 if you are over 55) for a self-only coverage plan, or $5,950 for a family coverage plan.

While this one won’t reduce your Self-employment tax, it is a nice deduction in addition to any self-employed health insurance deduction you can take for what you paid in insurance premiums on that high-deductible haelth plan. This winning combination makes 100% of your medical costs deductible, even if you do not itemize. That’s sweet.

Click here for all the specifics are laid out here:
IRS Publication 969

5. Maximize your IRA Contributions

If you have a traditional IRA, you can still make your 2009 contributions up until April 15, and still claim any deduction you are entitled to (usually for a traditional IRA as opposed to a Roth IRA) now. This is an especially smart choice because when you make contributions to your retirment accounts, you will likely also get the retirement savings contributions credit (depending on your income level, among other things). It’s one of the very few times you can legally get a double-dip for a deduction.

General traditional IRA contribution limits for 2009 are:

$5,000 ($6,000 if you’re over 50 or older) – there are, however, several factors that affect how much of your contribution is deductible.

As a self-employed person though, you may seriously want to consider opening a SEP-IRA, since this type of retirement plan allows you to make larger contributions and thus get bigger deductions on your tax return.

IRAs have lots of twists and turns, but if you already have one set up, or want to set up a quick traditional IRA (you can do this easily) and make a contribution for 2009, it’s just smart to max out your contributions and take the deduction for 2009 by April 15.

Click here to get all the ins and outs of IRAs here:
IRS Publication 590
IRS Publication 560

To keep your tax bill as low as possible, the smartest choice is to do your tax planning BEFORE the end of the year. But at least these tips will help you pay as little as legally possible right now for 2009, and then be all the wiser for 2010.