Smart Money Choice$

More and more small businesses are using web-based software to run key day-to-day functions. Even if you are only using simple tools like online email services or online banking, should you be concerned about the risks? Are the risks real?

Software companies large and small are pushing most of their flagship applications into “the cloud” (accessible only online through a web browser and/or mobile device). Think about QuickBooks, Quicken, and even Microsoft Office. They are all gradually moving us to web versions of their software with eventual plans to phase out the desktop software altogether.

That means your software and your data will no longer be accessed on your own computer, but only through the Internet on computers located in large data centers “somewhere.”

This trend is quickly gaining momentum, especially with the break-neck pace of new “app” development – including how financial information is being accessed and manipulated using mobile devices.

It’s important to listen to what’s NOT being said by the companies promoting “The Move To The Cloud.” Besides it being more convenient to use web-based software, there are other reasons why they are pushing us more and more onto the Internet.

What do you think about this? Should we be worried about having vital financial information stored in the cloud? Or is this really no different than the risks we face with our dependency on electricity, or the risk of loss due to theft or natural disaster?

What’s your take on it?

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I’m sure you’ve heard all the noise about the BIG claims of mega-success by businesses who are using Social Media to promote their businesses. But is it really just that – a lot of NOISE that doesn’t mean a hill of beans in the real world? Or is this  an important trend that small business owners need to pay attention to for the sake of their bottom line?

Cut through the hype and find out what the real deal is with social media. Get straight answers from an expert who’s actually doing it and knows first hand whether it’s really just a big waste of time, or if you can truly use it to market your business profitably.

Join me, Gabrielle Fontaine, and my special guest, marketing expert and social media guru, Ely Delaney as we cut through the hype and finally learn…

* How to use social media to build relationships with prospects, customer and referral sources

* How social media is changing the way we do business

* How to easily get up and running on the three biggest and most strategic social media networks

* How to attract quality “friends” and “followers” without getting caught up in the numbers game

* What free automation tools you can use to maximize your reach and save time in the process

* How to avoid getting sucked in to wasting a ton of time keeping up with your social posting

* What NOT to do so you don’t make enemies, or worse, get banned from the social networking sites

* How networking online is not the same as in-person networking

Find out for yourself why such respected business authorities as Inc. Magazine are now saying that Social Media really is worth your time.

Isn’t it time you found out how to put it to work for YOUR business? Now you can, right after you attend this cut-to-the-chase, FREE, get-action webinar.

Join us Thursday, July 8 at 8:00 PM Eastern Time for this LIVE webinar training.

“Social Media” Online Business Networking Basics”

Grab your seat as our free guest right here:

=> Register Here

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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.

Q: “Gabrielle, I’m in the market for bookkeeping services. Any suggestions for what to look for and what to expect in pricing?”

This is a typical inquiry I receive through my website. And for good reason. It’s a great question! Let me tell you why.

Doing the bookkeeping in your business won’t make it an amazing, profitable success. But NOT keeping up with the books properly, or not keeping track of your finances at all, can definitely kill your business. That’s why sooner or later, most entrepreneurs realize that it makes sense to get someone else to handle their books for them.

But that’s easier said than done.

When it comes to hiring a bookkeeper, whether in-house or virtually, there are many choices. The most popular options, however, can cause you BIG headaches and cost you thousands unnecessarily.

The biggest problem: Hiring someone who is not competent enough to handle the job.

Yes, you may already have QuickBooks software (admittedly designed for non-accountants) and a willing wife / girlfriend / friend of a friend who is ready to do the “data entry” for you. But that does not mean that you can simply hand over your financial information and get on with running your business. At least not without some nasty consequences down the road.

In fact, even if you search for and find someone who claims that they are a “qualified” freelance bookkeeper, you are not guaranteed clean financial reports for management, and accurate tax reporting. It’s just not that easy.

The scary reality is that anyone can call themselves a bookkeeper, and proceed to really screw up your books…and your business. I see it all the time. My clients pay me thousands as a QuickBooks consultant to come in and untangle their financial data after they’ve tried (unsuccessfully) to do their own bookkeeping, or hired a so-called “bookkeeper” to do it for them.

So, what’s the answer to the question above on what to look for when hiring a bookkeeper so you can save yourself from all the potential heartache?

Ask Questions, lots of them.

Just because someone says they run a bookkeeping service business or that they use QuickBooks doesn’t mean that they are qualified to do so.  Be proactive and ask the following questions:

* What training or experience do you have with double-entry bookkeeping? How do you keep your skills up to date?

* Do you hold any certifications for bookkeeping and/or QuickBooks?

* What type of businesses do your clients have? Are you familiar with my type of business or industry? Can you provide references?

* How do you handle transactions that are incomplete or unclear? (HINT: You do NOT want someone who simply codes everything to a “miscellaneous” account. They should be proactive, communicative and have a system for gathering all the needed information, taking responsibility for preparing complete records.)

If you are considering an in-house employee, I also recommend that you give that person a test to assess her skills. Don’t just accept whatever is listed on the resume. The American Institute of Professional Bookkeepers has a free test available for employers through their website (see Resources below).

What about pricing?

The cost for hiring outsourced bookkeeping services can run anywhere from around $25/hr. to $75/hr. or higher, depending on your location, the services provided, and how they are administered (on-site, virtually, or online).

When it comes to bookkeeping services, however, price is not always an indication of quality. If the most important factor in your decision is low price, realize that you may be setting yourself up for a mess that will cost much more to clean up later. Pay closer attention to true qualifications than the hourly rate.

If Your Budget is Too Tight and You Need to Do It Yourself

QuickBooks is the best software choice because of the user friendly interface. But you need to understand the key basics of the program to use it correctly. So you will need to investment in education.

There are inexpensive books, videos and in-person training classes available. Use what suits you best, just don’t wing it. Get the training needed to handle the basics adequately, or you will have problems later.

The investment you make now in starting the new year off right, whether by hiring a qualified bookkeeper or by learning how to do it right yourself until you can hire someone qualified, will give you a solid foundation for building and managing a solid, profitable business.

It’s just a smart choice.

Resources:

Where to find freelance bookkeepers:

QuickBooks ProAdvisor Database

American Institute of Professional Bookkeepers

Craigslist.org

Bookkeeper Hiring Test (for screening an employee):

QuickBooks Online Video Training:

QuickBooks Basics: New User Essentials

QB QuickTips Video Blog

Most entrepreneurs give little thought to the legal structure of their business, especially in the early days. But not knowing the risks of just “winging it” can come back to take a painful bite out of your bottom line. Even worse, it could put you at very real risk of losing more than your business, without warning.

Why your business structure is worth your attention

Usually the biggest reason to go into business is to turn a profit. And a lot of hard work is involved in building a profitable business, without a guarantee for success.

The difference between wasting your time and getting into big debt, or financial freedom and prosperity, has much to do with building on a solid foundation. Your choice of business structure is a key component when it comes to your business stability – now and for the long term.

What effect does choice of business entity have on your finances and business operations?

Fact is, your profits will be taxed based on your business structure. And, of course, navigating the applicable tax laws is no easy task. The government knows this, so most new businesses are, by default, the type of entity that generally pays the most in taxes – a sole proprietorship or partnership. Thank you Uncle Sam.

In reality, besides employees, taxes will often be your largest business expense, especially for service-based companies. So educating yourself about which business entity and it’s tax advantages are best for your situation can significantly affect how much of your profits you get to keep and how much you are forced to hand over to the government.

Your choice of business structure can also have a big impact on how you need to run your business. There are legal requirements that must be followed, depending on your choice of business entity. When these are ignored (and they often), serious consequences can raise their ugly head, some of which can put you out of business instantly.

Most often, business owners who pick some sort of corporate structure (with or without the advice of qualified professionals) don’t know what the requirements are, leave themselves without any liability protection. That’s a very scary, but extremely common scenario.

How can the risks be minimized sensibly?

The best way to avoid falling into these costly traps is education. Admittedly, understanding the different business entity choices (and there are many of them) is not an easy path to navigate for most of us. But who said starting and running a solid, profitable business was going to be simple? It doesn’t, however, need to be difficult. All it takes is some research to get the needed facts before making a smart choice.

How to make smart choices about business entity

Here’s my four-step action plan for getting the information you need to make a smart choice about the best business structure for your business sooner rather than later (or too late):

1. Know where your business is going. You should have at least a basic business plan laid out that describes what your ultimate goals are, how you’re going to get there, and include an exit strategy. Block out a full day or two on your calendar to either review or map out where you want your business to be in 3-5 years, and what it will look like when you’re “done” with it.

2. Educate yourself first about the different business structures available to you. This should be your own research via books, the Internet or any other means available for credible, unbiased information. Define your priorities (based on your business plan) and identify the basic advantages and disadvantages of each entity choice. Identify the business structure that appears to be best for your goals.

3. Engage a qualified professional. AFTER you’ve done your research, consult with either an attorney or accountant who specializes in small business and discuss your plans. Your objective is to start moving toward a definite decision based on what’s going to give you the best overall protection and tax savings (as well as other key considerations) for your unique business situation.

4. Make it happen. Lay out what needs to happen next to implement your plan to build or  maintain a solid foundation for your business success. Then put it on your calendar and do it!

Take-Action Resource

Straight Talk About Business Entities – multi-media training that investigates the different entity types, their tax advantages and disadvantages for making an informed choice based on your own unique business situation and priorities

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Gabrielle Fontaine, PB is a freelance Professional Bookkeeper and Advanced Certified QuickBooks ProAdvisor. She specializes in assisting Internet-savvy entrepreneurs get control of their books and maximize profits. Gabrielle also publishes the business-boosting online ezine, Smart Money Choices. Get more information at http://www.BookkeepingDirect.com