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Which accounting software?

The truth is that your bookkeeping is a nightmare because you ignore it until the last possible moment.

The fact is that your accounting software should be chosen, set-up, and used on a daily basis to provide awesome service to your clients. Done correctly, your bookkeeping will show you the results of every business decision in the form of net income on your income statement, not to mention avoiding that surprise tax bill.

When it comes to choosing accounting software, many businesses do little, if any, homework before jumping in and buying software. After all, you only need accounting software so you can crunch numbers for a tax return, right? Absolutely not. Accounting software is the foundation of your business. It helps you serve your customers better and shows you the results of every business decision you make.

Is there a perfect accounting software that I recommend every business use? No. I don’t believe in one size fits all solutions for any part of a business.

The primary accounting software companies in the small business sandbox are Xero and Quickbooks. If you bought Quickbooks without a second thought, you can thank Quickbooks’ marketing efforts for that. Quickbooks has something like 80% of the small business accounting software market in the United States. Does that mean it’s the best solution for your business? Not necessarily.

Choosing and set-up your accounting software for your ideal client is how you simplify your bookkeeping.

What you are selling, to whom, and how you sell determines whether you just created a bookkeeping nightmare.

Products

If you have physical inventory to keep track of, Quickbooks Online has those features. However, if you are selling inventory on multiple channels, Quickbooks can’t handle that and you could find yourself overselling products. Xero has very basic inventory management.

If you are selling physical products on multiple channels (Amazon, E-bay, Etsy, etc.), you’ll need a third-party add-on to accurately keep track of your inventory. If you sell your product in person and online, you need a third-party add-on app with point-of-sale and multi-channel inventory features.Both Quickbooks Online and Xero integrate with numerous inventory add-on apps. The software you use must integrate with your accounting solution otherwise you just created a time-consuming bookkeeping nightmare.

Businesses that sell physical products tend to have more complicated bookkeeping because of the inventory management and sales tax requirements. However, there’s plenty you can do to keep your bookkeeping from looking like something from a horror novel.

If you are selling physical products, especially on multiple channels, I strongly recommend taking a look at TaxJar to help manage your sales tax.

Services

If you are selling services and digital products, how you sell is determined by your ideal client. If your ideal client is large corporations, you need flexible invoicing to accommodate their requirements or payment will be delayed.

Quickbooks Online only offers their merchant service for online payments. Personally, I wouldn’t use it because of the horror stories. When they still owned Intuit Payment Network, Intuit mysteriously held a payment for almost two weeks and refused to provide any explanation. I stopped using Intuit payment services that very day and haven’t looked back.

Xero connects to various payment services such as PayPal, Stripe, and Authorize.net. While automatic recurring payments are not possible in Xero, your invoices can be set-up as recurring and all are sent with a “pay now” button. Invoices in Xero are very customizable and you can have several templates for different needs. Quickbooks Online allows only one invoice template.

Quickbooks Online and Xero both have the ability to create a simple estimate. Both allow you to set up numerous invoice items to use as standard text. If you need more complex, professional-looking proposals with cover pages, images, etc., you’ll want to look at add-on proposal apps such as Quotient. Be sure to choose an app that integrates with your accounting software of choice. Why? Because when the client accepts the proposal the app can automatically push that proposal to your accounting software and create an invoice.

This is just the start to comparing Xero and Quickbooks. The bottom line is that you should choose the accounting software that will do the best job of supporting how you will do business with your ideal client.

Would you like help with your software? Get in touch.

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bookkeeping nightmare

3 Mistakes Business Make With Their Finances

1. Waiting too long to set-up accounting software

Many businesses wait until the second or third year of operations to set up a bookkeeping system. One reason is the realization your business has a good chance of making it. Another reason is that it’s time to apply for a business loan and the bank asked for financial statements. Sometimes books are set-up because it’s stressful not knowing the financial health of your business. Or maybe multiple years of tax returns must be filed. Continue reading

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Can you afford to grow your business with Amazon?

Amazon: Is it the right way to grow your business?

I don’t believe there is one sure-fire method to growing your business. What worked for one person to grow a business may not work for you or me. A system to grow your business to XX dollars in XX time is a system that worked for that person with certain education, experiences, and personality. Will you see the same results? Perhaps. That said, I am concerned about the number of businesses jumping on the Amazon bandwagon. Continue reading

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Is your business ready for a disaster?

The historic storm on the east coast brought this question back to me. Think about it. If everything in your office were lost to fire or flood, how would you continue your business? By everything, I mean all computer, files, and papers.

How would you pay your employees or vendors?

How would you know which customers you owed orders to? Or how would you communicate to your customers that you are still in business at all? How would you get replacement inventory?

How would your employees know whether they still had a job?

If your business is leveraging cloud technology, these questions are easy to answer if you take the time to do some preparation. Paperless timesheets and online payroll processing make paying employees on time a breeze.

Whether using your online banking on the “pay now” button on vendor invoices, paying vendors on time is a breeze. If you have a higher volume of transactions, there are a number of other options to pay vendors electronically.

Using cloud-based accounting, project management, and CRM solutions will ensure you and your team can work from anywhere. Cloud-based email such as Office 365 or Gmail means you stay in touch with employees and customers.

They key to seamlessly keeping your business operating during a disaster is planning. Now is the time to get the right tools in place and prepare a disaster recovery plan that is communicated with your employees. Don’t let a disaster be the end of your business.

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Goodbye 2015, Hello 2016

Where did the year go? 2015 is over and all that’s left is to close out the financial year and get your taxes done. Opportunity for 2015 tax planning is gone (except for a last minute retirement account contribution, or estimated tax payments). So if you haven’t already done so, it’s time to tally up how you did last year.
First things first. If you hired any independent contractors (web/graphic design, attorney, accountant, virtual assistant, etc.) or paid rent to a landlord and you paid them $600 or more, there’s an excellent chance you need to issue them a 1099. The 1099 forms must be postmarked to recipients no later than January 31. So stop procrastinating and get your 2015 bookkeeping done. Need help getting those 1099s done? Click here.
Need some help pulling together those 2015 numbers? I can help you set up an Excel spreadsheet or an online accounting system in Quickbooks or Xero. Or perhaps your Quickbooks or Xero needs some cleaning up. Ready? Click here.
Have you resolved to really learn how to use Quickbooks or Xero better for your bookkeeping this year? Perhaps learn to do things more efficiently? I’ll teach you. Ready?Click here.
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2015 Year End Stuff to Know

Can you believe 2015 is almost over? The end of the year brings a number of due dates with the IRS for your business. Here’s a summary:

January 15 – Final estimated tax payment for 2015 due for form 1040-ES.

January 15 – December payroll taxes due.

February 1 – 1099 and W2 forms due to recipients.

February 1 – FUTA tax payment due for 2015.

February 16 – Get a new W4 form from employees who claimed exempt from tax withholding for 2015. If a new form is not received for 2016, begin withholding taxes on their next paycheck.

February 29 – 1096 with 1099 copies due to the IRS.

February 29 – Form W3 with copy A of W2 forms due to IRS.

March 31 – W2 copies due to Social Security Administration.

Note: If you are using electronic filing services with your payroll service, the W2 copies are automatically submitted to the Social Security Administration.

The IRS has set the 2016 mileage rate at 54 cents per mile. Read more.

Need help filing your 1099s and closing out your accounting year? Don’t delay. Get in touch.

 

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Do You Have a Backup Plan?

I was hanging out in a coffee shop working the other morning, and the internet connection went down. As was my habit, I was working from the hotspot on my iPhone, so it wasn’t an issue for me. I overheard the staff tell customers they couldn’t take credit card payments because the internet was down. Could the customer pay cash? Then I overheard the internet provider wouldn’t have the problem fixed until about four p.m. that day. Considering how many people don’t carry cash, I would imagine a lot of sales were lost that day.

As a society, we depend on technology each day. What’s your backup plan if the technology you use fails you? What happens if the hard drive on your computer fails? What happens if the internet goes down? Your web host gets hacked? Power goes out? Fire? Flood? How will your business continue?

If that coffee shop had a backup plan, the staff wasn’t aware of it which is the same as not having a backup plan at all. What could this coffee shop have done? They could have installed a second internet connection from a different provider. Or they could have switched over to the mobile app on their phones from their credit card processor or point of sale company. There are options available, but planning is required. Hopefully before something happens. Can you afford to lose a day (or more) of sales?

Using cloud-based backup services to backup your hard drive, multiple internet connections, generators, a full-scale disaster plan, or many other options could mean survival of your business. Need some help getting a backup plan in place? Get in touch.

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Systems, What Systems?

You hear and read it everywhere; you need systems in place. But what does that mean? It means developing procedures, processes, and routines to manage your business. For example, what is your process when you receive an email or phone inquiry from a prospective new client? How do you keep track of this person and their contact information? Another example is keeping track of clients who owe you money.

There are dozens of tools out there to help you manage the information and transactions for your business. Deciding which tools are best for you can be time-consuming. I spent hours reviewing, researching and trying out various tools before settling on those I use now. I also continue to re-evaluate the tools I use as well as new ones to make sure I am using the best tools to run my business. Choosing the tools to help you run your business is the easy part. Developing the daily habit of using those tools can be a challenge. Sticking with those daily habits, well, let’s just say I fell off the wagon and paid the price.
197H
During my recent move from Arizona to Colorado, I was reminded of the value of the systems I had in place. Mostly because I stopped using some of them. I immediately became scattered and disorganized. Balls got dropped. I became stressed because I couldn’t find the information I needed or forgot something I was supposed to do. The paper was everywhere because I didn’t take the time to sort and process my notes each day. When I sort and process my notes from the day, items are added to my task management system, client notes, calendar items set up, etc.

A long distance move is stressful enough, becoming stressed over little things because I didn’t stick with my systems made it worse. As I’ve worked to re-establish the habit of following my systems, I found there is still much satisfaction in shredding paper and banishing it from my life. My stress level has gone down to whatever is considered normal for me. And to the pair of scissors that went missing during my move, I hope you found a happy new home. You’ve been replaced.

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Leverage Technology to Grow Your Business

I meet many business owners whose businesses are growing but are stuck because there’s not enough time in their schedule to work with clients and take care of the administrative side of things. There are a couple ways to get beyond this challenge.

One way to serve more clients is to outsource. What do you outsource? Your weaknesses. You know, those tasks you dread doing. Phone calls, cleaning, marketing, accounting, copywriting, etc. Outsourcing tasks to an expert not only frees up your time to work with more clients, that expert will get the job done faster and better than you because they are the expert. How to find those experts? Ask at networking events. Ask in your online groups. Look at Upwork.com. Post something on Craig’s List. Look at Fiverr.com.

Streamline and automate to grow your businessAnother way to free up time in your schedule is to streamline your business processes with technology. In the not too distant past, technology was something only affordable to big corporations with big budgets. Those days are gone. A great example of technology you can put to use right now is scheduling and booking software. How many sales have you lost because you didn’t follow up fast enough (or not at all) with a client to get an appointment scheduled? Online scheduling software such as TimeTrade, Acuity, and Booking Bug allow you to set appointment times for your clients to choose. Some of this software even allows your client to pay when they book the appointment. This type of software costs between $10 and $30 per month. If you make even one sale of at least $30 during the month, the software will pay for itself. Think of it. No more phone tag. No more lost opportunity. And since you are spending less time on the phone, you have more time to work with clients and grow your business. And that’s what you want, right? If you’d like some help putting technology to work for your business, please get in touch.

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It’s Too Expensive

I don’t usually write about books I read. However, reading This Book is About Travel by Andrew Hyde got me thinking.

In spite of the title, the book is about much more than travel. It’s about getting out of your comfort zone. The author gave away everything he owned and traveled the world for 16 months. He traveled with one backpack and purposely didn’t plan every detail to take advantage of random adventures whether those adventures were conversations with locals, tours, or just experiencing a new community. While I’m not sure I could live out of a backpack and either couch surf or stay in hostels for an undetermined about of time, I appreciated reading his insights. Hyde traveled for the experiences, not just to check locations off his bucket list. He found creative ways to get to know the locals and refused to buy guidebooks.

Rather than a historical accounting of his trip, Hyde shares his experience about a different place he visited in each chapter of the book. The chapter about New York City struck a cord with me. He was visiting a friend, and they had the opportunity to see a Broadway play at over 60% off the regular price that would have cost them $40 each. The response of his friend? It’s too expensive. (The issue wasn’t a lack of money.) Notice the response of his friend wasn’t that he didn’t want to see the play. That got me to thinking about how many experiences I missed out on because I thought something was too expensive. Yes, the value is in the eye of the beholder, and there is the economic reality of simply not having $40. After reading this chapter of the book, missing out on something I wanted to do because I wasn’t willing to spend $40 seems foolish. And I’m determined to stop and think before declaring something is too expensive.

34HBeing a business owner, I also related Hyde’s New York City experience to running my business. We business owners work too many hours, think we can accomplish more than is realistic, and miss out on too many other experiences. Is it too expensive to invest $30 per month in software to streamline and automate a business process that will also give back two hours of your time each month? What could you do with that two hours? Go for a walk? Spend time with family or friends? Accept a new client?

What about the cost of outsourcing areas of our business where we have little experience, dread doing, get stressed out over, and mostly avoid? Is it too expensive to outsource those things that keep us awake at night and freak us out? What’s that worth to you? Think about the result of that investment. Who among us doesn’t complain about not having enough time to accomplish all we want? We all get 24 hours in a day and the only way to get more done in a day is to eliminate things from our to-do list or outsource. Outsourcing could mean automating with software or hiring someone to help us get more done. In the future, before I say something is too expensive, I’m going to stop and ask myself what it’s worth in the way of enjoying a new experience or giving me more time to accomplish more on my to-do list. How are you going to open yourself to new experiences?

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