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What to do Before You Start Your Business

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Are you interested in starting a new business? Make sure you do plenty of research and have a firm business plan ready before you take the plunge.

Making the Transition

If you have signed a noncompete or confidentiality agreement with your current employer, review it carefully to make sure it won’t hamper your startup efforts. If your new venture is in the same industry, be careful not to burn any bridges when you leave your current job. Scout out your opportunities. Buying a franchise or an existing business is much different than building a new business from the ground up.

Growing Your Business

Where will your customers come from? You may have one or two great prospects, but that may not be enough. Can you count on referrals from current business associates? Take a good hard look at opportunities for expansion that exist.

Figure Out Financing

Even with great prospects, it may take some time until cash starts coming in on a regular basis. Do you have enough of a financial cushion to get you through? If your spouse has an outside job, your spouse’s earnings and benefits may help provide stability during the startup period. If you need funding, where will it come from? Have you considered looking for a partner or investor?

Getting the Word Out

How much marketing and advertising will be required? Put together a comprehensive plan along with cost estimates. And, unless you’re familiar with the less traditional marketing and communication opportunities that today’s new media offer, you may want to enlist the help of someone who is.

Make a Budget

List every expense you can think of: rent, payroll (if any), phone and Internet service, computer equipment, website design, insurance, transportation costs, self-employment tax, etc. Then draw up a budget. Once your venture is up and running, you can use the budget as a guide in managing your finances.

Call our Fort Smith, AR Accounting Firm* today at 479-242-1236 for more tips on how to ensure you’re following business best practices, and let us help you keep your company in the black. We can assist with new business advisory services you can count on.

Why You Should Do a Financial Review Mid-Year

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Before you get involved with other things this summer, schedule a mid-year checkup. No, we’re not talking about the height/weight/blood pressure kind of checkup, we’re talking about the income statement/balance sheet/cash flow kind of checkup — a review of your business’s financial operating fundamentals.

If you review your vital financial information only when year-end rolls around, you may not know there’s a problem until it’s too late. The more often you take your company’s “pulse,” the sooner you’ll be able to notice — and react to — changes in your business situation.

Check Your Vital Signs

What should you be looking at? Start with the operating fundamentals. For example, what’s the status of accounts payable? When’s the last time you ran an aging report for accounts receivable? How quickly is your inventory turning? What is your profit margin?

These numbers are critical to running your business. You can’t make accurate decisions if your figures are old. And, by keeping track of key financial ratios, you can more readily spot trends that should be addressed sooner rather than later.

Monitor Your Budget

Next, check your spending. If overspending is a problem, creating a comprehensive budget that establishes realistic guidelines is an effective remedy. Make sure you have a budgeted amount for every line item expense on your operating statement. Then track and compare actual spending to budgeted amounts on a regular basis.

Reduce Your Debt

Avoid the temptation to take out all your profits in good years. Instead, consider reinvesting some of those earnings in the business. Using retained earnings instead of debt to capitalize your business saves money — and provides a safety net that will be there to help you through periods of lackluster sales or unexpected expenses. A healthy debt-to-equity ratio will also look great when it’s time to borrow money or sell your business.

See a Specialist

Helping owners build and maintain healthy businesses is our specialty. Let’s schedule that mid-year review of your company’s finances soon.

To learn more about financial reviews give us a call today at 479-242-1236. We’re smart business consultants that can offer insights and experience can translate into a better bottom line for your business.

Making a Year’s Profit in a Seasonal Business

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If you have a seasonal business, you most likely face some challenges that year-round businesses don’t. After all, trying to squeeze a year’s worth of business into a far shorter period can get pretty hectic. Here are some tips that may help.

Cash Control

All small business owners have to be careful cash managers. Strict management is particularly critical when cash flows in over a relatively short period of time. One very important lesson to learn: Control the temptation to overspend when cash is plentiful.

Arming yourself with a realistic budget and sound financial projections, including next season’s start-up costs, can help you maintain control. And you may want to establish a line of credit just in case.

In the Off-Season

It’s difficult to maintain visibility when you aren’t in business year round. But there’s no reason why you can’t send your customers periodic updates via e-mail or snail mail. You’ll certainly want to announce your reopening date well ahead of time. You can also spend time developing new leads and lining up new business.

Time for R and R

You deserve it, so take some time for rest and relaxation. But you’ll also want to use the time your business is closed to make any necessary repairs and take care of any sprucing up you’d like to do. You can also use the off-season to shop around and look for deals on items you keep in stock and/or equipment you need to buy or replace.

Expansion Plans

If you’re thinking of making the transition from “closed for the season” to “open all year,” start investigating new product lines or services. If you diversify in ways that are complementary to and compatible with your core business, your current customer base may provide support right away. A well-thought-out expansion can be the key to a successful transition into a year-round business.

At ValueMetrik CFO we are Fort Smith, AR business consultants and our job is to help you develop a vision for the future that includes a plan of action with attainable goals and objectives for your business. If you have any questions, don’t hesitate to reach out to use at 479-242-1236.

Are You Using QuickBooks Online’s Mobile App?

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Even if you don’t travel for work (but especially if you do), you should explore what QuickBooks Online’s mobile app has to offer.

You already know how convenient it is to be able to access your company’s financial data from any desktop or laptop computer that has an internet connection. Still, there are times when you’d like to be able to complete some of your accounting tasks without firing up a full-blown browser and logging on to QuickBooks Online.

If you haven’t yet tried out the site’s companion mobile app, you might be surprised at how much you can actually accomplish on your smartphone. Take a look at the app’s main menu (with a partial view of the Activity screen to the right):

You can’t do everything on QuickBooks Online’s smartphone app that you can do in the browser-based version, but there’s a surprising amount of functionality here.

Once you’ve downloaded the app and signed in with your QuickBooks Online user name and password, you’ll see a home page divided into two vertical sections; you can toggle back and forth between them. One is your Dashboard, which displays current account balances and a graph showing an abbreviated version of your Profit and Loss report, as well as a graphical summary of paid and unpaid invoices. Click on Activity to see a list of your most recent actions and transactions.

Click on the three horizontal lines in the upper left of the screen, and the app’s main menu slides out. As pictured in the image above, this interactive list also serves as the app’s primary navigation tool. Any data that you’ve entered in the browser-based version (as well as anything you add here) will appear in list form when you click on an entry here. To add customers, invoices, sales receipts, etc., click on the + (plus) sign. You can also enter new transactions from each individual list screen.

Adding Transactions

If you’ve worked with mobile apps at all, you know that the user interface is different from what you see in full versions of applications accessed through a browser. QuickBooks Online’s app, though, is exceptionally easy to understand and use – perhaps even easier than the browser-based QBO.

Take the app’s New Expense screen, for example. At the top of the page is a camera icon. Click it to take a picture of a receipt. You can also enter the total manually in a field to the right. Below that are three buttons representing Credit, Check, and Other, so you can indicate how you paid for the purchase.

You’ll describe the expense by clicking on links that contain labels like:

  • Who did you pay?
  • What kind of expense is this?
  • Who was it for?

When you click on one, the app opens your list of related data. So, Who did you pay? opens your list of Payees. You can select one or add a new one. Click on the Billable button if the expense can be charged to a customer, and click Add a Split if you need to separate some of the items. There’s also room to add a Ref # and Memo. When you’re done, click Save to add it to your main QuickBooks Online file.

Viewing Existing Information

Besides entering data in the QuickBooks Online app, you can look up existing information. You can just as easily find records and transactions you’ve entered either in the browser-based version of QuickBooks Online or on the app. You can follow the journey of an invoice as pictured in the screen shot above. QBO even prompts you to complete steps you haven’t taken. Click on the pencil icon in the upper right, and you can edit the data that appears on that screen.

Warning! Editing transactions that have been processed is risky. If you’re making errors that need correcting, we can help you determine when this is safe.

The QuickBooks Online app can also provide quick overviews of customer activity, with links to actions.

You may never need to access your QuickBooks Online data remotely on your smartphone. If you do, though, we can help you get set up with the site’s companion app so you’ll learn how they work together.

At ValueMetrik CFO, we’re Fort Smith, AR Certified QuickBooks ProAdvisors® so we have QuickBooks down to a science. If you need any assistance with your QuickBooks, give us a call at 479-242-1236 – we look forward to helping you!

Why a Succession Plan is Important for Your Business

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You’ve devoted time and money and poured heart and soul into building a successful family business. But do you have a succession plan? If not, you should. Without a plan for transferring your business to the next generation, anything could happen. As seasoned Fort Smith, AR business consultants, ValueMetrik CFO is here to help you develop a vision for the future that includes a plan of action with attainable goals and objectives.

Here’s what you need to do when developing your succession plan.

Deciding on Your New Role

Start by deciding how much or how little you want to be involved in the business after the transfer is complete. Are you picturing a clean break? Or a period of shared responsibilities and gradual transfer? This is an important decision because it will likely influence other decisions, particularly financial ones.

Choosing a Successor

This can get tricky, especially if there are several family members who may have an interest in — or expectation of — taking over the business. If there’s one clear candidate, that makes it easier. But don’t just assume someone (e.g., your oldest son) is the right successor. Do what’s best for the business. The best choice may be a grandchild, a niece, or even a relative paired with a trusted employee.

Estate planning is an important sidebar to a family business succession plan. There may be children who have no interest in being involved in running the business and are happy to let their siblings take over. However, they probably expect equal treatment when it comes to inheritances. If this is a likely scenario, make sure everyone communicates as clearly as possible and develop a plan you think is fair.

Grooming a Successor

Spend time grooming your successor, even if it’s a son or daughter who knows the business. He or she should understand how every part of the business operates. Before your successor starts representing your business publicly, make sure he or she meets your business contacts (clients, vendors, financial partners, etc.).

Figuring Out the Money

You probably don’t want to give your business away, even to your own offspring. Figure out how much you’re going to need to finance your next venture (retirement, a new business, etc.), and come up with an arrangement that meets your needs.

Take charge of your financial future. Give our Fort Smith, AR Accounting Firm* a call today at 479-242-1236 to find out how we can assist you and your business. Or, request a consultation online.

How to Get A Handle on Payment Issues In Your Business

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Fort Smith, AR Accounting FirmMost small business owners love what they do. But that’s not to say things can’t get a little difficult, especially when customers don’t pay their bills on time. Even one or two slow-pay or no-pay customers can be enough to throw your company’s finances off. Value Metrik works with Fort Smith businesses to help with accounting and bookkeeping tasks. We diagnose problems and define the changes that need to be made to advance business performance and increase profitability.

We know that understanding what might be going on with your customers and being proactive can help you keep your accounts receivable on steady ground.

Purchase Order Predicaments

Not all customers use purchase orders, but those that do rely on them to coordinate ordering and accounts payable functions. If there’s a mix-up involving a purchase order and your invoice doesn’t match up with the customer’s purchase order, your invoice could end up on the “problem” pile instead of the “pay” pile. Be proactive by verifying that the purchase order numbers on your invoices are correct before they are sent.

Strapped for Cash

Lack of money is a common excuse for not paying. One reason your customer may not be able to pay you is because your customer’s customers haven’t paid their bills. Regardless of the reason, be the squeaky wheel and keep communicating with your past due customers.

You can help reduce your exposure to customer cash shortfalls by tightening your credit requirements.

Disputes, Dilemmas, and Other Disappointments

Mishaps, damaged goods, late deliveries. Plenty of things can go wrong during the fulfillment process. Rather than make a phone call, customers may just “file” your invoice at the bottom of the pile.

Follow-up e-mails or phone calls to find out if your customers are satisfied will help smooth any ruffled feathers and could improve how quickly you get paid.

Vanishing Invoices

“We never received your invoice” is a weak excuse, but you still have to find a way around it. Once again, early follow-up is key. Paperless billing and the potential to monitor whether e-mailed invoices have been opened can also help eradicate this excuse.

Don’t get left behind. Contact our Fort Smith, AR Accounting Firm* today at 479-242-1236 to discover how we can help you keep your business on the right track. Or, request a free consultation online.