Building Your Business for Success

A study by Guidant shows that a little less than ⅓ of business owners said that their biggest motivation for starting a business is that they are ready to be their own boss. If you’ve decided that you want to open your own business, there are numerous ways to create a successful business, but the first place to start is defining success for you.

What does success mean to you? How do you create a successful starting ground for your business?

When first thinking of creating a business, many of us have different motivating reasons why but, of course, we all want to be successful. Success for many of us means profit but success could also mean you want to help people (solve problems) or you’re extremely passionate about sharing your hobby with others. Defining success for you is the first step in creating value in your business. This is a critical step because knowing what success means to you allows you to focus your time and energy on what matters most (to you). Even with our different definitions of success, there are quite a few things that help make a business successful.

For starters, have a strong business idea. You will want to pick a good, niche thing in your industry of choice. This means picking something that isn’t too specific nor too broad. Digging deep and learning more about your niche may help you to decide what exactly you are putting into the market to help everyone and allows you to become more knowledgeable in your future business overall. Furthermore, bear in mind the current market demand for your product/service. (Does your target audience want/need this? Is the market already over-saturated with this?) When you have a general concept of what your business idea is, consider talking to your friends and family. They may give you valuable feedback that is more suitable and aid in looking at the possible faults of your idea. After you’ve solidified what your business idea is, be sure not to over-sell your product/service. Over-selling could mean falsely advertising things your product doesn’t actually do or setting a bar too high and going over your area of (current) expertise. Also, set clear policies for everyone. By doing this from the beginning, it can reduce confusion for everyone and protect you from potential conflict down the road.

Defining success & having a solid, concrete idea is just the beginning of owning a business. Even though there are many factors in the success of a business, there are plenty of ways to make your business shine!

Business building tips for success

As is life, there are many factors outside of our control that can influence the success of our business. By being proactive to these outside influences, you can enhance your business for success. To begin, your leadership and the team behind you are vital. As a business owner, be sure to practice intentional kindness. A good leader is kind as well as honest, transparent, and genuine. Kindness plays into how customers perceive your business as well as employee morale. (Refer to Kindness & Its Value In Your Business as we covered more about kindness & the value it brings to your business!) When you are a great leader, your team benefits, too. As we covered in Well Put-Together Teams & Their Significance, having a high quality team boosts profit, productivity, and helps all business relationships flourish!

The next essential part of your business are the customers. When handling customers, remember that you are the leading expert in your business, so be sure to look at your products/services from their point of view. Understanding where a customer is coming from can mitigate any challenges that may come up. Although you should try your best to solve any issues before they reach the customer, it is inevitable that problems will arise from time to time. Spending time to make sure employees are especially equipped to deal with customers can create a better experience for everyone involved. Additionally, if an employee brings feedback about the customer service back to you, truly hear them out and take action to resolve the issue so it doesn’t happen again. Another way to enhance the customer experience is connecting with them via gifts (like nice baskets from your business or a simple hand-written thank you) because this creates a personal connection and makes the customer feel even more significant to your business. Finally, who doesn’t love a great deal? Hosting deals like BOGO (Buy one get one free), having a free trial period, and creating loyalty or referral programs incentivizes customers to spread the word about your business and be rewarded for it.

Moving to our next point, make sure your business reflects you as a person. Your morals should clearly be reflected in the company and your personality should radiate through! An impactful way to show who you are through your business is in your advertising and marketing. By being authentic in your social media posts, those who resonate with your morales will be more drawn to your business – attracting them and possibly others to your business. In addition to original content, try to include more than just ads or promotions. Having segments where you give something, like a guide to a monthly calendar if you’re in the fitness industry or a weekly column where you write up advice in your industry, can make your social media more appealing. Additionally, in our digital world, traditional marketing is often getting left behind. In a 2017 study by MarketingSherpa, consumers were asked what ads they trust the most. The top scoring categories include: print ads (82%), TV ads (80%), mailer ads (76%), radio ads (71%), and ads in public places (like billboards or posters) (69%) while the lowest scoring ones include: online pop-ups (25%), podcast ads (37%), and mobile phone ads (39%). This goes to show that traditional marketing is still as beneficial as digital marketing! For more tips on how to market yourself and your business digitally, you can refer to one of our previous monthly blogs: Advertising & Marketing For You and Your Business.

Taking on a new business can be daunting and overwhelming by yourself. Although it is often appealing to independent business owners to do everything themself, (to try to save money), it is in one’s best interest to hire others to ease the load. Besides employees of course, an accountant can be a valuable asset for your business. Accountants guide you in the right direction to make your company more financially well-off. They have detailed experience and save you time by being precise and accurate when it comes to reporting, doing the finances for you (instead of you doing everything yourself), and creating a budget/ plan to put you in the best financial state. In our previous monthly blogs, we cover the differences between CPAs, accountants, and bookkeepers (Accountants vs. CPAs vs. Bookkeepers) more in depth and how to find the right accountant (Accountant Lingo & Finding the Right Accountant). Additionally, don’t shy away from receiving coaching from other successful business owners in your industry. In a study from the Small Firms Economic Development Initiative, 70% of small businesses that received mentorship from experienced business owners survive their first year in comparison to 35% those who do not receive the same type of mentorship.

When others help you in your business, it grants you more time for yourself. Frequently, as an independent business owner, free time is seen as more time to generate more sales. While this is not necessarily false, it is imperative to take time for yourself outside of work. A common quote in the self-care world is, “You can’t pour from an empty cup,” and this means that you can’t take care of everyone else (everything else) unless you take care of yourself first. Additional time for yourself doesn’t have to be staying at home watching TV/playing games all day, it could also look like discovering new hobbies outside of work which could, in turn, expand your network even further. When you are well rested and have a good work-life balance, it, naturally, makes you happier. Happiness is Essential in Work because it motivates you, makes others see you as a better leader, and has a direct effect on employee health and productivity.

Business Success has many Factors

The world is ever-changing and this includes your business as well. Take care to always adapt to new employee & customer feedback and keep up with new trends in your industry. A successful business is created from a culmination of many different factors but by being well-prepared and adaptable to the world around you, you can create a successful business!

Accountant Lingo & Finding the Right Accountant

In last month’s blog, we covered the benefits of having an accountant and what the difference is between CPAs, accountants, and bookkeepers. Now the question is “Where do I even start when looking for the right accountant?” Everything in the accounting realm can be confusing at first or it may simply take up too much of your time. Gaining an understanding of basic terms in accounting may help you feel more secure in your business and even help you find the right accountant.

Finding the right Accountant

If you’re considering an accountant, you may have no idea where to start. A good place to start is overall communication and guidance. Having an accountant should be a vital part of your team and they should be willing to work with you and help you really understand the money side of your business. This means detailing the explanations for any questions you may have and teaching you aspects of money handling so you are able to do some things on your own later on (if needed/desired.) Having good communication goes in hand with availability. Having someone you can never get ahold of can make it frustrating for you in the long run. Remember that relationships are a two way street and everyone should have a good relationship that works for both parties.

Although there are many questions to consider asking an accountant before you hire them; we are only going to review a few that will aid in finding the right accountant for you. Are they willing to teach you about finances and do they offer additional consulting if needed? Do they offer standard packages or can they customize services based on your needs? Are they able to help with 1099s and any further subcontractor needs? Do they have any specialities? When looking at bigger firms it may also be worthwhile to ask if they outsource any of their work or if they perform it personally and if they don’t perform it personally, will the person you deal with change? Will you get a regular person to discuss your finances with?

After hiring an accountant, you’ll want to really dig deep and work towards the best financial plan you can for your business. Here are some things to think about when deciding what you need. For one, contemplate what taxes you’ll need done and what records you need to keep for filing and in case of audits. Whether you do or don’t know what taxes need to be done for your business, an accountant can help you figure it out or even file for you (in most cases.) Next, you’ll want to work with them to better manage your cash flow and know your breakeven point. A break-even point is when sales and expenses are equal. It’s essential to know your break-even point because it can help you figure out a pricing strategy and make your budget more accurate. Working with an accountant should improve your business by figuring out what changes your business needs.

Understanding common terms in Accounting

When you’re new to the accounting world, there are many terms that you may be lost on. Although your accountant should be willing and able to review any terminology you don’t understand, learning some of the basic accountant lingo for yourself can be beneficial to helping you grasp more of the financials of your business. Let’s begin with assets and liabilities. Assets and liabilities show how much your business is worth. Assets are property (either tangible or intangible) that adds value to your business. Assets could include things like inventory, (paid off) vehicles, and even your brand value. Liabilities are any long-term or short-term monies your business owes. Examples of liabilities include credit card payments, bank fees, and loans. Additionally, accounts receivable is an asset while your accounts payable is a liability. Accounts receivable (AR) is the money you owe to any person/vendor while accounts payable (AP) is the exact opposite (so money owed to you by people/vendors).

Another thing you’re going to see or hear about a lot is P/L reports and the balance sheet. P/L stands for Profit and Loss. A P/L report is a report showing all the expenses and income you had in a certain period of time. The balance sheet shows the business as it currently stands including all assets, liabilities, and equity. Equity is money remaining after all liabilities are gone and all assets sold. It basically shows the owner(s)/investor(s) stake in the company. Just like there are different types of assets and liabilities, there are also different types of equity in a business. You can run both P/L reports and balance sheet reports by month, week, yearly, or any other custom setting to find a time you’re looking for.

Accountants and all their terms

Knowing what you’re looking for in an accountant can elevate your business even higher. Don’t forget to check out last month’s blog for all the reasons why having an accountant is valuable in your business! Additionally, having a basic understanding of frequently used accounting terms helps you better understand the money going through your business and further your involvement in your finances with your accountant.

Accountants vs. CPAs vs. Bookkeepers

Accountants, CPAs, and bookkeepers- We’re sure that you hear these words all the time. In the world of accounting, these titles are often bounced around and sometimes interchangeably. Even though they all do many of the same tasks, they are different and it’s important to know their differences.

Accountants, CPAs, and Bookkeepers – What’s the difference?

Let’s start with bookkeepers. Bookkeepers are usually the basis for accounting in business. There is no formal training required to become a bookkeeper and they typically work under accountants. Bookkeepers handle the daily financial transactions and usually other tasks like: payroll, loan payments, creating invoices, and billing. They also create financial reports that an accountant can then review with a client. So onto accountants, accountants can do everything a bookkeeper does but they also have other responsibilities. Primarily, they are there to help with long-term financial planning and any other financial consulting advice. This means that atop of overseeing bookkeeping tasks, they can: create and review budgets, correct any accounting discrepancies, calculate tax liabilities, and give tax advice. Finally, we have CPAs. CPAs are also known as certified public accountants. They can do any tasks that a bookkeeper or accountant can do but CPAs are the only ones who work with the IRS which means they are the only ones that can file yearly taxes for you. Not all accountants are CPAs but all CPAs are accountants. This is because in order to become a CPA, one must have a bachelor’s degree in accounting, a certain amount of hours under a CPA (hours dependent on the state), and pass the CPA exam.

It may be time to consider hiring a professional if your taxes are too complex, accounting is taking up too much of your time, or if the business is growing up. When it comes to choosing the right professional for you, most people go with an accountant. This is because accountants are usually more cost-effective than a CPA and more often than not, they already work with a bookkeeper. Although this does mean you still have to have someone file your end of the year taxes (or you can do it yourself), it can make it a lot easier when you have an accountant who is taking care of your books all year.

The benefits of Accountants

Many of us love to save money any way we can by doing things ourselves. If your business is small enough, this may not be a problem when it comes to accounting for you. In general though, it is always a good idea to have an accountant for your company. For starters, having an accountant can actually save you money because they can let you know where money is being overspent and what software/programs could save you when doing payroll, inventory, and more. Not having immense knowledge in accounting could also cost you more when it comes to taxes. Common reasons people lose more money in taxes is because they file late, miscalculate their tax bill, or lose out on tax breaks by not claiming them. Next, one of the biggest upsides to having an accountant is that they save you time. If you make any mistakes, it could take hours to fix that could be avoided or handled by an accountant. Also, when you have more time, you can focus on generating more sales or simply putting more time into needed areas of your business. Furthermore, many people use their free time at home to crunch numbers and do all their accounting. This free time could now be used to focus on their families even more or their personal life in general. After this, having a long-term accountant comes with its own set of advantages. If your accountant has been in the industry for a long time, they usually have a vast network of different business professionals. This means that the accountant may have more knowledge on your profession and if they don’t, they can reach out to a specialist in their network and get the help they need to help you. Finally, as the accountant learns more about your books, they become a specialist for your business. They will start to see trends, places to improve, and what could be damaging if continued. They grow with your business and will be able to better predict how new products (or other big business changes) will affect your business.

In Summary

No matter what accounting professional you choose, spend time picking the right one as they save you time, money, and peace of mind!