Archive for June, 2010
Bookkeeping Services for Your Business
Bookkeeping is one of the most important parts of making a business successful. It is of course possible to run a business which has substantial costs, but if these costs are left to spiral out of control and exceed the revenues, then you will probably make a loss and at the same time be ‘out of pocket’ in cash flow terms. A majority of business owners are not sure how to select a suitable bookkeeper or bookkeeping service for their businesses. Detailed below are a few helpful hints to bear in mind when choosing a bookkeeping service for your business.
Choosing the best bookkeeping service depends on the size and the type of the business and there are a number of options that are available. Some business owners may be willing to input the basic information into a computer by making use of bookkeeping programs such as Quick Books or Sage and others may just collect the receipts and the bills and take them for processing to their accountant.
Therefore, choosing the best bookkeeping service greatly depends on how much you are willing to do yourself for the business and on the level of service you need. There are business owners who use a full service bookkeeping service, while others prefer to use such a service only for taxes and payroll.
When you choose the bookkeeping service for your business, you should try to get one which suits your particular type of business or industry. For instance, there are specific accounts packages for doctors and letting agents. Therefore, if you are looking for a full bookkeeping service for these types of businesses, it would be a good idea to find a bookkeeper or accountant who specialises in these industries. Furthermore, it would be sensible to also check whether the bookkeeper or accountant have adequate personnel to help you whenever you have questions. You will have to establish from the beginning if they will come to your location or if they will be downloading all the information from your computer and processing it back at their office. Indeed, where you prefer them to undertake the bookkeeping will depend on the space and resources you have available, as well as practicalities of being available to answer any immediate questions any service provider has.
Recommendations are a great way to find a reliable bookkeeper and bookkeeping service. Ask friends and family or business colleagues who they use, as they will hopefully be able to give you an honest opinion. Any bookkeeper you choose should have a good grounding in accounting standards and basic tax laws. Most importantly you will need to feel completely comfortable when discussing the finances of your business with them. There is nothing worse that ‘frozen communication’ between a bookkeeper or an accountant and a client.
The best bookkeeping service for you and your business is one where the bookkeeper is honest, dependable, understands your business or industry, understands the fundamental accounting and tax treatments for transactions, and is able to communicate efficiently and effectively with you in a comfortable manner.
How Management Accounting Can Be Used to Help Your Business
Management accounting is the technique of gathering and recording information which aids the decision-making capability of management. Indeed, management accounts can help management and business owners make better operating and strategic decisions. Furthermore, banks and other financial institutes sometimes require management accounts on a regular basis to assess their continuing lending terms and conditions.
A good management accounting process is one that helps to tackle four key aspects of a business:
- Planning
- Directing
- Decision Making
- Controlling
The following are ways in which management accounting can help a business:
- It provides accurate information related to the budgeted and actual figures, thus enabling the managers and business owners to take proper cost controlling measures.
- Provides timely feedback related to current operational activities, therefore helping in reassessing the operational decisions and gaining better control over the activities of the business.
- Assists in measuring the performance of various departments and sub- units within an organisation. This information can then be used to identify and reward the better performing departments and employees. For example, a certain employee may be responsible for higher sales figures than expected and as a result you may choose to promote him or her to oversee the other sales staff.
- Helps management or owners do a complete 360-degree analysis of the organisation. In this sense the management accounts can provide very useful information when looking at the business plans of an organisation and when carrying out any SWOT analysis (the Strengths, Weaknesses, Opportunities and Threats facing a business).
- Identifies profitable and non-profitable products or services. For instance, this can help speed up process of discontinuing a certain product that is making a loss and this in turn will can save money.
Management accounting not only covers financial records but can be applied all over an organisation’s activities to identify areas where things may be going wrong and need improvement. It is a vital tool in helping businesses achieve their goals and for streamlining any processes which are inefficient.
Management accounting should not be seen as something just larger businesses need to do. Any business, no matter how big or small should prepare some form of management accounting information, even if it is just written down on one piece of A4 paper. Management accounting can give you a “snap shot” of how your business is performing throughout the year. It will allow you to compare your actual performance with the expected performance, help you make improvements to your business and streamline your future plans.
Keeping it in the Family – How to Help a Family Business Succeed
Accountants in Birmingham – Family Business Advice
All businesses have a life span, and all move from their inception through various phases until they either end or are converted into different entities entirely.
For most business owners, their relationship with their business will also have a natural duration, from the time that they acquire or start the business to the time that they close or sell it, but for a family run firm there is often something else going on that puts a whole new spin on things. Sometimes the business has been handed down through many generations, from parent to child perhaps, and often the expectation is that this legacy continue in the same vein for further generations to come; because of this emotions often run higher in a family run business than they ordinarily would, as far more than simple time and money is invested in the venture’s success.
To add to the emotional mix, we quite often see family members working along side each other, day in and day out, spending their entire working lives in very close proximity to their nearest and dearest; this, of course is sometimes the strength of family run firms, but it can also be a volatile cocktail.
However hard it may be, it is therefore, quite sensible to attempt to emphasise the ‘business’ part of the family business and try for a more professional work environment.
There are a few things that can be very effective when endeavouring to run your family business with less domesticity:
Work/Home Divide
Even business owners who don’t work with their families can have trouble with this one, but, if you are employing relatives or working alongside a partner or child, having a time and place for domestic matters and a separate one for professional can be a life saver. No matter how easy it is to carry on the row from breakfast during your working day, it is incredibly important to save it for after your working hours, and conversely don’t expect to sit around the dinner table and have an informal staff meeting, a family life that is kept just that will provide a refuge from the stresses of work.
Formalise It
Just because your manager is your sister or your payroll clerk is your cousin, it does not mean that they should be working without the protection and benefits that other staff usually enjoy. Having contracts in place will give you all a professional document to act as an inanimate intermediary should problems arise.
Outside Assistance
Although it is tempting for many reasons to staff every role in a family business using family members, it can be a useful tool to employ specialist help for roles requiring particular know-how; not only will it mean that you don’t end-up with an unqualified relative struggling with a job that they are not fit for, but it will also bring in non-family members to redress any bias the business could be suffering from.
There is obviously a certain strength in family firms that allows so many to thrive for generations, but this type of working is not for everyone and for every family business success story, there is a tale of the child who went his own way and upset the apple cart. It is therefore worth remembering that just because Grandma made the firm a success does not mean you automatically can; just as with any other business, the family business will only succeed with plenty of hard work.
Great Ways to Conduct Market Research For Your Product or Service
Accountants in Birmingham – Market Research
Market research is an approach for gathering data related to products and services. One of the major reasons for conducting market research is to determine the success or failure of a product or service. In other terms it can be considered as a precautionary measure which can be used to forecast the potential of a new product or service.
Good market research is usually undertaken with the following 3 step approach:
- Plan
- Gather
- Analyze
Proper planning should be done before starting any market research, which should include well-defined objectives, the actual purpose for conducting the market research, what kind of inputs need to go into the research and who will be responsible for it. Once a formal plan has been finalised you can move on to the next step of information gathering.
Information or data gathering can be done in many different ways, depending on the product or service for which the market research is being conducted. Some of the most common ways of gathering information for this purpose includes:
- Questionnaires
- Surveys
- Interviewing experts and common consumers
You can choose the best method depending on the type of market your product is intended for. For example, if it is an online product, the focus should be geared to Internet based users and information gathering techniques like online questionnaires and surveys need to be used.
The final step is to analyze the information or data which has been gathered. Well-gathered information should be able to clearly answer the following questions:
- How would the product benefit the customer and the company?
- Who are your competitors?
- What type of advertising strategies could be used?
- In what way is your product or service better than those already available on the market?
- Who is the target audience for your product or service?
Once all these questions have been answered, you should have a clear understanding of the customers’ preferences. Therefore, you can then start deciding on your launching and pricing strategies and how to position your product or service in your chosen market place.
A well-organised and well-planned market research campaign is a crucial step to take when evaluating your product and service and its potential impact on the market place. It can give you external intelligence as to what your potential customers require, what they are prepared to pay and what competition you will be facing, among other things. However, like all other aspects, any market research needs to be planned properly with major emphasis on the best ways to gather and analyse the information you are after.
The Business of Being Green- How to Make Savings in Business by Recycling
Accountants in Birmingham – Cost Cutting
We are all now far more aware of how to do the best for our planet; we understand that our resources are dwindling and even if we are not wholly green, most of us do our bit to separate plastic and paper from the rest of our refuse. Bottle banks have now been around for so long that the very idea of putting glass in with your household waste is a strange and ancient philosophy from another time.
The business of recycling is booming and many commercial enterprises have sprung-up to profit from the world’s desire for change. With specialist recycling companies making money out of the re-use of stuff otherwise destined to be land fill. Other businesses have realised the fashion for all things green and have developed new and artistic products using our rubbish.
The manufacturing industries are just starting to realise that there is profit in their waste, with the many by-products of manufacture now being sold on to others as products they can use, and everything from precious metals extracted from used car parts to gypsum from old plaster board being used to create new cash streams.
Setting aside the obvious need for the planet to recycle what limited resources it has left and the fact that most of us, especially in the business world, could probably do more to help; there are other very good reasons why businesses should look at recycling, not least because of the tremendous savings that can be made by being more sensible about waste.
However, do not think that it is only big industry that can turn their wasteful practices into revenue. All businesses even the smallest can make a saving by adopting greener working habits.
If your business sells a product that can be refurbished, reused or recycled or contains a salvageable material, then it might be possible to set-up a customer part exchange program, allowing them to return their used product for a saving on a replacement; this of course has the added benefit of keeping your customers returning to you for new business, as well as the money you can make from the scrap.
If you are in a service industry, examine areas of waste that will bring your overheads down as well as reducing your carbon footprint. Most business use far too much paper for instance, but rather than simply putting used paper in to a recycling bin why not research the various ‘paperless office’ systems now available. Moving to new technologies will enhance your business in other ways too.
All businesses could look at their transport policies to see if savings could be made and encouraging staff to get involved with car shares etc. will enlist the help of the whole business in your money saving activities.
Along with the obvious warm feeling that doing the right thing for the planet will bring and the extra streams of revenue or significant savings to overheads, trying to be greener also has the unavoidable knock-on effect of making your business more attractive to customers by improving its profile. It is after all good to be seen as a caring business in a world where business is very rarely viewed this way.