Tuesday, November 11, 2014

Another business fails due to poor planning

We lost another popular business in our area and I assume it is due to a lack of planning.  The business had a loyal following and ran smoothly so they decided to expand.  The original location of the expansion didn't work out, so they moved.  That location also had difficulties and the owners were unable to manage the increased staff and hours.  Service was poor at the new location and they quickly ran into cash flow issues.

As a result, the business had numerous dissatisfied customers and had to close.  The bad publicity will make it difficult for the owners to start up again even if they can get the working capital to do so on a smaller scale. This could have been avoided if the owners had taken the time to really research the location of their expanded business and determined if they had the time to manage both locations.  There are many entrepreneurs who think they can do it all and when forced to actually map out the amount of time each task takes and the amount of time they actually have available, realize that they must delegate.

The community is saddened by the loss of the business, the owners are in trouble financially and the employees are out of a job.  Planning is important!

Wednesday, October 22, 2014

How paperwork can save you time and money!

We have had a couple of clients where we stepped in blindly as their previous, in-house accountant left unexpectedly.  We found in both cases that we were operating blindly as those previous accountants had left very little behind to guide us. We found no contact lists, no standard operating procedures, very little paperwork.  We were fortunate to have a list of logons and passwords for one client and had the use of an excellent IT person at the other, otherwise we had to start from scratch.

As a result, each spent a great deal more for our services than they would have if there had been a binder.  Such a binder should contain key contact people (customers, vendors), key accounts (bank accounts, investments, credit cards, loans) and the contact people for the key accounts.  There should be a listing of all key logons/user names/user IDs as well as passwords.  Obviously, this needs to be locked up for security reasons.  Another important section would have important dates-when are bills due, what is paid automatically and what needs to be processed for payment.

Think of the peace of mind that will result if such a binder exists.  It will take some work to create it and keeping in updated will be important.  It can save a business time and money to establish it so get started today!