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20
Nov
Read MoreWhy you need cloud accounting
If you read the business pages, you’ll notice the rise of cloud accounting systems, and perhaps you are wondering what the benefits might be to your business. Today, I’m going to help you strip down the hype and show you how cloud accounting can really help your business
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15
Nov
Read MoreCentury old orchard goes virtual
One of the biggest kicks we get at MYOB is when we help business owners grow their companies. Today, we are featuring Turnbull Orchards, a family business that has been around since 1892 - a whopping 120 years. Turnbull Orchards has recently gone online to make sure their customers get the best pick of cherries this summer. MYOB CTO Simon Raik-Allen chats to Phillip Turnbull, a 3rd generation food grower on cherries and cloud software below. AUDIO: Century old Turnbull Orchards goes online
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04
Oct
Read MoreEight Tips on Managing Your Cash Flow
Whether your business is growing or struggling, managing your cash flow effectively is absolutely essential, and for many, the very key to business survival. You've probably heard the statistic that over 60% of businesses that go bust are still profitable, but just ran out of cash. From a cash point of view, a business is like a sponge—it sucks in ever increasing amounts of cash, and, to get it back out again, you have to give it a good squeeze. If the business is growing rapidly or badly managed, squeezing hard won’t help, as the sponge will just get bigger and bigger! Understanding and accepting the amount of working capital a business needs to operate is the first step. How much inventory do you hold? How far behind in invoicing are you, or how much cash is tied up in work in progress? What do your customers owe you? How long does it take from paying your suppliers for the materials to extracting cash from your customers? All these will soak up your cash like rain in a desert. Next, ensure your business has enough cash to fund your working capital needs. They used to say to keep three months worth of outgoings in the bank for a rainy day. That may be a thing of the past, but if that’s the case with you, make sure you have a buffer of some sort, either personal funds available or an overdraft or revolving credit facility. Or maybe cut your drawings, as retained profits are by far the best and cheapest source of working capital. Then, plan ahead. It’s no good finding out in your down season that you can’t survive until things pick up when you've already reviewed and agreed your borrowing facilities with your bankers at your annual review some months ago. Prepare some cash flow forecasts for the coming year. If you find it difficult to predict your sales, complete all the outgoings first, and then see what sales you need to cover your outgoings. At least then you have a known target. Plan month by month, too. An excellent client of mine uses a monthly spreadsheet template to predict whether their business can pay the bills on the 20th. This works well—they had a shortfall in August and couldn't pay their Provisional tax. But, because they knew in advance, they consulted me, and I arranged Tax Pooling to cover the tax. Problem sorted, and no last minute panic and stress! Review your systems, which are so commonly poor in SMEs. Do you forget to invoice customers? Do you invoice as you go or just at the month end? How quickly do you collect your accounts receivables? Many do not even know how much is owed to them by their customers or how much they owe to suppliers. Do you capture all time, costs or disbursements to invoice? When was the last time you checked suppliers costs to ensure you haven’t been overcharged or been billed for items you haven’t received? Speed up your cash conversion cycle, which measures the time span between a business disbursing and collecting cash. 180 days or more is very common, especially in manufacturing or businesses with inventory. Ask for a deposit, put customers on retainers or get them to pay monthly. Cut your inventory levels, maybe by arranging for your suppliers to deliver the same or next day, or negotiate longer payment terms. They say that Dell and Amazon have negative cash conversion cycles—how neat is that? Make it as easy as possible for your customers to pay you. Always quote your bank account number on your invoices, and ask for direct credits or automated payments. Accept Eftpos and credit cards, and set up a PayPal account on your website. Why wait for a cheque to be posted in this day and age? Always be on the lookout for ways to cut costs or improve revenue. If something or someone doesn't save money or boost income, do something about it. Review your suppliers, phase out products or service lines that don’t fully contribute, fire your ten worst customers (oh what bliss!) and bite the bullet with difficult or unproductive team members. As the name suggests, cash management is all about managing your cash flow by understanding how a business works, having access to adequate working capital and adopting a planned and proactive approach. Running out of cash is stressful, embarrassing and not good for one’s well being, not counting the additional costs and finance charges that generally follow! Nick Roberts | Owner | Accountancy + Business Advice Centre – Empower Your Business
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20
Sep
Read MoreDesigning an ergonomic home office
In a recent post on challenges in running a business from home, I included as one of the key challenges the risks of stress, ill health and strained relationships from working excessive hours. I realise now I could have added the risk of working in a home office space that has not been set up to be ergonomically helpful—in other words, with everything arranged so you can interact with that environment efficiently and safely. So what would that involve?
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11
Sep
Read MoreHow can collaboration tools make us more productive?
If your business relies on teamwork then you should be looking for better ways to work together. The term collaboration has become another one of those Web 2.0 buzzwords, but it simply revolves around the age-old concept of working effectively as a team. In the internet age, collaboration combines online communications with powerful tools which let us see what others are doing and even work together on documents.
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22
Jun
Read MoreOnline Accounting: What Dreams Are Made Of
One of the lessons I have learned as a business owner is to continually assess ways to eradicate administration. The paperwork and correspondence associated with running a business soon shatter any fantasy associated with the freedom of being an entrepreneur. When I was a little girl, I distinctly remember dreaming about having my very own office. This marvellously organised hallucination was complete with labelled dividers, colour-coded manila folders, and matching stationery such as a sticky tape holder, stapler, pens, and ruler. I am the first to admit I still get an irrational satisfaction when purchasing pens, notebooks, paper diaries, and every kind of office supply. Staying organised is still one of my greatest desires, but it doesn't come as naturally as a little girl’s daydream. Now that I’m all grown up, I delight in running my own marketing agency. But if you are an entrepreneur of sorts, you may have discovered the same thing I did: Not long after the dream of running your own business came to reality, you woke up in a bookkeeping nightmare.
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