Getting More Done… The Key To Using A World WorkForce

Remote business management conceptIn the business world, any opportunity to achieve more in less time is a winning idea. In that vein of thought, many small businesses and CEOs alike have employed the services of virtual professionals, to their success. When confronted with tasks requiring skills that you do not particularly possess or excel in it can be easy to get overwhelmed. The availability of virtual professionals capable to perform nearly any task, at any time to bridge the gaps in your business needs is a boon to all solopreneurs. In addition they tend to cost a literal fraction of the expense required for hiring an equally skilled part-time employee or other standard fee for service negotiations. Freelancing is no longer limited to writers and the occasional odd jobs. It has instead blossomed into something greater thanks to the advances of technology and several platforms that organize and enable you to be truly discerning in your choice of worker whether you are in need of a realtor or a secretary.

Workforce at the Touch of a Button

Engaging the world workforce does not involve trusting your time-sensitive business needs to the random Joe Schmo from craigslist or the like. In most cases you can request credentials from potential applicants, even proof of degrees and certifications if you so choose. In fact, sites like Upwork.com have a very extensive process available to businesses which enable you to be as in-depth in your hiring process as you desire. This makes it easier for you to access and utilize the available fractionalized resources for skills you currently do not have. For example, you can select your potential favorites from a list of applicants and resumes for your required project, personally interview those you choose online, discuss payment terms with each individual and even analyze their past feedback reviews. The platform offers a very wide-range of specialties from professional writers to mobile developers and marketing experts. Whether you need one person or a large, organized team to tackle your project it is all available. Satisfied with the work completed? Easily add favorite workers for quick and direct access for future or continuous projects.

Quality Guarantee

The large majority of freelancing platforms ensure you get the quality you demand before you ever pay a cent. Your business won’t end up stuck with the bill for poor quality results, and oftentimes you are given the ability to request revisions and corrections for as long as it takes. If it doesn’t work out, you don’t pay, simple as that. Hiring freelancers for your

business needs has exploded in popularity and for good reason. The money saved from doing away with a lengthy hiring process, providing benefits and training of a new hire is profit made. Being in business for yourself doesn’t have to mean being bogged down with menial tasks when your time is worth more and better spent. So don’t overlook the readily available world workforce available for your business needs whether large or small.

Stop Overpaying Your Small Business Taxes, The 12-Month Plan To A Happy April 15th!

Tax form conceptApril 15th!

If you are a small business owner, you have probably taken out a loan from time to time. As part of the terms of repaying that loan, you had to pay a significant amount of interest. That’s how loans work. You borrow an amount and repay that amount plus interest. So, why do you let the government borrow your money interest-free? Overpaying your taxes allows the government to use your money. Money that you could use yourself.

The odds are that your small business needs to make the most out of every dollar. Reducing costs is certainly one of your major priorities. Often small business owners leave on cost reduction on the table. They overpay their taxes. How can you avoid overpaying?

Record Every Expense

Make sure you keep accurate records of every expense. Get professional help in understanding what deductions are available. When in doubt, keep the record and do some research to check if the deduction is allowed. It’s important to consider that tax law changes from year to year. Maintain a current understanding of tax credits and allowable deductions.

Avoid sending up any red flags by understanding some of the more common traps. These traps include the home office deduction, the ambiguous miscellaneous deduction, and the often blurred lines between business and personal expense deduction.

Pay On Time

Paying on time will ensure that you avoid costly penalties. As we all know, April 15 is tax day; however, owners of small businesses are considered self- employed. That classification means that you must pay estimated quarterly taxes plus quarterly self-employment taxes. Paying these taxes late might get you audited and can you leave you liable for interest penalties.

Planning Ahead

Paying estimated taxes can get confusing. One of the easiest methods is to start with the amount you paid the previous year adjusted for any changes, or predicted changes, like growth or additional expenses. Once you decide on an amount, spread that number over the 12 months of the year, and you know what you will need for each quarterly payment.

Professional Advisor

Each year around tax time you hear a lot of political talk about reforming the tax code. In its current form, the tax code is unbelievably complex and at times impossible to understand. Investing in the services of a professional tax service is one of the wisest moves you can make. They can help you keep more of your money to use in the financial management of your business. Yes, it will mean an added expense but one that will pay for itself many times over.



Managing Cash In Your Business – by Eric Brown

Sometimes business owners feel that if their company is profitable, all is well. Such an attitude may lead to a false sense of confidence, however, when the dynamic relationship between cash flow and profitability is misunderstood. Which is ultimately more important to the ongoing success and survival of a small business? Of course, profitability and cash flow are interdependent, so it is essential that business owners not get so focused on the profits that they neglect cash flow management.

In our current economy, even a profitable business could quickly find itself lacking cash on hand for necessary expenses. Imagine your business facing this scenario: Your customers have decided to renegotiate their payment terms and expect 45 days or more to pay on current invoices. At the same time, your vendors are now demanding you pay them on shorter payment terms. You pay employees bi-weekly, and it just happens to be one of those few months in the year during which there are three payroll cycles. In such challenging circumstances, a business owner that hasn’t properly managed cash flow may find it necessary to borrow money just to get through the month.

Owning a business myself, I have had to grapple with cash flow management decisions while striving to run a profitable company. To gain some insight into successfully navigating this tricky terrain, I spent time discussing these issues with some local CPAs and a commercial banker.

Joe Witt, Executive Vice President of Corporate Banking at Old Point National Bank, who is also a CPA with an MBA, has a unique perspective on this topic. Witt states simply, “Cash is king, and as we hit hard times, it becomes more relevant. Understanding how cash flows and turns in a company is critical.” He suggests using some metric tools such as “Days to Cash” to measure this activity. This approach examines three specific things on a balance sheet: receivables, payables, and inventory (if your business has this). Successful management of these areas of your business will reduce the need for working capital.

Witt offers the following suggestions:
• Speed up your billing process—invoice weekly
• Utilize remote deposit capture—scan checks and deposits from your own office
• Offer payment options via ACH or credit card
• Manage inventory efficiently—have less on hand for slower-moving items
• Get better payment terms with vendors—longer terms when possible

“Often business people are interested in the sale, but do not manage the process to collect it,” according to Witt. “There have been more businesses to go under because of lack of cash versus a lack of profit.”

Jeff Karr, CPA with Goodman & Company, describes profitability as the foundation of your cash flow, but he emphasizes that how cash is used is most important. Business owners must be strategic about how they reinvest cash in their businesses. Karr understands that some owners do not like to have debt and have decided to pay for new equipment (for long-term use) with cash, but such a company may be highly profitable, yet have no cash. Then comes time to pay taxes, but there is no cash to pay for them, which further compounds the problem.

To avoid finding your business in this situation, Karr suggests using financing to secure long-term assets instead. Karr asserts, “If business owners borrow the money for long term assets, their return on that investment is bigger than the interest expense they are paying because they can’t grow without that piece of equipment.”

Some recommendations from Jeff:
• Get discounts from vendors for early or prepayment
• Utilize sweep accounts when viable
• Know your customers’ ability to pay—if you have think twice whether to do business with them, don’t!
• Avoid taking work at or below cost just to keep your people busy.

Patrick Shuler, CPA with Goodman & Company, believes that if a business owner uses of a line of credit, it should be utilized for short-term cash needs and not long-term assets. Take a pulse of your business by matching up your assets to liabilities. Shuler asserts that your receivables, inventory, and cash on hand (current assets) should always be higher than your current payables and line of credit. Failure to keep these areas in the appropriate balance could result in a weaker financial position overall. “You don’t want to get flip-flopped where you are owing more than you’re generating,” Shuler says. A business may be profitable yet faced with trying to reduce debt from previous years’ activities, resulting in even more adverse consequences for tax planning and debt reduction strategies.

Another interesting perspective Shuler offers pertains to the cost of bringing in new business. He explains, “With new clients, you typically don’t have as high return on your investment as compared to your long-term clients because it takes time to recoup startup costs for new ones,” says Shuler. Businesses need new clients, but when working with mid- and long-term clients, you clearly must understand their pay cycles and what it really costs to handle their work.

Shuler’s recommendations on managing your business:
• Perform credit checks on potential clients
• Request advance or short payment terms for new business
• Focus on growing your business by developing the relationships you already have and   creating long-term client relationships

I believe it’s important to regularly evaluate the financial health of my business, and I have learned over the years that neither profitability nor cash flow alone is an effective measure. Instead, business owners must consider both of these factors as they relate to one another and use the information gathered to make judicious cash flow management choices.

Joe Witt may be contacted at jwitt@oldpoint.com

Jeff Karr is at jkarr@goodmanco.com

Patrick Shuler is at pshuler@goodmanco.com

ERIC BROWN, CEO of Mobile One Courier & Logistics, started his company 14 years ago as a same day courier service. Today in Hampton Roads, Mobile One has a staff of over 60 people. Diversified in providing total logistics solutions for businesses, Eric’s company specializes in providing distribution, warehousing, and fulfillment solutions. Eric hopes to help businesses grow more efficiently by leveraging their time through outsourcing. This can ultimately help companies to grow their top line and focus on their core business rather than their “backroom.”

Exert YOUR Independence in your Business. Imagine higher profits by September….

“All mankind is divided into three classes: those that are immovable, those that are movable, and those that move.” ~ Benjamin Franklin

Can you imagine MOVING your business to the next level in as little as 100 days? Imagine finishing up the third quarter of 2011 with a glowing PROFIT…

Yes, that is what many previous attendees of 100 Days to Abundance have experienced for themselves.

How about you? Is it time to take the leap and experience 100 Days to Abundance? This is the LAST in person class that we will be offering.

I will make room for you if you are interested. Comment below or email me at bdavis@tnofnc.com