A few years back, SCORE conducted a poll asking entrepreneurs what was the worst part of owning a small business. A whopping 40% answered bookkeeping and taxes.
That survey wasn’t an anomaly. In that same year, TD Bank asked over 500 business owners that same question, with 46% listing bookkeeping as their least favorite task. A 2012 survey by Mavenlink had 41% of respondents giving that same answer.
So, it’s no wonder that so many small businesses put it off for as long as possible. If a person despises doing something, it’s not exactly going to jump to the top of their to-do list. Unfortunately, this can have a severely negative effect on a business’s performance.
So, what can be done to fix it? Short of miraculously developing a passion for accounting, what are some simple tricks to reduce the pain around bookkeeping?
One thing that has helped a lot of our clients is understanding why they’re doing their books in the first place. To be able to file their taxes? To provide records to a bank for a loan? To give something to their annoying CPA to get them off their backs?
Sure, all of those things are real reasons. But they are far from the primary purpose that bookkeeping serves.
Accounting is called “the language of business.” A business’s books are the truest reflection of its operations. They show the successes, the failures and the opportunities. They provide data on cash flow, receivables turnover, seasonality, and the profitability of different products and services. They give a snapshot of the business’s performance – all backed up by cold hard data. As a friend of mine bluntly put it, “If you don’t know your books, you don’t know your business.” They can and should be …Read More
Now, we live in a time when there is an app for any productivity issue. We can choose from thousands of solutions, each boasting impressive features that help people accomplish more in less time. One such solution that’s making waves is blockchain.
Aided by the meteoric rise of bitcoin, blockchain has technological applications that make it a viable resource for any number of industries in which transparency matters. As the food services and healthcare fields show, though, blockchain and technology in general is not a silver bullet. While it has potential to effect change, blockchain can’t be the cure-all you might expect if you don’t apply the necessary context.
Supply chain transparency is a must, especially as it relates to food and health. Take, for example, E. coli. A 2015 outbreak of the bacteria contaminated Chipotle restaurants across 11 states, and E. coli concerns led to three recalls of romaine lettuce in 2018 alone. Recalls, besides being a major health concern, pose the single biggest threat to food vendor profitability, according to Food Safety Magazine.
In healthcare, opaque supply chains lead to other issues. Stolen prescription drugs are contributing to a well-documented opioid crisis in the U.S. In addition, fraudulent billing costs around $455 billion worldwide.
While blockchain can help each industry prosper, there are still questions that both healthcare and the food industry must address as to how blockchain aligns with their goals. For leaders in other industries considering blockchain adoption, ask yourself these four questions to determine if it’ll yield the results you envision.
Blockchain has the potential to serve as a global supply chain operating system. If your business sells high-quality goods and it’s vital to know where they are every step of …Read More
In such scenarios, raising loans through banks for small business or relying on individual investors becomes unavoidable. However, raising small business loans poses a challenge for startups, and business owners struggle to find the right capital structure or funding mix for their company. Differentiating between the two funding options, debt and equity, raises issues. In this regard, a clear demarcation between the two and the cost of capital to be incurred will help entrepreneurs make the right financial decisions, ensuring business growth and higher valuation.
Debt financing is a process of arranging funds for your business through borrowings. These borrowings can be in the form of secured or unsecured loans that will eventually have to be paid back to the lender at a certain interest rate. On the other hand, equity financing is a process of raising funds by selling off part of stocks of your business, or shares. Under this type of funding, ownership of the business is traded off in return of funds.
While the key underlying difference between the two types of funding structure is clear, further distinctions are vital for an entrepreneur to make the right decision.
In the case of debt funding, the downside is the payment of interest, which results in a greater sum than the amount repayable to the lender, making it a costly proposition. Moreover, the loan has to be repaid regardless of whether your business generates revenue. On the other hand, equity funding dilutes ownership and reduces the controlling stake in the business. The main obligation under equity financing is the need to generate consistent profits to distribute dividends.
Further, debt financing offers the benefit of tax deduction, as interest paid on debt can be deducted from a …Read More
Franchisees usually benefit from a ready-made, tried-and-tested business model from the franchisor, which often includes a known brand, marketing strategy, and benefits associated with economies of scale when buying supplies and other relevant business inputs.
That package of goodies, however, doesn’t come without a price tag – sometimes a hefty one, depending on the franchise brand you want to associate with. In addition to a franchise fee, which typically ranges from $20,000 to $50,000, franchisees often have to meet contractor and professional fees, as well as costs associated with signage and inventory. As with any other business, they also have to raise sufficient working capital to launch the business and keep it running until it breaks even.
Franchisees must always be on the lookout for funding opportunities to help with some of these costs. Because of the highly competitive nature of business funding, it pays to build a business that will not only get loan approvals from banks and other traditional lenders but also attract independent investors, including private equity firms that might have more favorable lending terms.
Editor’s note: Looking for financing for your business? Fill out the below questionnaire to have our vendor partners contact you with free information.
Here are a few tips to help you build an investor-friendly franchise business.
When you’re looking to bring investors into your franchise business, remember that you’ll be adding another independent party, the investor, into an already complex web of interactions. To ensure things run smoothly, it’s crucial to take up the services of a franchise attorney from the get-go who will help with things like the franchise agreement, the franchise disclosure document, and issues of liability that often carry serious implications for franchise businesses.
Liability issues can weigh heavily on any business, …Read More
Despite the rising prevalence of blockchain in today’s world, it still isn’t enough to push blockchain at the forefront of investment. More startup companies are turning to outside funding in order to gain the money they need to run their digital business.
Unfortunately for them, it’s not that easy to ask investors to fund a blockchain startup. This is what blockchain investors look for in a startup before they decide to take the plunge.
Blockchain may be an innovation all in itself, but that isn’t enough for investors who want real innovation from an individual company.
Real innovation, in this case, can be defined as something new and unique that a company has managed to come up with using current or upcoming technology. Blockchain is a technology that can potentially contribute to the modernization of our businesses and our economy. And it’s involving very fast.
Based on this statement, it would seem like investors are the ones not having enough projects to invest in. If entrepreneurs can focus more on developing their blockchain-capable businesses more, they will be able to attract investors who are specifically looking for something new created out of blockchain technology.
Investors are not interested in using blockchain in isolation. They are interested in seeing how blockchain can be used in relation to other technology, such as artificial intelligence, for instance.
Although both have remained as standalone technologies in the last decade, more and more academics have been trying to combine the two. The convergence of blockchain and artificial intelligence could lead to several benefits in various sectors, including healthcare and finance, the two sectors that see the most identity fraud cases in recent years.
With blockchain and AI integrated together, companies in these sectors can create an encrypted method of storing sensitive …Read More