An Ounce of Prevention is Worth a World of Cure
“I have found no greater satisfaction than achieving success through honest dealing and strict adherence to the view that, for you to gain, those you deal with should gain as well.” –Alan Greenspan
The sad fact is that over 50% of small businesses fail. You want to avoid becoming part of that statistic. And understanding key reasons why businesses fail will not only help you better manage your business, but it can make you an incredible asset to your small business clients who will want you to tell them if you see early signs of failure. It can also help you to gain new clients who want an accountant or bookkeeper who will not only prevent business failure but encourage an increase in profits. Here are 5 things to look for in order to help you do just that:
Ineffective accountingPoor money management is one of the key reasons small businesses fail. This can manifest itself in a variety of ways. For example, a business can falter when the owner insists on doing the accounting him/herself when that is not his/her specialty. These business owners need to realize that they should focus on what they do best: supplying the product and/or service. This is where you are able to step in and suggest outsourcing the accounting and/or bookkeeping to someone who could become the business’s profit center expert (i.e. you). You can make the difference of whether a business succeeds or fails!
Ineffective accounting is also manifested when the accountant/bookkeeper isn’t using their information to help business owners increase profits. Accountants and bookkeepers have access to crucial financial information that, when analyzed properly, can inform business owners of key decisions they can make to improve their business, making it more profitable. You have the overall view of what’s coming in and going out of the business, you can give suggestions and recommend actions to be taken because of that special perspective.
Insufficient trainingFor those who are running their own business, at times, fail to get the proper training they would need to remain successful at what their doing. As a Professional Bookkeeper you can rest assured that your training is the best available today. Click Here to find out more about our comprehensive training program. It is always smart to keep current in your field of labor and with the newest innovations happening in the industry. Most small business owners feel that they are too busy to do the continuing education. However pretty soon they could be busy doing nothing as their business folds under for being out-dated.
Insufficient salesThis is a serious problem that a good accountant or bookkeeper would recognize when managing a business’s finances. When business owners also recognize this problem they can take action to resolve it. Is there really a need for this product and/or service? Are they charging too much for their products and/or services? Are their marketing efforts lacking or misguided? Accountants and bookkeepers earn their keep when they not only recognize this problem but help diagnose its cause. Because once a business owner recognizes that their business is suffering from poor sales, they can create a solution for it.
Unpaid creditorsAnother red flag that a business is failing are unpaid creditors. And that problem escalates when one of the creditors becomes the IRS. Owing the government money in addition to key creditors can make business owners feel like they’re being chased by a semi; it’s difficult to get ahead when you’re weighted down by debt. Business owners facing this problem should make designing a plan that eliminates this problem top priority.
Nonpaying clientsWorse yet is when you’re doing a lot of work for clients who aren’t doing a lot of paying. And this coupled with unpaid creditors makes it nearly impossible to become a profitable business. In order to cut back on the number of nonpaying clients, run credit checks on potential clients before you admit them to your roster. While it won’t guarantee that a good potential client will continue to be a good client, it can eliminate some of the risk. But when nonpaying clients become your problem, take steps to collect payment. If necessary, enlist the help of a collection agency.
Poor marketingThis is a weakness that plagues many small businesses. Unless the small business is marketing firm, chances are the owner doesn’t feel he/she knows enough about marketing to put forth a solid and effective marketing plan. And while good products and/or services sell themselves in theory, the reality is that costumers can’t purchase something unless they know it exists and who is selling it. Small businesses without a marketing plan won’t be in business for long.
UAC Can Help Accountants and Bookkeepers Improve Their MarketingDon’t miss the marketing “train”! If you find that your business is weak in the marketing department, then you need to make changes before that becomes a significant problem that hinders your profitability. Universal Accounting understands that marketing can paralyze some accountants and bookkeepers which will eventually paralyze their businesses. Let UAC, with over 25 years of experience with small business accounting and marketing, help! We’ve designed a two-day workshop to teach you a proven system of marketing that will make it easy for you to get and retain clients. In just 48 hours you could be on your way to promoting your accounting firm as the most qualified around! Don’t wait too long to improve poor marketing. Time is money, and the longer you wait the more you might loose. Enroll in our next Universal Practice Builder workshop today!