bookkeeping services los angeles Archives | Page 9 of 11

Phone Instead of Your Credit Card To Buy Something? Listen-up Small Businesses?

Hold on to your small business hats, things are moving even faster. Google Inc. Chief Executive Eric Schmidt said Monday that the smart phone will eventually replace the credit card. This may come as a surprise to you, but Bill Gates predicted that and a lot more over 15 years ago in his book, The Road Ahead. This advent of technology will have a lot of challenges to small business. Some of the issues are things like, will a business have to pay any credit card fees for the transaction? Obviously there shouldn’t be one of the merchant charges, because the phone may not be using the small business merchant’s number. What about security? If someone uses a stolen phone, can they access the owner’s bank account to purchase small business merchandise? Will the small business retain the same security as a credit card transaction?

The small and medium sized businesses should be looking at these developments closely, but not just compliance issues. This type of new technology could give a small and medium sized business a competitive advantage over their rivals. How? Let’s assume that these transactions will not impact the small business as much as a credit card transaction. That translates into a savings to the small business, and maybe the consumer.

Or, what about a small business advertising that they accept I-pad credit purchases? That service can bring customers into their establishment. Small and medium sized businesses can process their purchases without high-interest charging credit cards.

Small businesses must look at as many technological advancements as possible and ask the question, “How can this technology create a marketplace where the competition becomes irrelevant?” The small businesses that jumped on the first ATM machines created an edge for a short time. Now, you don’t need them.

CPAs help Emerging Small Businesses with their Tax Strategies

A recent Los Angeles Times article discussed why emerging small businesses need to engage in tax planning. The article rarely alluded to CPA’s as the solution. Instead, the article attempted to educate the small business person with some facts that a CPA could tell them in five minutes.

As a CPA, musicians used to be that my biggest challenge. With the advent of new technology, and so many people going into business, the challenge has changed to “ma-pa businesses. Musicians, of course, have the reputation of wanting to play their music and not be bothered with the mundane business end. That is still true in my CPA practice, but at least some musicians ask questions and want to understand what is happening with their money, and why. As a CPA, I applaud this.

In regards to ma-pa businesses, they are experts at the service or product they provide to the public. They seen to focus on two things: “What are my sales?” and “Do I have enough money to make payroll?” They are too inundated to engage a CPA strategist to help them plan for the future. (Read the E-Myth for a good example).

As a CPA, another issue with ma-pa businesses, is that they may not listen to tax advice. Some business owners tend to think that a CPA is against them because we tell them that they cannot deduct personal expenses. These deductions can be very dangerous for the business owner, and CPAs since we sign the tax returns. Secondly, it is bad from a business planning strategy because the business owner can never know the true health of their business. Lastly, hiding personal expenses in a business also reduces the small business owner’s income when it comes time to qualify for a loan. There are legal ways which CPA’s reduce taxes.

CPA’s can make a huge difference in a new business if brought in early. That is why many new business owners have taken advantage of our free one hour consulting offer.

Watch Out for These 7 Traps as You Cash Flow Your Holiday Shopping

“Cash flow,” don’t “credit flow” your holiday shopping this year. But, as you walk into your favorite outlet mall, look out for the 7 Sales Pitches that are looking to take your money. The Wall Street Journal article examined the nature of these pitches and why they work on consumers.

“Shop today and save 50% next week.”

“Limit five per person.”

“Our Big Sale ends tomorrow/today/in a few hours.”

“Get 23% off.”

“We have a great deal on the accessories for that, too.”

“Save $250! (New price: $500.)”

“Get a free gift with your $50 purchase.”

So many bruise their cash flow this time of year because they lose track of their spending. It is so easy to buy something for someone and pick up something else for yourself because, well, because you deserve it , right? One good strategy is to leave the credit card home and use cash. Don’t credit flow, cash flow your holidy shopping. Start by making your list of gift recipients. Second, set a limit of what you want to spend on all gifts. For example, if you have 10 people to buy gifts for, but only $300 to spend, then you will have to limit yourself to an average of $30 a gift. Sure, you may spend $40 on one person, and $20 on another, but you get the idea. Cash flowing your holiday season will keep that unpleasant surprise appearing in your January credit card bill.

There is another danger. Using your checking account and running into your overdraft. That is just as bad as credit flowing your purchases, because you end up using a high rate credit card instead. To cash flow your holiday, go take cash (that you have in your account), out of the ATM. This is your buying fund. As you check off your gifts, you use this cash only. Don’t spend it on lunch, or gas.

Cash flowing your holidays will also help you buy smarter and not impulsively. You know that you have only so much money to spend, and you will be forced to move on to another gift selection. If you cannot buy all the gifts by this pay day because of a cash shortage, wait until the next pay day to draw out the needed cash. The item you want to buy may still be there.

Let’s say your cash flow will only allow $30 per gift, but there is a $60 item a family member really needs. Call another family member and split it. This way the gift recipient gets the gift they need, and you stay within your budget.

In these days of lay-offs, furloughs, reduced sales, we all need to shop smarter.

Business Strategy: An Over-cooked Chocolate Souffle’ tastes like a Dry Flowerless Cake

You have to admire Elton John. He could easily churn out hit pop singles that would bring him millions each year. But not anymore. According to a recent Telegraph.co.uk article Sir Elton John: I will Never Write another Pop Single , the music legend states that he can’t compete at 63 with younger artists like Lady Gaga. He is too old to write pop music.

When you read the article, you feel this is an artistic decision, but is it? Was Elton John thinking in terms of business strategy? Did he feel that his rate of return, both monetarily and artistically was starting to plumment?

If you ever cooked a chocolate souffle’, you would know that if you cook it just a couple of minutes too long, it would come out dry and hollow. The same could be said for a career and business strategy. Are you doing the same business strategy over and over and getting diminishing results? It is hard for a business person to change strategy when they have survived for so many years. So, before you lock the piano keyboard and make that call to Bernie Taupin, look at this a little deeper.

Has your business strategy gotten stale? Are you afraid to re-invent yourself and strike out a new claim in your industry? These are the questions that a good business strategy should attempt to answer.

So, how do you go about it? First, you have to take a good look at the current state of your business . Look at your business in sales, profit, market share, etc. This historical information, if done honestly, may open your eyes. Secondly, look at your industry and see if you want to be in it five years from now? If you are the last blacksmith in a town with two horses, then maybe technology has moved beyond you. In that case, you may want to change your business strategy and start designing wrought iron fences for amusement parks.

Like Elton John, a close look at your capabilities, and your industry, can release you from a diminishing drudgery and open up opportunities that can carry you for years.

Think of Your Business Clients as “Fans” and You, a Rock Star

Music Think Tank posted an article, How Well Do You Know Your Fans? that define different segments of a band’s fan base. As you read the article, substitute the word fan for business client. We all have business clients that appreciate our services on different levels. Levels of dependability, confidence, and of course honesty. Business clients can be classified in similar groups as rock fans. The questions to ask as a business owner is why are some clients more dedicated than others? What did I, as a business owner do that impressed clients to be loyal to me as some are. Lastly, once you have answered these questions, adjust your strategy in business client relationships and procurement. Learn by the mistakes when losing business clients, and duplicate the attributes you possess with those who are your greatest fans.

Are You Skating to Where the Puck is Going to Be?

“I skate to where the puck is going to be, not where it is.” –Wayne Gretsky.

This may be an overused quote, but it speaks volumes about why businesses, products, and careers strategies fail. I remember when ET hit the movies. As you well know, it was a monster hit. At the same time, I had a movie producer client who was intrigued in another script he had received because “it was just like ET.” I said to myself, “We already have an ET.” Well, the copycat movie was never made.

So much of strategy is based on copying what others have done successfully. That is not “strategy;” that is “similarity.” The link below tells the story of the imminent demise of the CD, and how companies are strategizing to squeeze every drop of life out of it before it succumbs to new technology. When you duplicate what others have done, you become a commodity. In the end, nothing will different you from others; just price. That is a red (full of sharks), not blue ocean strategy. To develop this blue ocean you must focus first on what you are delivering to your consumer, or business. Second, you must take a hard look at what consumers want, and what they are getting that they don’t want. This strategy will lead you to your blue ocean. Don’t let your strategy be swept away by copying others.

BMI article: Bye Bye CD

Strategic Planning with Cheap Technology in the Entertainment Industry

An article by Brian Stelter appeared in the New York Times about the iPad use in the entertainment industry.

Pitching Movies or Filming Shows, Hollywood is Hooked on iPads

The article demonstrates how creative types are altering their strategies by leveraging the iPad technology to display ideas of movie characters, locations, and actors. This strategy is very elastice because its limitation is the creative ability of the user. Whether it is college students carrying digital textbooks, doctors carrying patient records, or producers carrying the daily shootings, the strategy has changed. When I first started using a personal computer in the 1980’s, Lotus 123 was the big time saver. You would enter your row of numbers and click total. Nevermind that the red “WAIT” sign would flash twenty times, Lotus 123 was the greatest invention.

But there was a problem. I was constrained in developing my work strategy by Lotus 123’s functionality. All it could do was mathematical functions. But now, we are at crossroads where a disparate list of technologies have come together. The problem of limiting your strategy by the computer’s functionality has shrunk dramatically. Now, instead of the user’s strategy being limited by the equipment, the equipment is limited by the user’s strategy and abilities.

So, what does this mean to every business person and artist? It means that you should not look to technology to execute your strategy, but develop your strategy to execute the equipment’s capability. Do not do things the old way, but imagine a new way of doing things.

So, how do you start? Well, the first way is to step into the shoes of your customers. What are they looking for in a service of product? What should they be looking for, but have ignored it because nobody has offered it in such a way?

One of many theories is the Blue Ocean Strategy. Southwest Airlines sought to offer air transportation at the cost of a car rental. As history shows us, they were able to accomplish this and grab market share.

The next step is to build a strategy with milestones and metrics so you can honestly monitor your execution.

The last step is to alter your tactics in order to accomplish your goal.

Don’t Drop all 20th Century methods of Business Generation because we are in the 21st Century

This Wall Street Journal article offers examples on how business that tried social networking (SN) and search engine optimization (SEO) prospered when they combined them with old tried and true methods of generating business. SN and SEO are a great way to build a bigger fishing net, but you must throw the net out in a school of fish and personally reel it in. Good old fashioned busines sense can go a long way.

https://online.wsj.com/article/SB10001424052702303436904575570842639137342.html

You Don’t have to Be in the Music Industry to Learn from its Current Changes

I came across a good article discussing the 10 Truths about the Modern Music Business. The remarkable fact about this article was that you don’t have to be in the music industry to appreciate the observations in the article. As I read the article, I substituted “business person” for “artist,” and “customer” for “fan.” In most cases, there was a direct relationship among industries.

Now, I am not saying that every point can relate to other industries, exactly, but let me give you an example. I told a client that when I Go-ogled his industry in the southern California area, his company did not materialize. In fact, I had to insert a very refined search term, and his city, just to find his company’s site. Ironically, his competitors appeared all over my results. His response, “Well, that is not the way my business works. Companies don’t Google to find my type of business.” I asked him, “Then why are you losing market share? Why are you struggling to bring in new business, where the same competitors seem to be growing?”

This article has some good points that businesses can take home like, the use of technology to stay in front of the field, and the need to communicate directly to your target prospect, and not rely on Yellow Pages, or some other platform to do it for you. New thinking is taking hold in the world of Strategic Planning. Will you be a leader and embrace them, or be left behind with only excuses?

Music App Swims in an (Apparent) Blue Ocean Strategy Looking for a Long Tail

You remember the music industry, don’t you? You know, the enterprise sunk by pirates on dry land? But, light shines brightest in the darkness. An article came across my computer that shows the ingenuity of these creative enterprises. The article is New iPone apps are changing how music is marketed and made. This is a good example of a strategist using the Blue Ocean Strategy to create a long tail. (See Chris Anderson’s video on the Long Tail and the music industry).

In the IPhone article, the creator of the BandApp has designed an app that helps bands to launch their own virtual record companies. The app “works as a record store, marketing department and cameraphone-wielding stalker combined.” The app seems to take out the middlemen between the band and the fans. This of course is creating a blue ocean strategic plan for both the bands and the app owner because the traditional record company cannot compete on this level. The record company can advertise more, create more tours, but ultimately there will be forced to confront this app (or some derivative of it) head on. There will be no avoiding it. The app is creating a blue ocean where there is no direct competition.

Likewise, the owners of BandApp also are looking for the long tail. “Equally, rather than trying to sign five bands in hope of selling a million records each like a record company, he can, without risk, “sign” 100,000 bands, even if they’re only likely to sell 50 records each.” What that means is instead of focusing on the big-selling bands in the top tier, they are focusing on all the rest of the bands regardless of popularity. On an X-Y axis, with the Y axis representing dollars, and x axis representing band ranking, the graph would look like a big mountain with an infinitely long tail. That tail gets smaller as it stretches to the right. This is the money-making arm of BandApp.

During times of economic gloom, strategist who find their blue ocean will more likely survive now, and maybe prosper when the economy improves. The long tail combines the strategy with the new viral markets.