CategoryUncategorized Archives — Page 3 of 11 — C. Lynn Northrup, CPA, CPIM

Challenge of Online Business

The online market place is challenging and different. It is a huge space with lots of buyers and sellers. Just look at Amazon and what they are doing to brick and mortar businesses. It takes more than just throwing up a website and watching the money roll in. For me, it’s been a learning process.

Social media is a part of the selling process and offers lots of moving pieces. I have utilized Twitter, Instagram, Pinterest, Facebook, and LinkedIn. A follower or like doesn’t immediately translate to a sale.

I have an associate who has worked in B2B internet marketing for some time. He offered a tip on who has been successful in this wild world of internet business. He said check out what they are doing and copy them. That was good advice.

The key to success in selling on the internet is accumulating a mailing list where potential buyers opt-in to providing you with an email address. Your website needs to be set up with landing pages offering content in exchange for an email address. This is called a lead-nurturing campaign whereby high-value content or a free consultation is exchanged for email information.

The successful internet entrepreneurs offer both blogs and podcasts to provide quality content to potential buyers. These two vehicles typically will provide lots of helpful information and insight. Take the time to search out successful internet entrepreneurs. Read their blogs and listen to their podcasts.

The products and services offered by these entrepreneurs will likely be different from yours but the process utilized to market and sell is something that can be successfully duplicated. Take the best of what they are doing and put it to use on your website. Find out what software tools they are using and see if they would be applicable to your website.

Many of these entrepreneurs tell about their journey to success. Their website or blog posts in many cases will tell how they solved problems. Trolling information provided on websites to learn about systems, strategies, processes, and software can provide nuggets of information that will save you money and time.

The moral of this story is to duplicate success and copy best practices. What has worked for others, can work for you. Take advantage of whatever information is available and use it to your advantage.

The Challenge of Change

The challenge of change is the challenge of dealing with uncertainty. What’s going to happen if we make a change? The reality of what’s going to happen is that you don’t know until you make the change. This is part of life and living. Creating success means that you will have to bite the bullet and embrace the challenge of what can happen and then learn to deal with it.

Some thoughts on making changes is to assess the current situation and follow this 5-Step Process:

1. Understand your strengths
2. Where is improvement needed?
3. What’s working?
4. What isn’t working?
5. Create a plan to fix what’s not working

Here are some ideas on how to fix what’s not working.

Improve your effectiveness by doing the right things. After you settle on what are the right things, it is essential to focus on them and set priorities. Do what’s most important first that will make you more effective.

Once you understand where improvement is needed, you should become more efficient by doing the right things right. Review and understand the procedures for getting the right things done and the standards for how they should be done and then make the necessary improvements. This enables you to become more efficient and solve problems.

Becoming more efficient enables improvement and means you should be doing things better. Take the time to think carefully about what you’re doing and find ways to make improvements. Listen to suggestions and sort through these ideas and implement the ones having the greatest impact.

Making changes means doing away with things. This is a great opportunity to simplify and stop doing what isn’t important or doesn’t matter. This is a process of endlessly asking “why” and then following through with new ideas and concepts. Keep refocusing to continuously come up with improvements.

The fifth point of “creating a plan to fix what’s not working” is critical to successfully making changes. Spell out what’s not working and what will be eliminated together with any new steps to be implemented. These actions sound simple and easy but they will require determination and persistence to put in place. This is where focus and refocus is essential.

Master Your Destiny

Destiny is defined as the inevitable or necessary succession of events. The words inevitable or necessary don’t need to determine your future because you can control it. Most people believe that destiny is a predetermined fate. I disagree. You can control your destiny if you make a determined effort to forget the past and look to the future.

The key is to empower yourself to think positively toward the future and avoid judging yourself by the past. Embracing change is essential because you’re not going to get new results by doing the same things.

I’m working on a Mastery course so I thought a blog post dealing with the process would be a good step. Mastery ties together nicely with Creating Success. You must create a vision of who you want to be and how to make the “new you” become real. Decide on how you want to live and then don’t settle for less than you can be.

While I can’t magically convert your destiny in this short blog, I can get you started to move in the right direction. Empower yourself to focus on the problem and not the solution. Ask better questions and then keep asking. Take responsibility and then do something about. Questions provide answers. Ask what you can do and then what must I do? Think in terms of new possibilities.

Change is a big part of the answer. If something isn’t working, then make a change and with something that does. It is a process of making constant and never-ending improvement which provides the growth and change that you envision. Keep expanding your references and be willing to trust what you are focused on. Keep your vision and continue moving forward.

Your mind is your greatest asset so use it and trust it. Try to see life as it is and avoid trying to make it worse. You must dream and have the courage to follow your dreams. You need to muster the courage to move forward to fulfilling your vision. See more and judge less so that you are creating solutions and not problems.

The only way you fail is if you quit.

Coaching Case Study – Jerry

Jerry built a printing business that always had lots of sales but no profits. I was introduced to Jerry by his CPA who thought maybe I could get Jerry to listen. I came in, wandered around and asked questions. That’s what I always do. It’s amazing how much you learn when people get comfortable and share concerns, questions and ideas.

People tend to get too close to the action and never take time to step back. We began analyzing the numbers to find out the little details that can lead to big results. These steps started having Jerry’s team building trust in my suggestions. By paying attention to the little details that matter, the company achieved record sales and profits. Jerry started to believe. Having the discipline and patience to focus on the right details can produce big results. That’s what coaching gives to business owners. Once they start seeing the results, coaches become part of the team.

Once I became accepted as a member of the team greater achievement became possible. We identified that a purchasing agent was taking kickbacks. Family members got new job assignments and a succession plan was put in place. The company went from almost going out of business to becoming the most respected printer in the region.

Overcoming the initial resistance can be an obstacle but the proof is in the results and on the bottom line. I went on to implement a team building effort and a management succession plan. I’ll tell you about this effort in another post.

Plan to Do Better?

We’ve just finished up paying our taxes for the year. Maybe you had to pay more than you wanted and had to scramble to come up with enough cash for the payment. You might have looked at the numbers and wondered why we didn’t do better. There could be lots of scenarios to the story.

Reality is that many businesses don’t really know how they are doing and wonder how they can do better. This is an all too familiar theme for most small businesses. It is essential for businesses to take time to consider their options.

Here’s some signals that maybe your business could use some help:

• Gross margins have decreased.
• You can’t identify your product margins.
• Profit margins are too low.
• Your cost structure is out of line with the competition.
• You’re borrowing too much.
• You have declining trends over the past few months.

Maybe you need a tune-up:

• Has income declined over the last three quarters/
• Are sales declining?
• Are you satisfied with your overall results?
• Do you have a plan to maintain your rate of growth?

Here’s some signs that things need to turn around:

• Are you starting to lose money?
• Do you have too much inventory?
• Can you recruit new help?
• Do you have too much debt?
• Do you know where you are making profits?
  • By customer
  • By product or service
• Have you lost business to competitors?

Crisis questions might include:

• Can you meet payroll?
• Will the bank lend you more money?
• Have good employees quit?
• Have vendors stopped shipping goods to you?
• Have you had time to think and strategize?
• Have any of your customers who don’t pay on time stopped ordering?

Maybe you just think your business should be doing better and you don’t know why. Whatever the reasons, there are things every business should and could be doing to make things better. My blog post on Biggest Business Problems explains and discusses these issues.

The first thing businesses should do is step back to reflect on what you have done and where you want to go. Businesses fail to engage in “Strategic Thinking” and they fail to effectively “measure their performance” on a regular basis.

These are what I call the Management Tools for Success that are critical for growing and increasing profitability. Business owners need to spend the time and effort to learn about accounting and measurement. In addition, they need to then learn how to apply these tools to making their business more successful.

My goal is to provide business owners with the knowledge and tools they need to be successful. Take advantage of my consulting experience which are offered as resources for businesses on a subscription basis and as toolkits and checklists which can be downloaded from my store.

A good way to get started is with The Guide to Strategic Thinking and The Strategic Thinking Toolkit and creating a plan for Profit Enhancement. The key is doing something rather than just thinking about it. So go make it happen.

New Tools

New teaching and collaboration tools were added yesterday. I am now up and running with Adobe Connect so that I can work and interface with anyone anywhere. This has been in the planning ever since the conversion to the new Word Press web site began, but it is now a reality. This tool enables me to teach and share my knowledge in live webinars.

Business owners can now receive live consulting support through the meeting room capability offered by Adobe Connect. The ability to share files, of any type, combined with virtual communication in the meeting room is exciting. It represents a huge leap forward in my capability to teach, coach, and share knowledge.

My plan is to immediately begin scheduling webinar conference sessions in accounting, financial management, and basic business skills. I’ll record the initial sessions to make sure everything flows smoothly.  These sessions will be recorded and made available on the web site. Once we get past the initial stage, the webinars will be live as well as recorded.

The initial learning conference sessions will be presented over the next few weeks. There will be a total of 14 webinar learning sessions cover the three conference topics. Each session will be recorded and the recording link will be available to those who sign up to participate in the three learning programs. The three topics are:

• Accounting Basics (5 webinars)
• Basics of Business Financial Management (4 webinars)
• Basic Business Skills (5 webinars)

The sessions are described in detail by following the link to the web site.

After these initial programs, we will have an ongoing series of presentations covering a wide range of business topics. We will be providing the latest guidance on managing risk based on COSO’s new exposure draft on Enterprise Risk Management. Other topics will include strategic planning, change management, lean six sigma, and cost accounting techniques.

While specific learning topics will be offered, I will offer one on one coaching sessions on request. In addition, special webinar presentations will be offered on current topics.

The new Adobe Connect webinar and meeting capabilities offer an exciting range of possibilities that I was only able to provide through seminars and consulting engagements. Because I am so excited about the new tools, I am offering a free Accounting Basics for Business eBook to the  first 5 people who sign up for the new learning programs.

The initial presentations will be accessible by the end of next week March 10, 2017.

Business Resources

The New Business Resources offers membership access to exclusive training webinars in addition to some outstanding financial and business management reference material.

These new offerings are exciting. The Reference Guides are a new concept. Business owners can gain access to extensive financial knowledge and reference material just by subscribing for each Guide. There are three Guides offering a full range of guidance and support on managing a financial function:

• Controllership Guide
• CFO Guide
• Cost Management Guide

These Guides provide complete references and directions on implementing and operating a business financial function.

Detailed explanation of the contents of each Reference Guide is provided. The membership fee is $49.95 for a full year (12 months) of access. The material is easily accessed and available when you need reference information or an answer to a question.

The Controllership Guide addresses the accounting function, financial analysis, and internal control. The CFO Guide deals with a wider range of financial management issues such as debt and equity structure, financing, and levels of financial analysis. The Cost Management Guide provides an abundance of specialized information on cost accounting, cost management, and techniques for performing cost analysis.

Retirement Resources is a great tool for retirees and those considering retirement and is based on my work in the areas of retirement planning and elder care. It provides an abundance of information on a wide variety of retirement topics. There are also links to web sites that I researched during the course of developing multiple study programs and my Navigating Retirement book.

My new eBook Accounting Basics for Business is focused on detailing accounting basics for business owners and managers. The eBook gives them the information needed to understand and utilize accounting systems. Another eBook, Basics of Business Financial Management, addresses financial management and analysis and the use of accounting reports. Based on my experience from teaching MBAs, I created Basic Business Skills outlining the basic business skills needed to cope in today’s business environment.

The store also features toolkits and checklists to assist in managing business financial functions. Check out business tools, retirement resources, and the store. I think you’ll find the information and knowledge to help you achieve success.

Free eBook

Building Business Value© is my new eBook that will introduce you to Tools for Success and the launch of the all new www.northrupcpa.com. We’re giving you this eBook free just for signing up to receive our newsletter.

This new eBook spells out the components of business success using Strategic Optimization. This is the foundation of my Knowledge Center and the content available from the Store.  Along with this great resource, I have created several eBooks, Toolkits, and Reference Guides designed to create success and take you and your business to new heights.

Strategic Optimization is based on seven basic principles that are critical in building a successful business. Building Business Value© describes the following seven steps in detail:

1. Have a Strategy
2. Effective Sales and Marketing
3. Create Effective Processes
4. Measure Results and Progress
5. Have Visionary Leadership
6. Effective Change Leadership
7. Effectively Utilize Technology

While these steps are common sense, it’s amazing how often they get ignored. These steps represent the foundation of every consulting project which I have used to assess a multitude of companies. I think that business owners can do their own self-assessment to get them on the track of increasing the value of their businesses. I have the tools to help achieve that objective.

 The Self-assessment Toolkit is available in the Store. In addition, The Building Business Value Toolkit is also available. Combining these tools with the free eBook gives business owners a significant edge on their competition.

The New Knowledge Center is my focus for the future. Business owners and managers can gain access to Reference Guides and Training that will provide the tools needed to continue to build business value and to increase profitability.

The Building Business Value© eBook provides the foundation for effective utilization of the Tools for Success. The 10 Step Process links Strategic Optimization to the action steps required to achieve business growth:

1. Get to the point of pain experienced by the business
2. Scope out what needs to be done (corrective action)
3. Orient the business to the reality of economic and market conditions
4. Manage the scale of the business to fit current and future reality
5. Structure debt to maximize cash flow
6. Maximize assets to get the biggest bang for your buck
7. Optimize products and services
8. Improve employee effectiveness
9. Improve profitability
10. Change the right processes for the right reasons

Common sense tools and methods represent exactly what businesses need as they face tougher and increased amounts of competition. Tools for Success don’t represent silver bullet fixes, just common sense applications of what can work to make the difference between success and failure.

Businesses need to guard against complacency where they can get trapped into a state of denial and deception regarding the reality of the necessary action steps to get things on track. Conducting an effective self-assessment can be the difference between Success and Failure. The Self-Assessment Toolkit provides a solid framework of instruction on how to conduct an assessment combined with checklists and questionnaires.

Another area where businesses struggle is the development of effective strategic thinking to make the business vision and mission become reality. The Strategic Thinking and Planning Toolkit guides business owners through the process of defining their business future. You gain the tools to ask the right questions such as what business could we be in and what business should we be in? Also, there is the question as to what business shouldn’t we be in? You gain the tools to determine your unique strategic profile and to develop effective value propositions.

The New web site sets direction with Building Business Value©, the Knowledge Center, and eBooks  provide the foundation for developing action plans. With these invaluable tools, you will receive the guidance to determine what needs to take place and the specific steps or actions needed to get there. Use these tools and take your business to new heights and greater profitability!

Remember to sign up for your copy of our FREE eBook here.

The Experienced CFO

Good CFOs are hard to find. Being a CFO is more than presenting some dashboards and talking about a few financial ratios. They need specialized skills and experience to assist business owners in a variety of different ways. I understand these challenges based on over 30 years of experience as a controller and CFO.

Probably the most critical area is guiding development of strategic plans and structuring action plans to support the strategy. Another challenge is managing cash and ensuring that the business is properly financed. This means establishing an effective capital structure together with financing plans that fit objectives and business growth.

Driving business performance and the ability to use the tools required to support growth are also essential. These skills include understanding sales, marketing and the underlying cost structure to support growth. Business analysis, performance measurement and cost accounting are just a few additional skills that are essential.

Prioritizing capital investments and helping guide business owners to make the right decisions on the right projects is another area where CFOs can help business owners. Risk management is a key factor in allocating capital and applying enterprise risk management steps is essential to success.

Other high priority areas include buying and selling companies and succession planning. I can help you in these areas based on my experience with a top consulting firm who specializes in these areas. I can help you gain a competitive advantage in today’s complicated business world.

Good CFOs are hard to find. Most talented CFOs are already employed by larger companies. Small business owners should look for talented advisors capable of using cloud technology and tools allowing easier access to this hard to find skill set. It also reduces the cost of services provided. I am certified in the use of cloud accounting systems and am available to help in these areas and wrote the book on profit focused accounting.

Not all CPAs using cloud accounting and cloud technology have the training and experience to offer CFO support. These CPAs should consider collaborating with an experienced CFO advisor to work with their clients to create win/win situations.

Utilizing a skilled CFO will give businesses a competitive advantage. Business owners can’t know everything and it makes sense to access skilled experience advisors to fill in the gaps. If you are looking for a virtual CPA with extensive CFO experience or need help in this area please contact me.

Cloud Accounting – It’s Safe and Secure

Cloud accounting is as safe as internet banking which we have been doing for over fifteen years. When utilizing cloud accounting it is important to realize that you have control over who has access to your system and what they are authorized to do. It is essential to know that no one including the support staff of the software company can access your data unless you authorize it.

Standard access to your system is done through a login and a password. Some vendors such as Xero and QuickBooks Online offer the option of a two-step authentication which provides a second level of security. This reduces the risk of your account being accessed if your password is compromised. Small businesses typically don’t do a good job with security so this step helps them do a better job to ensure the security of their system.

All data entered into your cloud accounting system is encrypted using industry-standard TLS (Transport Layer Security). The data is also encrypted when it is stored on the host servers and when it is transferred between data centers.

Online accounting software vendors do an excellent job of protecting their systems and networks. They utilize multiple layers of security to protect your data including firewalls, intrusion protection systems and network segregation. In addition, they utilize industry leading security vendors to help them protect their systems against intrusion from global intelligence threats.

Software vendors are located within enterprise-grading hosting facilities that employ robust physical security controls to prevent physical access to the servers. Controls include 24/7/365 monitoring and surveillance combined with on-site security staff and regularly scheduled ongoing security audits. In addition, multiple geographic and separated data replicas and hosting environments are maintained to minimize the risk of data loss or outages.

Xero, for example, performs real-time data replication between geographically diverse and protected facilities. This is done to ensure that data is available and stored safely. So even if an entire hosting facility failed, they can quickly switch to a backup to keep Xero and your business running.

The true risk with cloud accounting systems is the people using the systems and their failure to utilize proper care when working on the internet. Scammers will try to trick people to obtain user names, passwords, credit card details, and bank account numbers. Some of the tricks that they try to get you to:

• Clicking on a link that might infect your computer with malicious software.
• Following a link to a fake, but convincing website that will steal your login details.
• Opening an attachment that will infect your computer.

The key is to be aware of these traps to steal your sensitive information and be careful not to fall for these gimmicks.

Some things to watch for that will help you avoid problems include watching out for the following indications:

• Incorrect spelling or grammar.
• The actual linked URL is different from what is displayed (hover your mouse over any links in the email to see if there are any differences.
• Emails that call for urgent action.
• Emails indicating that you have a parcel waiting that you didn’t order or promises for rewarding you for helping out.
• Changes to how information is usually presented.
• If you receive a suspicious email do not click on any link or attachment contained in the email.
• Do not reply to any suspicious emails and delete them.

You need to understand that while there are potential hazards out there on the internet, cloud accounting systems are as secure as on line banking. The biggest security risks lie with the carelessness of people using the system.

Cloud based accounting systems offer significant advantages to help you grow your business. They represent accounting systems of the future that you can use today because their unique capability and enhancements such as dashboard and performance measurement tools. They also facilitate utilization of virtual financial experts to assist you in managing your business.

Cloud accounting systems allows businesses to take advantage of cost effective virtual advisors and cloud technology tools to accelerate growth and increase profitability. There’s lot’s to gain from cloud based accounting and with minimal risk.