Good article on getting work done - 7 steps to Better Personal Productivity

Good article on getting work done – 7 steps to Better Personal Productivity

These ideas for getting more done make a lot of sense to me, I think I’ll keep them handy so I can stay on track for the big projects. I’ve done #3 successfully and I’ve victimized myself on #6.

Read the article here.

When I first got into the workforce I had a boss tell me, the distance between good and great is not as far as we like to use for an excuse. I’ve always tried to remember that.

A New Year’s resolution list for small business owners……

In the spirit of the holidays I’ve decided to give small business owners a ready made, no assembly required, New Year’s resolution list. It’s only 5 items and it’s designed for every business owner.

Here’s your list………… yes that means you!

  1. Smile more – business life is never as bad as it seems when things aren’t going well. From a business perspective there is always a way out…always.
  2. Read more – I don’t care how long you’ve been in business nor how smart you think you are…you can learn something from someone else. I suggest that you read things that are not directly related to your industry. Skimming your trade journal every month to see who got fired is not real reading.
  3. Plan more – Set aside specific blocks of time, away from the office, where your only job is to think about your business 6 -12 months in the future. In spite of what you may believe, planning is not the same as updating a to do list.  
  4. Say thank you more – to your spouse, your parents, your kids (yep, I said kids), to your customers, to your employees, to your vendors, etc. You get the idea, right?
  5. Wish less, Do more – I recently read (see #2 above) that the best productivity tool in the world is to do something. Makes sense to me, we can talk about doing something or we can actually do something. If we’re talking about doing something it’s still on the to do list, if we actually do it…by golly the list is shorter.
There’s your ready made, easy to use list. And by the way it’s my list also for 2011. And… thank you for reading this blog, I’ll try to make it better than ever in the new year.
If you don’t use this list I’d love to see your list! 
Happy New Year!!!

Are you a business owner that wants to grow? Part 1

This is Part 1 of what will be several posts about growing your business. I’ll cover some free ways to grow and I’ll also talk about growth opportunities that aren’t free.

I meet many business owners who want to grow but very few know how to grow.  Let’s look some common ways to grow your business.

Low cost/no cost growth.

Train your people better so they get the most sales out of every customer encounter. 

        Example – How many times would you have ordered dessert in a restaurant if someone would just ask? At a restaurant that is missing opportunity, the server sees that I am finished with my dinner and the server walks up and asks “Would you like anything else?” My response, “No thanks.”

At a different restaurant, the server sees I’ve completed my meal and asks “how would you like a slice of blueberry pie or a hot fudge sundae?”  I don’t know about you but for me it’s a lot easier to say no to the first server than the second one.

What’s it mean to the business owner? If a dessert costs $5 and the restaurant serves 100 people per night, getting just 4 more people out of 100 people per night to order dessert means $7,300 per year in additional sales and the cost on that sale is the lowest you can have. All the help is already paid, rent doesn’t go up, light bill is the same, etc. So the owner of that business could make $7,300 more per year because his servers just asked the same question a different way. That’s as close to free money as a business owner can get.

Every business has these kinds of opportunities regardless of the industry. Take a close, a very close, look at your business and you will find opportunities to increase sales to your existing customers. Often the secret to good selling is knowing how to ask good questions. Are your people asking the good questions?

New 1099 Rules effect on Small Business

    This post provided by Paul Ikard, CPA

March 17, 2012  – Some of the below rules may have been modified, check with your CPA before taking any action.

Businesses and not-for-profit organizations are accustomed to IRS rules that require them to report certain payments on annual Form 1099 information returns. However, the recently enacted healthcare law imposes surprising new Form 1099 reporting requirements. Complying with them may add significantly to your organization’s paperwork burden. While the new rules don’t apply to payments made before 2012, it’s not too early to start gearing up to deal with them.

Current Rules in a Nutshell

Background: For many years, businesses have been required to report various payments on different versions of Form 1099. For instance, when a business pays $600 or more during a calendar year to an independent contractor for services, the business must issue the contractor a Form 1099-MISC that reports the amount paid that year. The business must also furnish a copy of the Form 1099-MISC to the IRS. This reporting procedure helps contractors remember to include the payments on their tax returns, and it helps the IRS ensure that income is reported. Under rules now in effect, other types of payments that businesses must report on Forms 1099
1. Commissions, fees, and other compensation paid to a single recipient when the total
amount paid in a calendar year is $600 or more.
2. Interest, rents, royalties, annuities, and income items paid to a single recipient when
the total amount paid in a calendar year is $600 or more.
When a Form 1099 is required, it must show:
The total amount for the calendar year;
The name and address of the payee;
The tax ID number (TIN) of the payee (For privacy reasons, it’s okay to show a truncated
TIN on a 1099 issued to an individual);

Contact information for the payer; and

The payer’s TIN.

If your business doesn’t have a payee’s TIN, you may be required to institute backup federal income tax withholding at a 28 percent rate on payments under Internal Revenue Code Section 3406. In most cases, the rules summarized above apply to payments made by not-for-profit organizations since they are generally considered to be businesses for Form 1099 reporting purposes. If a payer inadvertently fails to issue a proper Form 1099, the IRS can assess a $50 penalty. The penalty for each intentional failure can be $100 or more.

Reporting Payments to Corporations

Under the rules that currently apply, most payments to corporations are exempt from Form 1099 reporting requirements. However, there are a few exceptions. For instance, payments of $600 or more in a calendar year to an incorporated law firm must be reported on Form 1099-MISC.

Example:  our business makes $30,000 in monthly payments to rent office space from a corporate lessor. Under the current rules that apply today, there is no 1099 reporting requirement for the payments, because they are made to a corporation.

Reporting Payments for Property

Under current rules, there is also generally no requirement to issue 1099s to report payments for property (such as merchandise, raw materials and equipment).

Example: Your business buys a delivery van, display shelving, and computer equipment. Under today’s rules, there’s no 1099 reporting requirement for these purchases.

What Will Change in 2012 and Beyond?

The healthcare legislation makes two big changes to the existing Form 1099 reporting rules and a third change that is hard to assess without further guidance from the IRS.

First Change: Payments to Corporations Must Be Reported. Starting in 2012, if your business pays a corporation $600 or more in a calendar year, you must report the total amount on an information return. Presumably, Form 1099-MISC will be used for this purpose, or the IRS will develop a new form. (Payments to corporations that are tax-exempt organizations will be exempt from this new requirement.)

In 2012, your business pays $30,000 to rent office space from a corporate lessor. Under the new rules that take effect in 2012, the $30,000 must be reported on a Form 1099. Your business pays $2,000 for four employees to attend a seminar in 2012 put on by a corporation. Under the new rules that go into effect that year, the $2,000 must be reported on a Form 1099. Several employees go on a business trip in 2012, and your business pays $1,500 to a corporate hotel. The $1,500 must be reported on a Form 1099 for that year.
In 2012, your business spends $1,000 at a local restaurant for an employee holiday dinner. The restaurant is operated by a corporation. Under the rules scheduled to become effective that year, the $1,000 must be reported on a Form 1099.

Second Change: Payments for Property Must Be Reported. Starting in 2012, if your business pays $600 or more in a calendar year to any party (including an individual) as “amounts in consideration for property,” you must report the total payments on an information return for that year. The term “property” means computer equipment, office supplies, raw materials, and just about anything else you can put your hands on. Again, Form 1099-MISC might be used to reported affected payments, or a new IRS form might be created.

In 2012, your business buys cash registers from a supplier for $25,000. It also spends $1,000 at a food and beverage store to buy refreshments for a company party. Later that year, the company pays an individual $1,500 for an old pickup truck and spends $750 at an office supply store for copier ink and computer paper. Under the new rules that are scheduled to go into effect in 2012, all these transactions will require your business to issue 1099s. As you can see, the new requirements to report corporate payments and amounts to buy property will undoubtedly result in the issuance of many millions of additional Forms 1099 each year.
(Presumably, payments between related corporations will not be exempt.)

Another Burden. 

Your business must also obtain a TIN from each affected payee to avoid the requirement for backup withholding of federal income tax. On the other side of the coin, if your business sells property or you operate a corporate business, you will have to supply customers with your TIN to avoid backup withholding on payments made to you.

Third Change: Payments of “Gross Proceeds” Must Be Reported. Here’s where the new upcoming rules get more confusing. Under a third new rule that will take effect in 2012, payments of $600 or more in “gross proceeds” to a payee in a calendar year must be reported on an information return. At this point, it is unclear what this new reporting requirement is meant to cover. The best guess is that it is meant to cover payments add to non-corporate payees, such as restaurants and other small businesses. We are awaiting IRS clarification on this issue.

Action Plan

Dealing with the new Form 1099 reporting rules is going to be difficult for many organizations — resulting in an avalanche of paperwork. Your business will likely have to modify its accounting procedures to capture payee information that will be needed to comply with the new requirements.

Remember: TINs must be obtained from your vendors to avoid having to institute backup federal income tax withholding on payments made to them. By the same token, your business must ensure that your customers have your TIN to avoid backup withholding on payments made to you. What if backup withholding does occur on payments made to you? You must be prepared to track the withheld amounts so you can claim edit for them at tax return time. If your business winds up on either side of the backup withholding rules, it can be a real mess. And with lots more 1099s flying around, the odds of errors rise proportionately. To compound the problems with the new reporting requirements, many businesses use accounting methods other than the cash basis. In addition, a number of businesses file their returns using reporting periods other than calendar years. In an audit, imagine your business and the IRS attempting to reconcile 1099s with these complications.
Fortunately, the new Form 1099 reporting rules (including any backup withholding implications) don’t cover payments made before 2012.

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Document My Systems?…..Which Systems?

Recently I wrote a post about how businesses should document their systems to improve their profits and value.

I received some feedback that went something like this..

“Which systems, there are a million systems in my business!”

Well, you’re correct. Even a small business has many different systems. How you answer the phone, how to install the widget, how to log into your QuickBooks, it goes on and on.

So where should you start?

My advice is to make your first written/documented system the one that is most critical to the success of your business. That means you can rule out how to log on to your computer, how to check voice mail, how to refill the paper in the copier.

Here are some examples of critical systems for various businesses:

  • If you have a staffing firm you need a great system for interviewing potential hires.
  • If you  have an auto repair shop you need a great system for diagnosing car problems.
  • If you own an ice cream store you need a system to make sure the ice cream temperature is always perfect.

What’s the most critical system for your business? You’ll need to decide, then write it down, diagram it, draw it… do whatever you need to do to make sure that someone can do it if you’re on a sail boat in the middle of the ocean.

If it’s in your head it’s only useful to you, if it’s documented it’s valuable.

Email as Productivity Tool

We have been using gmail enterprise email system for about 6 months and I have to tell you it is a great system. Like most of what Google is known for, biz gmail is intuitive yet robust enough to handle a relatively heavy email user (I get about 150 emails a day). If you are looking for any easy to launch, low cost and full featured email system I think you’ll find gmail for biz a good choice. Here’s a place to start google biz email.

We have about 17 users on the system and although the email works great the google docs system has a way to go. We still have trouble with document conversions and I can’t recommend google docs for any serious document management uses.
If you decide to try it let me know what you think.