Getting it Right: Quick Tips On Getting A Small Business Off To A Good Start

Over the last 20 or so years, I’ve been an employee of a small business, the owner of a small business or had numerous small businesses as clients of my small business. During that time, I’ve been privileged to get first hand experience in what they’ve done right and what they’ve done wrong.

Yes, this subject has been written about before, probably many times over. But guess what? I’m still seeing the same mistakes, so I think it’s worth revisiting every now and again.

I think the most important thing to consider in getting it right and succeeding is to work with a consultant – small businesses are more likely to succeed when they work with a professional. My suggestion is an accounting professional that has the technological savvy to seek out solutions for your business. Another option would be a local Small Business Development Center – they have many free or low cost resources.

Here are a couple of the most common missteps I see, and some suggestions on how to avoid them.

Bookkeeping is an afterthought

I recently worked with a business coach that suggested I use a cold call approach to LinkedIn connections about doing their bookkeeping. I tried to explain to her that for many small business owners, this was akin to an addict being told they had a problem, and would not work at all.

As a rule, entrepreneurs are a rather stubborn bunch (which is another article all on it’s own!), and feel the need to just handle this aspect of their business themselves. You can tell them over and over and over that what they’re doing isn’t in their best interest, but some just need to get to that place on their own.

Sometimes, when I’m talking to an owner that seems on the fence about hiring a bookkeeping service or in house bookkeeper, I’ll ask them: “Would you represent yourself in court? Do your own surgery? Cut your own hair or try to do dry clean your suits yourself? Then why are you trying to do this?” This generally stops them dead in their tracks and by the time I ask them if they started their business so they could do a bank reconciliation every month they finally get it.

Another similar mistake, is that they have someone completely not qualified to do the books in charge of it. I physically cringe when I read a help wanted ad for someone looking to hire: “Receptionist needed. QuickBooks a plus”. Really? Really?? You’re going to have one of the most important aspects of your business, what I refer to as the backbone of every business – the basic accounting and day to day bookkeeping – done by someone as a secondary skill to what you actually hired them to do?

Solution:

Outsource as much of this as you are able to logistically, or can afford. Scale up as you grow, or hire someone full time if the situation calls for it. For instance, one client of ours started with having us manage her bank feeds in QuickBooks Online and reconcile her bank, credit card and merchant accounts.

As she grew, she asked us to take on payroll, then accounts payable and much of accounts receivables. Eventually, she outgrew our services and I had to tell her she was at the point that she needed a full time, in house bookkeeper.

Rather than being upset about the loss of a great client, I felt like a mother bird whose baby had just learned to fly. I was so proud to have been able to watch her business grow, and felt fortunate to have been a part of it. Last time I checked in, the bookkeeper had become company controller, managing a staff of 3 part time employees.

Growing pains

These small businesses open their doors and just sort of… start working (like I did!) This is one that so common, and the one that causes so much hair pulling and gnashing of teeth later, when the company starts to grow.

I see so many small businesses that originally come to me in the first year or two of being open because they’ve realized that they can’t do their books any more. When I start asking about their workflow, the sales cycle, project management, anything related to their back office setup – many times they tell me they’re not really sure or there are multiple ways things are getting accomplished.

Often they’re using multiple applications to track different aspects of their business – one for sales leads, one for accounting, one for projects, one for inventory. I liken this to a neighborhood tree house that gets built with whatever extra lumber happens to be laying around, and gets added on to as each new round of kids inherits it from their older siblings, and is sort of falling apart.

Many times the processes in place are a result of the software and hardware they have (often inherited, like that janky treehouse, from those that came before them) in place, rather than determining the most efficient way, then finding the best tool(s) to get it done efficiently. Management hasn’t documented anything, and employees are trying to just keep up with all the different tools in place, don’t have the experience, or don’t feel empowered to attempt to make the changes.

Suggestion:

Define your workflow. If you’re an existing business, take the time to map out existing processes, identify pain points and then seek out solutions to solve them. For new businesses, think about out how you would like your processes to flow – and look for solutions that will allow for that, or as close as possible.

We just finished a consultation for a business coaching firm that was using various methods to track leads, close deals, manage finances and monitor projects. They wanted an integrated solution with as few moving parts as possible, so we suggested WORK[etc] for their CRM/Project Management, synced with QuickBooks Online and G Suite.

A few last bits I’d like to share

I think one of the most important aspects of running a small business – is constantly evaluate your systems and make adjustments when needed. Ask your employees, your clients, customers and vendors, for input on the process. What’s working? What isn’t? What are their suggestions for making improvements?

The other is the reminder that most of the successes that I’ve seen have been due in large part by the principals of a small business recognizing the need to work with some sort of accounting professional or business counselor. You can’t run a business in vacuum, so get help. Set aside budget for a consultant, or seek out other resources such as the local SBDC. However you do it, why not tip the scales in favor of your success?

What stumbling blocks have you experienced? Share those and any questions in the comments. Stacy does her best to reply to everyone!

Please contact Stacy and her staff at Kildal Services LLC to see how they can help you integrate QuickBooks Online and create a cohesive business management system.  Free phone consultations and low cost process reviews are available, and as cheesy as it sounds – helping small businesses really is their passion.