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Whats your brand say about you and your company

 


It takes 20 years to build a reputation and only five minutes to ruin it.
If you think about that, you'll do things differently.  
~Warren Buffett~

In business we spend a lifetime building our brand. A brand is really all about how people regard your products and services and how you go about delivering them.

As a small business owner how are you going about protecting the reputation of your business?
Protecting your reputation is more than just managing your advertising. 
I
n small business we are usually very dependent on the local community and therefore 
every interaction  and touch point with a customer or potential customer is a "moment of truth". 

Make sure your team are critically aware of these moments of truth and ensure we not only maintain
our reputation  but always seek to enhance it through outstanding customer service. 

By ensuring that every touch point is a positive experience for prospects and customers is vital
to ensuring that your business continues to grow.

For all Business and Tax advice call Ross Wadeson Accountants on (03) 9580 9866



Opportunities are all around us... action is the key

                                                                                                                                  

    A pessimist sees the difficulty in every opportunity; 

an optimist sees the opportunity in every difficulty

......Winston Churchill


    






Ever heard the definition of luck? It is when "preparedness meets 

opportunity" Guess what? Opportunities are always around us. 

 

A major difference between really successful businesses and 

unsuccessful businesses is that the leader or business owner and/or

the team is prepared to make decisions and take actions.

It is very easy to be distracted by news of doom and gloom.

 

In challenging times that well Lead businesses for become strong and

really reap the big rewards when the market cycle actually changes 

(which is always does.) The secret is test & measure strategies and do

more and more of those that actually work when proactively implemented.

   

It is in challenging times that well lead businesses to become strong and

really reap the big rewards when the market actually cycle changes 

(which it always does). The secret is to test & measure strategies and do

more and more of those that actually work when proactively implemented. 

 

This principle also applies to looking at your current business structures

and processes to ensure that you are protected in the in case of an unexpected

event or business downturn. 

 

We have seen a number of business owners come to see us when something has

gone wrong in their business.Unfortunately by the time they come to see us it is

sometimes to late. They didn't have the adequate protection or structures or

processes in place to navigate the unexpected, often with costly repercussions.

 

The lessons we can learn from other's mistakes, is to obtain good advice from

experienced advisers, setup properly, review the setup from time to time as as

circumstances change.  If there is a looming problem,don't put your head in the

sand: get some sound help as early as you possible can. 

 

If you would like to discuss growth strategies and or business structures to 

protect your business please don't not hesitate to call Ross Wadeson Accountants

for a confidential chat about your business goals. 

 

Call Ross Wadeson Accountants on 03 9580 9866

 

 

 

 

Business Owners and Contractors - Be Aware

                                                                                                                                                        

       The Government is focusing on employers and sham contractors.

       In the budget for 2019-2020, $9.2 Million will be provided over 

      4 years to establish a dedicated sham contracting unit within the 

       Fair Work Ombudsman's jurisdiction.

 

       This unit is investigating sham contracting behaviour by those who

       knowingly or recklessly misrepresent employment relationships as 

       independent contractors to avoid statutory obligation and 

       employment entitlements.

 

       The unit will address sham contracting by increasing education, 

       compliance and enforcement activities, dedicating additional 

       resources to not only investigate, but also to take cases to Court.

 

       The establishment of this unit is a further indication of the 

       Government's desire to arrest sham contractors to ensure employers 

       meet their legal and taxation obligations.

 

       Employers, if the 'Contractor' derives most of their income from one 

       source, you will be a target.

       Contractors, there are multiple rules to consider but even if you can
       establish as a Contractor, even as a Company, you are still likely caught by
       the ATO Personal Services income rules.
 
       If you have any doubts, make an appointment to discuss your personal
       circumstances with us.

       Call Ross Wadeson Accountants on 03 5980 9866

 

 

The best return on investment for business owners

  "How many millionaires do you know who have 

   become wealthy by investing in savings accounts? 

  I rest my case."

........Robert G Allen 

(Author of Creating Wealth)


Interesting question! Most self-made millionaires have become so via the ownership of a business.

Generally, well run businesses have the greatest return on investment of all the investment types. Let's think about it. The sale price for most businesses is derived as a multiple of the businesses net or bottom line profit. A typical business where the owner has day to day involvement in the running of the business attracts perhaps 2 or 3 times multiple of the bottom line profit.

"Generally, well run businesses have the greatest return on investment of all the investment types

Therefore, if the business had a bottom-line profit of say $100K, then the business could sell for say $200K or $300K. So the purchaser pays the owner $200K for the purchase of the business and expects to have their capital returned over 2 years which is a 50% return on investment. Try getting that return from bank or mutual fund. If it was $300K then there is a 33% return on investment.

 Now imagine that the business runs under management. It would now be more likely to attract a 5 time multiple or $500K. The return on investment is now reduced to 20% (still far greater than the bank or mutual fund returns).

"It would now be more likely to attract a 5-time multiple or $500K"

Why the difference you might ask? It is because there is less risk involved. In the first example the business owner was critically involved in the day to day running (in the business) and therefore when the business is sold and the owner moves on to other things, there is risk that the profits might reduce due to the original business owner not being involved any more.

In the second example the business owner is no longer involved in the day to day running of the business and therefore the confidence of the purchaser in continuing to receive the $100K bottom line profit is enhanced as the business can continue as normal and therefore the purchaser perceives less risk. Accordingly, they are prepared to accept a lower return on investment.

Isn't is worth working on a strategy to remove yourself from the day to running of the business?  Planning for when you sell the business is critical.  It's never too early to start.

Talk to Ross Wadeson Accountants about your business, tax and financial needs.

Call us on 9580 9866 for a confidential discussion.

8 steps to creating a successful exit strategy

There is a lot of talk at our office these days about exit and succession planning as many
of our clients
and our local business owner community are looking down the barrel of retirement and are unsure if they have their business prepared to maximise the sale or indeed even positioned for more than just a fire sale!  The sad fact that most business owners don't and will end up liquidating their business when the time comes to move on.

" Only small percentage of businesses are saleable" 

Many owners fail to develop an exit plan for their small business, which is a huge mistake. You should develop an exit plan for your business right from the very beginning.

Having an exit plan in place will help you keep the business going in the right direction by constantly aligning with your long-term goals. Did you know that only  that only a small percentage of businesses are saleable?

One thing is for certain: Your exit plan will change over time, so make sure to review it often. I suggest writing your exit plan down and then reading it every six months or so; as it changes, make updates to it.

"You should develop an exit plan for your business right from the very beginning."

Below are 8 steps to prepare your small business for an exit.

1. Finding Buyers

One thing businesses fail to think about is finding buyers for their business. Most owners just assume someone will want to buy their business, which is a huge mistake. According to exits.com, " Only 25% of saleable companies exist."

Keeping a list of potential buyers is a critical piece of your exit plan. Prospective buyers can be individuals or businesses who have approached you in the past about acquiring your business. You should also keep a list of competitors who may be interested in acquiring you when the time is right.

Sourcing potential buyers of your business and keeping a list of them will come in handy when the time comes to exit.

2. Reoccurring Revenue

Revenue is an important piece of your business exit; not only how much you have of it, but also the form in which it comes into your bank. Subscription-based products and services that produce reoccurring, predictable revenue are attractive to potential buyers.

Another smart thing to do with your revenue if possible is to bill automatically, in advance. If all of your revenue is set up as reoccurring payments on the 1st of each month for that month's service, you will have a very attractive business to acquire.

A business with reoccurring, predictable revenue that is billed automatically and in advance is very attractive to a buyer.

3. A Good Growth Pattern

Obviously, having a business that has shown good growth patterns is what you are aiming for and what purchases will want to see. Steady and predictable financial growth is the goal.

You may have some dips in your growth patterns here and there, but as long as they can be explained with an acceptable answer, you will probably be OK. What a buyer does not want to see is erratic swings in your growth.

Solid, predictable growth is attractive to a buyer.

4. Standard Operating Procedures

If you don't have a set of detailed standard operating procedures that are written down, you need to develop them right away. Build your business to the point where, if you get hit by a bus and are killed, your business will move forward without any disruption.

You really want to detail everything in your standard procedures, including but not limited to:

• Executive strategy, vision, mission, core values, and management practices.
• Marketing plan-The strategy and tools used to attract prospects to your company.
• Sales plan and procedures-What tools and processes the business uses to convert prospects to customers.
• Operating procedures-Detailed processes of how the business works day in and day out to deliver to customers.

Think about it: If you are looking at two companies to acquire with similar revenues and other characteristics but one has a written set of standard operating procedures and the other does not, which one will you purchase?

5. Something Proprietary

Buyers love to invest in or acquire a business that has something proprietary. That doesn't necessarily mean you have to have a patent on something (although that is huge).

You could just have a certain process that is unique. In his brilliant book Built to Sell, John Warrillow explains, "You should name and own your process."

If you have anything that is exclusive to your business, make sure to highlight it as it will be a big selling point.

6. Good Bookkeeping

Many small business owners struggle with accounting and bookkeeping. Don't do what you don't know. Engage a good bookkeeper and accountant is critical.

If you are going to exit, you will need a good set of books that have been audited regularly; using an outsourced bookkeeping and accounting service is recommended.

7. An Owner Who Is Removed

This may sound crazy, but if you are going to exit, you need to remove yourself from the business. If the business is only doing well because of you, then you will significantly decrease the value of your business.

If you, the owner, are vital to the success of the business, nobody will want to buy you or they will lock you into a long earn-out and make you stay involved for a predetermined amount of time.

8. A Solid Long-term Management Team

While a potential acquirer may want to get an owner out of the business, they will want to see a management team who is committed to the future. If it appears that most key employees have the option to leave after the sale of the business, then this will be a big negative to a buyer.

Put good employee contracts in place with your key management team. Rather than giving them equity in the business, give them a bonus in the event of the business being sold and terms that allow the bonus to be paid out over a year or two.

If you are planning to exit your business at some point in the future, don't just assume that someone will want to buy your business. Increase your chances of success by following the above steps and reviewing your exit plan on regular basis.

If you need help with planning an exit strategy give us a call for a complementary discussion.

Regards

Ross Wadeson

Taking time out can help grow your business

     The challenge for business owners is to know when it's time to take a break and
     spend time with the family, catch up with friends,have a game of golf etc.

     Christmas time is often a time when the business owner is forced to close the
     business and take a well deserved rest.  

     It gives them time to spend with loved ones and have some rest and relaxation.
     It is also a good time too quietly reflect on recent business results without any
     day to day distractions.  

     The challenge here it to not stress out or feel discouraged if things didn't quite work
     out to plan and you did not achieve what you set out to over the past 12 months.

Is failure always a bad thing? What if you viewed it as a learning experience? Failure is usually only temporary unless you do not learn from it.

What really is failure? Could it be a learning experience that helps you achieve success?

"Without failure you never really achieve any innovation and/or long-lasting change?"

What if you never experienced any level of failure? Is it possible that without failure you never really achieve any innovation and/or long-lasting change? Remember the legend Thomas Edison? He failed 10,000 times prior to his amazing success in inventing the light bulb. What if Edison had had given up after the first 10, 20 or even 100 times?

Often failure is just the elimination of the options that did not work. Focus on eliminating the options that do not work and accelerate your achievement of success.

" Failure is just the elimination of the options that did not work"

So, keep dreaming and coming up with new ideas for the coming 12 months.  How else will your business grow.

If you need to grow your business or review your financial processes and structures give us a Call

Ross Wadeson Accountants 03 9580 9866

 

The Truth About Surviving a Tax Audit

 

     Yet another Small Business Audit by the Australian Tax Office (ATO).

     Yet another successful outcome for our Client.


     However, it still disrupted their daily business routine,
required going through
     boxes of receipts and information,
several discussions and reviews with us and
     meetings with the ATO
Successful in that the ATO decided there was nothing
     wrong or requiring further investigation.

 


"Firstly, consider the merits of Tax Audit Insurance"

This went well for the Client and confirmed their records can stand the test, although there was still a cost in time and anxiety.  Fortunately, they also had Audit Insurance so our fees were not a cost to them.

An audit is never easy, but having the appropriate systems in place, keeping things organised and communicating well with us (your accountants) can help you through the process with a bit more confidence.

"The ATO start audits based on a range of different triggers"

The ATO start audits based on a range of different triggers.  One of the most common is the Business Owner was 'dobbed in' by a disgruntled, usually ex-partner (business or personal); also, possibly disgruntled employees, neighbours and the like.  Another growing and common trigger is that your financials have, rightly or wrongly, statistically deviated from the norm for your industry.  The ATO computers are now getting more and more accurate in predicting what sort of Income you should have declared!

 So – what should you do to minimise the impact:

1.  Firstly, consider the merits of Tax Audit Insurance; more relevant to some.

2. Secondly, see that the bookkeeping and accounting records are kept up to date and are accurate, including whether you:

·         are declaring all the income you received

·         Are entitled to deductions, credits or tax offsets you claim

·         Correctly withheld and reported PAYG(W) amounts


3. Correctly calculated and reported other tax-related obligations

You can minimise your worry about a tax audit if you follow a few simple tips beforehand:

 

Keep accurate, up-to-date records

Poor record keeping is a common problem amongst  small business owners. It's a good idea to get your hands on some simple bookkeeping software to take care of your records. The program should be up to date with all tax regulations to ensure your compliance.  All you need to do is enter your information regularly.  It is helpful to speak with your accountant often. Keep in mind that you are responsible for any mistakes or omissions, so it really does pay to be up to date.

 

Always double check before signing your tax return

Always look over your figures again, to ensure there are no discrepancies before you send them off.  Look to see they make sense to you as nobody knows your business like you do.

 

Keep documents for at least 5 years

Most audits are conducted on the previous year's tax return, but auditors can go back to previous tax returns if they believe you have largely understated your taxable income.  By keeping all your documentation from the last five years you are able to back up any claims you have made.  If you have a scanner, you may choose to scan them.

 

If you notice an error correct it straight away

If you realise there is a mistake, come clean about it and talk to your accountants (us) about it. If you do state you have made errors at the start of the audit, the ATO will reduce any penalties you may incur.

 

What to do if you are audited

If you have received word that you are going to be audited here are a few hints that will help you through the process:

1.  If you are going to be audited you will receive a letter from the ATO outlining the scope of the audit. Don't do anything until you have spoken with us as your Accountants.

2.  We will be able to explain clearly what the ATO is asking for and what they want to look at.

3.  Specify one person only to be the contact point with the ATO. This should probably be your accountant.

4.  Take notes at every meeting.  Obtain a copy of any ATO recording if one is made.

5.  Watch what you say.  Be courteous and respectful when you are dealing with auditors.  It's also best to limit what you say instead of engaging in too much idle chit chat.

 

The computer systems the ATO have been investing in can reveal irregularities and unusual transactions very easily. The ATO is trying to make the message clear – if you are not paying the right amount of tax, there is a high probability you are going to be caught.

 

If you have any questions; talk to Ross Wadeson Accountants  - 03 9580 9866


 

Marketing in the past 5 to 10 years has changed dramatically.  

In the good old days, we put an advertisement in the paper 

or journal and waited for the phone to start ringing.  

I recently read an interesting paper base on results of Lead Response Management research conducted by James Oldroyd, PHD, Ohio State
University & Dave Eltkington, CEO insidesales.com.  

It confirmed my belief, that businesses still need to incorporate good old-fashioned lead generation (telephoning prospects) with modern marketing activities. If you want to grow your business, you still need to pick up the
phone and personally engage with your prospects.  We have been doing just
that at RWA for the past 2 years.  

" For a baby boomer like myself it all seemed to hard"

Nowadays it's all about your digital profile, marketing via email campaigns, social media. Linkedin, Instagram, Facebook, SEO, Twitter and Ad Words.

It has been a challenge for many of us to get our heads around the new marketing applications. For a baby boomer like myself it all seemed too hard until a young undergraduate came on board to teach me the ropes. 

I now combine the new technologies with good old-fashioned lead generation to improve conversion from a lead into a sale. Picking up the phone and having a conversation with prospects is a proven key to closing more sales.

How Much Time Before Web- Generated Leads Go Cold?

Here are a couple of  key points from the research paper you may find interesting.

  •  77.17% of all leads submitted never received a phone call even though calling results in 70% better chance of conversion.

  •  The optimum time to respond to a lead generation though digital marketing is 5 to 12 attempts and the average is only 4.47.

So the bottom line is, make sure that you have a sales system in place to quickly respond to leads generated through marketing activities and ensure you make sufficient attempts to get hold of the prospect.

If you need assistance with your sales strategy and lead generation Kris and her team may be able to help.

To speak to Kris about improving your sales conversation call her on 0481 344 557

    Did you know? 

    Fact – 74% of Australians say their number 1 financial goal 

is to own
    their own home – Debt Free

    Fact – 60% of Australians are set to retire WITH a Mortgage…

In today's
    cashless society, it is becoming increasingly 

difficult to keep track of
    what we are spending our money on.

    When we use cash, we can physically see how much we hand over,
    what we get back and how much we have left. When we use a card,
    we don't keep track of how much we spend or where it goes, and it
    is very easy to blow a big hole in our budget.

Even those who are meticulously organised can easily lose track. We have multiple bank accounts, and we don't keep track of
what comes in versus what goes out. At the end of each month, we hope that we have something left over for our goals and
ourselves.

We need to stop this and start putting ourselves first.  The most important thing is our happiness, and happiness comes from
security - security in our relationships and certainty in our ability to keep a roof over our head, keep the power on, have a bit
of fun, and still work towards financial freedom so that at some point we can stop working and retire.We need to save first
and spend second.

The first step to making this happen is to get organised. Decide what your monthly budget is, decide to save money for your
future before you spend money for today, put a plan in place to make this happen, and then track your efforts.

Wadeson Money Management will help you with this and track your progress, so you can reap the benefits without
having to put in all the hard work.

If you would like to:

•        Pay your home off FAST?

•         Manufacture Equity?

•         Create a secure financial future for your family?

•         Beat the banks at their own game?

•         Learn the formula for financial success?

•         Save money on your home loan – guaranteed?

Then we suggest you engage with Wadeson's trusted Money and Finance specialists.

For more information or to receive a case study contact Ross Wadeson Accountants on 9580 9866 or email us.

"Wherever you see a successful business,
                                     someone once made a courageous decision"
                                                                                Peter F Drucker

Courage can be defined as "the quality of mind or spirit that enables
a person to face difficulty, danger, pain, etc., without fear;" 
 

Well… maybe just a little trepidation…

I recently spoke to a new client who has just commenced a new business
venture. She mentioned to me that every day she is out of her comfort
zone as she confronts and learns how to run a successful business i.e. deal
with technology, debtors, marketing, staff management etc.


"Many business owners, while being comfortable with being uncomfortable, when
they first started their business are now firmly stuck in their own warm cosy comfort zone"

This got me thinking. Many business owners, while being comfortable with being uncomfortable, when they first started their business are now firmly stuck in their own warm cosy comfort zone.

What is the thing your business requires to give it the transformation that it really needs? Is it a new sales person to bring in the extra work?  Is it the marketing person that you really need to give you more support for your product or service?  What is it that is really stopping you from making the decision to obtain that vital resource?  Is it fear that you will incur additional overheads for no additional revenue?  That is a valid fear, however what is it costing the longer viability to your business by not making that decision?

"Often fear or doubt paralyses the decision making process because the business owner lacks the skills or confidence"

To push past this fear, how about you identify someone with the knowledge you require and work through your fear?  Give your business the resources it desperately needs?  The knowledge can be gained from professionals directly or sourced via a book or a workshop, or from a knowledgeable person within your network.  The key thing is that as the leader of your business, it is your job to gather the required knowledge and resources to make timely decisions in spite of fear; to demonstrate courage!  You should command performance from all areas of your business, including yourself as the leader.

If you would like to chat about any area of your business that needs consideration, reworking or if you would like a sounding board please don't hesitate to give me a call.  We have access to a lot of resources that may help.

Hooroo for now.

Ross Wadeson CPA

0411 400 356

 

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