Money makes the world go ’round
Let’s face it – money makes the business world go ’round. You need money to get your business off the ground, and once it’s established, you also need money to maintain your business and keep it out of the red. Creating an annual budget is a good way to keep your finances in check and make sure they are aligned with the goals you have established for the year. Not having a budget can cause things to go haywire very quickly, and having no plan and little to no cash flow spells curtains for your business and any possibility of turning a profit.
Begin by listing your common expenses
Make a list of your regular expenses like rent, utilities, wages, etc. You can keep track of your expenses using a spreadsheet or a budgeting tool. By having a snapshot of the money you will be shilling out on a regular basis, you can determine how many sales you need in order to at least break even, but preferably turn a sizable profit.
An often overlooked factor
Another important factor to take note of is due dates and what forms of payment are acceptable for your expenses. If the majority of your bills are all clumped around a particular week, you will need to have more cash on hand a few days prior in order to successfully pay off you expenses. Having a positive cash flow is of extreme importance in business. Liquidity allows you fast access to your money whenever you need it, without having to worry about going to through the process of transforming it from an asset into usable cash. Remember, not all expenses can be paid with credit; some require direct payment from a checking account and if that account is bare, utilities and other services begin to shut down and negatively affect your business.
Look at your budget often
Once your budget is made, be sure to review it once a month. Conducting a financial health check will keep you on track and allow you to curb any unnecessary spending. Creating an annual budget is only helpful if you stick to it, and that’s not possible if it never sees the light of day.
Forecast for next year’s budget
If you’ve made your budget and are managing it well, congratulations! But don’t forget to take into account future costs and next year’s budget. For instance, if you know your lease will be increasing next year, you may need to start diverting additional funds into a savings account or increasing sales in order to cover the added cost. Or if it’s time for some maintenance repairs, starting to increase deposits into that segment of your budget in advance will save you the shock of being slapped with a bill later on and then worrying about how to pay it.
Creating an annual budget lets you take charge of your finances and make them work in your favor rather loom ominously over your head. As a business owner, frequent financial transactions are necessary for the health of your business. By tracking your spending and limiting it to an amount that’s optimal for continued success of your business, you increase its staying power and are able to enjoy the fruits of your labor rather than cringing at your bank statements each month.
How business owners should handle the trend of COVID-19 surcharges
(BUSINESS FINANCE) COVID-19 has caused a lot of money problems, but some places have decided to counter this with new surcharges, and hopefully they told customers about them.
Hidden surcharges have long been a subject of discussion among consumers. Banks, car dealers, hotels, and credit card companies are much more transparent than they once were. According to a 2019 survey by Consumer Reports, 85% percent of adult consumers were hit by an unexpected fee when paying for a service, so the practice is not completely gone. With COVID-19, some businesses are turning to surcharges to balance out their profit margins.
Can businesses add a COVID surcharge legally?
The impact of COVID-19 is continuing to unravel. FOX8 reports that a Missouri steakhouse and sushi restaurant included a surcharge related to the rising costs of food under the pandemic. A CBS affiliate in Midland, TX reminds consumers to check their bills, because restaurants and salons are adding surcharges. Some businesses are saying that state restrictions are increasing operational costs, while others relate it to the cost of goods. Even UPS has added surcharges to peak delivery slots. According to a librarian at the State Law Library, a private business in Texas has a lot of leeway in deciding what to charge.
A surcharge isn’t necessarily price gouging
In Texas, price gouging following a natural disaster is illegal. The surcharges that we’re discussing aren’t price gouging, just a way for businesses to temporarily raise prices without changing their menu or listing new prices. The Houston BBB recommends that if your business does add a surcharge, it should notify consumers about the charge before the bill arrives. Consumers who believe that they’ve been a victim of price gouging should file a complaint with the Texas Attorney General.
Transparency is part of good customer service
According to Consumer Reports, 96% of the consumers surveyed were annoyed with a hidden fee. I want to talk to the 4%, and find out why they weren’t. A surcharge under COVID-19 conditions can make sense. Cleaning and sanitizing takes time and money. Prices have increased. What’s bad business is trying to hide those surcharges until after the customer checks out. That’s not fair. Be transparent.
Tool simplifies vendor payments, saves small businesses tons of time
(BUSINESS FINANCE) Melio is a B2B payment platform that simplifies bill payment for small businesses while freeing up their cash flow. Quick and easy, even from your phone.
The way this payment workflow tool works is that it lets you pay any vendor –including those who do not accept credit cards- using a bank transfer, or check mailed on your behalf for B2B payments.
Specializing in small business payments, accounts payable, accounts receivable, online payments, and business to business payments; it is free to send and receive payments using bank transfers/ ACH but credit card payments incur a 2.9% fee.
The onboarding is straightforward, including integration and automatic sync with QuickBooks, which is essential for many small businesses. Lots of online customer reviews via Trustpilot and other sites claim that Melio is user friendly with responsive, human customer service. Melio fills the gap between the bill payer who wants to use a credit card to pay a bill, and the biller, who wants to receive their money as simply as possible, and without credit card fees. Many small businesses have to manage the challenge of payments to purveyors such as utilities and landlords that do not accept credit cards, or want to deal with the associated merchant fees.
Melio and bill payment services allow businesses who prefer to use a credit card for payment to do so. For a small business who could really use the float and cash flow of a 21-day billing grace period of a credit card, or using a card with a sweet rewards program, this could be a valuable option.
Melio does not have a mobile app to download, but it is described on the meliopayments.com website as having a mobile-friendly, responsive web app easily-managed across devices. Most of the reviews seem to confirm the user-friendliness of this tool, and the few poor reviews I have seen involved requests from Melio for compliance documents that were not satisfied by businesses, and resulted in undelivered payments. With more than 2 years since its founding, Melio is continuing to grow and cater to the needs of small businesses in the United States who want to streamline their accounts payable process.
Politicians reconsider PPP rules too cumbersome for small businesses
(BUSINESS FINANCE) The PPP loans may have some changes coming soon, to help small businesses even more by extending the time they have to spend the money.
Congress has reported talks over fixing parts of the Paycheck Protection Program (PPP), a key program designed to help businesses during the coronavirus pandemic. Changes could range between small tweaks to an overhaul of program requirements. Congress remains divided over a phase four relief bill (passed in the House last week) which includes several of those PPP changes.
The PPP was created to provide forgivable loans to businesses with fewer than 500 employees. Although the Treasury is continuing to offer updated guidance, any significant changes will require approval from Congress.
One of the major potential changes is an extension to the eight-week time frame for businesses to spend their loan money. Senator Marco Rubio (R.-Fla.) is advocating the change. He told reporters “I think the more important thing to change is the time frame in which they can use it for,” Rubio told reporters. “We do need to give them more time to spend those monies.” The hope is to pass those changes before the first PPP loan recipients reach their deadline in early June.
Other changes proposed in the House bill include extending the spending time period to 24-weeks and eliminating the requirement for 75 percent of loan spending on payroll in order to qualify for full forgiveness. The flexibility could allow recipients to allocate money towards rent, another challenge facing small business owners. While Senate Republicans haven’t shot down that option, they’ve voiced concern on the spending rule which was originally designed to keep workers employed. Meanwhile, Democrats argue for flexibility which could support businesses with fixed costs. Both sides are open to discussing a 50 percent payroll and 50 percent additional cost breakdown in a new PPP changes.
The Small Business Administration has reported $195 billion from the $310 billion of the second tranche of PPP has been approved. With no defined plan to reopen the country, small businesses are counting on relief programs. Senior White House advisor Kevin Hassett has said the government can’t continue to lend money to businesses indefinitely. “It is something we can do through Jun, I would, guess if there’s enough cash for that.”
Google gets sued for misleading name ‘Incognito mode’
‘Small’ business was once a stigma, but is now a growing point of pride
Pier 1 couldn’t weather the storm so they’re shutting all ports for good
Samsung shines a new light on indoor health with artificial sunlight
Will startups ever fully return to offices?
Lead generation company mass scrapes emails from LinkedIn
Bistro owner rewards 1 star reviews to beat Yelps ‘algorithm’ racket
Amazon VP resigns via spicy letter calling the company chickensh*t
TikToks new augmented reality ads seeks new audiences
Microsoft launches free Python coding language courses easy peasy
Anti-surveillance mask – creepy, ingenious, or potentially illegal?
Amy’s Ice Cream founder on Austin’s business risks and rewards #WhyAustin
Turns out a lot of people are in between introverted and extroverted
P. Terry’s founder on the booming economy in Austin #WhyAustin
Ladies and gentlemen, the U.S. National Anthem
Our Great Partners
news neatly in your inbox
Subscribe to our mailing list for news sent straight to your email inbox.
Thank you for subscribing.
Oh boy... Something went wrong.
Business News2 weeks ago
The final nail has been put in the Jet.com coffin by Walmart
Business News1 week ago
Who will get to work from home once COVID-19 stay-home orders are over?
Business Entrepreneur2 weeks ago
How to turn your passion project into a successful business
Business Marketing1 week ago
Restaurant chains are using COVID to masquerade as indie food pop ups
Opinion Editorials2 weeks ago
Press mute when you’re sobbing on a Zoom (and other COVID mental health observations)
Business News1 week ago
Weight Watchers lays off 4K employees on a brief Zoom call #cold
Opinion Editorials2 weeks ago
5 Secrets to a more productive morning in the office
Business Marketing5 days ago
The secret to crafting consistently high-converting emails?