Do you really need a Business Plan?

Posted on March 26, 2012 by Administrator

When starting a business, it is important to have a working business plan.

This will allow you, as the business owner, to think clearly about your product offering, structure your finances effectively, help spot potential pitfalls before they occur, and focus your efforts on developing your business.

What is it?

It is usually a written document which describes your business in detail. It will include an executive summary, a description of your business, your objectives, strategy and the steps and resources needed to reach those goals. It will also include information about your management team and staffing, and your business’ financials.

It should be a clear and concise plan, with key facts and evidence.

Finance

If you plan to approach a bank or a financial institution for a loan, a grant or even investors, a business plan will be helpful. Supporters or investors will want to see the true potential of your business idea clearly laid out in hard facts and numbers. They will look to use your business plan for this.

Reality Check

Aside from securing external funding, it can be helpful internally; it can be used as a great reality check for a new business owner to fully develop their business idea. It may also help inspire different approaches or fresh perspectives or new creative solutions for identified business challenges. This is particularly relevant to your business’ ongoing marketing and pricing.

Living Document

Remember that your business plan is a working document, it should be regularly revisited and updated. It will help you to keep focused and allow you to think about your direction of travel.

We will be posting a guide on how to write a business plan in the next few weeks.

If you need any help or want to talk about creating a business plans or looking after your business’ financials, please contact us at

 

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Creating Cash Flow projections

Posted on March 19, 2012 by Administrator

Cash Flow forecasting is an essential part of business planning.

It will allow a business to plan and forecast when costs will arise over the next year, and also to establish what its revenue will be.

Why do this?
Forecasting will allow you to predict highs and lows in your cash balance. It allows you to plan how much and when to borrow, and how much available cash your business is likely to have at any given time.

If you are approaching the bank for a loan, they might ask to see a monthly or quarterly cash flow forecast.

Elements of a cash flow
Typically, a cash flow forecast will include:

  • Receipts: This will be an estimate of the money, which is set to come in during that period.
  • Payments: This section will detail the payments that the firm expects to have to make during the year.
  • Net Cash Flow: This will show the difference between the total payments and the receipts. Negative figures will be shown in brackets.
  • Opening Balance: This shows the money that a firm has carried over from a previous month.
  • Closing Balance: This is the difference between the net cash flow figure and the opening balance.

Advice
When creating your cash flow forecast, please remember to be realistic and, if you have an established business, base your predictions on the same period 12 months earlier.

If you need further advice on cash flow forecasts, please call us at Brilliant At Bookkeeping on 0845 519 0364 or email info@brilliantatbookkeeping.com.

 

 

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Do you need a bookkeeper?

Posted on March 14, 2012 by Administrator

Every business, no matter how large or small is required by law to ‘keep books’. This, put simply, is the recording of all the financial transactions of the business.

The main role of a bookkeeper is to look after these financial transactions on behalf of the business owner.

A bookkeeper will record these transactions in a consistent manner.

Role

You could also find also your bookkeeper to do the following:

  • Monthly or quarterly reporting
  • Bank reconciliations
  • Accounts payable
  • Accounts receivable
  • Payroll

How do you chose a bookkeeper?

A handy way to select a bookkeeper is by thinking about the three R’s: Reputation, Reliability and Regulation.

1. Reputation

Do a bit of background research about their reputation and find at all you can about them. Find out if you can speak to some of their clients and ask for recommendations.

Think about employing a bookkeeper, which works as part of a bigger brand, like Brilliant at Bookkeeping, as then you can be sure they would adhere to a certain ethical code of conduct and reputation level.

2.  Reliability

How do you know if your bookkeeper will always be on hand? Find out about their availability and processes and procedures in place, so that if the unexpected arises e.g. illness or holidays, there will be someone available to offer you advice and support all year around.

3.  Regulation

Business owners don’t often have extensive knowledge of Bookkeeping and Finance. Therefore make sure you listen to someone who does. Employ a bookkeeper, which is regulated by a governing industry body, which will ensure that they adhere to a code of ethics, such as the Association of Chartered Certified Accountants (ACCA) or Institute of Certified Bookkeepers (ICB).

If you would like to find out more about our bookkeeping services, call Brilliant At Bookkeeping on 0845 519 0364 or email info@brilliantatbookkeeping.com.

 

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Is franchising right for you?

Posted on March 12, 2012 by Administrator

Franchising can be a great option if you are looking to start a business. It offers lower risks than starting a business from scratch or going it alone. The question is: how do you know if it’s right for you?

Here at Brilliant at Bookkeeping, we thought we’d put together some of the benefits of franchising below – so you can make an informed choice as to whether its right for you.

Benefits of Franchising

1) Proven Business System

Franchising allows entrepreneurs to use a proven, successful business model. There’s no need for a new business idea and you don’t have to spend time worrying about how to build a brand – the business will be close to ready made! You should be able to select a franchise and then get started! You will be provided with everything you need to get started right away!

When selecting a franchise – ask to see or visit other franchisees, so you can get a feel for how things run.

2) Branding

With a franchise, you will be buying into an already-established brand, so there’s no need to spend lots of time or money on market research, branding and promotion.

3) Funding

If you don’t have much money to invest in a new venture – you are usually more able to secure finance from the bank if you are starting a franchise than a start up. This is because a franchise has lower risk than a start up; the business model is proven and has a history of success. Approximately 90% of franchises are still trading profitably despite the recession.

4) Training And Support

If you are a first time business owner, buying into a franchise allows you to have support and training in everything from marketing through to accounting.

5) Networking

By selecting a franchise, you will get support both from the franchisor and also from other franchisees in the network, whether that’s just advice on promotions or something more strategic.  This is also beneficial when selecting suppliers, franchisors will give you details of their long-term suppliers – saving you time, hassle and money.

If you would like to find out more about starting a franchise and to find out if it is right for you, call Brilliant At Bookkeeping on 0845 519 0364 or email info@brilliantatbookkeeping.com.

 

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What is a cash flow statement?

Posted on February 27, 2012 by Administrator

What is it and why do I need one?

There are a number of financial statements which will help you keep your business on track: a balance sheet, a profit and loss statement and a cash flow statement.

A cash flow statement is critical to ensuring a healthy business, as cash is what keeps your business afloat and functioning. It can be used to help you monitor your operations and growth. It is also an important measurement tool for investors and lenders outside your company, as it shows how solvent your company is from statement to statement, which proves that your business would be liquid enough to support its own debt and processes.

A cash flow statement, in very simple terms, records actual movements of cash in an accounting period, so that’s all the cash coming into the company (inflows), and going out of the company (outflows).

What will it cover?

A cash flow statement will typically cover:

  • Cash flow from operating activities (money from sales, or asset sales)
  • Returns on investments and servicing of finance
  • Taxation
  • Capital expenditure and financial investments
  • Acquisitions and disposals
  • Equity dividends paid
  • Management of liquid resources
  • Financing

For help on creating your own cash flow statement, call Brilliant at Bookkeeping on 01327 811164.

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Simple tips on how to write a business plan

Posted on February 20, 2012 by Administrator

Simple tips on how to write a business plan

Why create a business plan?

When deciding to start your own business, it is critical that you do some business planning. This will provide you with a 360° view of your company, allowing you to think about its viability and potential for success.

If you are going into business with partners, it is a useful tool to ensure that everyone is committed to a common vision, mission, values and goals.

It will also encourage you to think critically about your business and consider how it would perform alongside competitors. What will set you apart? Do you have a plan to differentiate yourself?

What is it?

The National Federation of Enterprise Agencies states that: ‘A business plan is a document that describes your business, its objectives, its strategies, the market it is in and its financial forecasts.’

What should a business plan include?

Typically a business plan should include:

An initial executive summary

This should summarise the detail of the business proposal and include an overview of the business’ aims, information about your products and services and details of your management team. It should also include brief financial forecasts.

A short description of the business opportunity

Why have you decided to go into business? In this section, you should include detail about business goals and what you are planning to sell or what service you will be offering and to whom. Here you should also highlight any of the features that set you apart from competitors and the market you are targeting.

Your proposed marketing and sales strategy

Here you should highlight the reasoning why people will buy from you? What pricing strategy are you going to adopt? How are you going to get your product to market? You should also outline your advertising or marketing plans?

Your management team and personnel

Outline the credentials of your key personnel and their relevant experience.

Your operations

Here you should talk about your operational equipment, including your premises, production facilities, your management information systems and IT. Also highlight if you have any special equipment, which will help set your business apart from competitors.

Financial forecasts

You should include a sales forecast, cash flow forecast and projected profit and loss account for five year’s ahead. Make sure the figures you forecast are reasonable – don’t be too optimistic!

For more information or for help in creating financial forecasts call Brilliant at Bookkeeping on 01327 811164.

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A quick start to bookkeeping with Sage

Posted on February 13, 2012 by Administrator

One in three VAT registered UK companies works with Sage software.

It offers efficiency, compliance and profitability, and this is free to all Brilliant at Bookkeeping franchise holders.

Allowing you to offer the best service possible to your clients, all franchisees are supplied with a laptop pre-loaded with Sage Accounting and all other necessary software, as well as a printer.

Getting Started

To get you started on Sage, you will need to:

  • Set Up Your Company
  • Set Up Customers and Vendors
  • Set Up Items
  • Set Up Payroll
  • Set Up Projects
  • Essential Tasks

Setting up Your Company

Before creating your company, you need to consider what your earliest transaction date will be. This could be either the first day of your fiscal year or the first day of a fiscal period (a well known accounting period).

You will need to prepare and collate all outstanding customer invoices and bills and all employee records and payroll information.

Also, make a list of all the items or services you sell. Or, if you work on projects, make sure you’ve got all information together, such as start date, status and opening revenues.

When all this data is collected and inputted into the setup wizard in Sage, you will then be ready to review your company settings and get your books filled in.

As soon as you’ve completed the setup wizard, three system settings should be reviewed immediately:

  • Sales Taxes – ensure you have selected the country you are operating in.
  • Foreign Currencies – if you have customers in other countries – ensure you specify the foreign currency.
  • Linked Accounts – Ensure that all related accounts are linked to the system – so can be all updated automatically

Setting up Customers & Vendors

To easily get started, all you need is a customer name, but if you have access to it, add in as much information as you can.

Here you can add in vendor balances and historical activities.

Setting up Items

Here you can create two types of items:

  • Inventory – these are physical or tangible items
  • Services – these are intangible items or items for which you don’t track the quantity purchased or sold.

When entering these you may want to input opening balances.

Setting up Payroll

The first thing to do is to set up:

  • Incomes and deductions you’ll use in business
  • Entitlements you provide
  • Tax rates for unemployment and employer expenses
  • Employer paid expenses specific to your business
  • Starting balances you owe Payroll authorities

Then you can enter basic employee information, in both the Employee ledger and Employee in the Setup guide.

For each employee, you could then fill in:

  • Tax information
  • Income
  • Deductions
  • Other Expenses
  • Entitlements
  • Additional Information
  • Direct Deposit

Setting up Projects

Project records can be really useful in helping you to keep track of costs and expenses incurred during a contract.

Simply create a project and fill in details such as start date and budget. It will help you to manage your budgets.

Essential Tasks

Sage allows users to easily monitor customer transactions and monies coming into the business, create customer invoices, receive customer payments and record payments from customers, pay employees quickly and easily, and record and pay expenses.

To find out more information on how to complete these tasks, call Brilliant at Bookkeeping on 01327 811164. As part of its franchise programme, Brilliant at Bookkeeping offers FREE intensive Sage training.

This blog post has been adapted from Sage Getting Started Guide 2012.

 

 

 

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Keeping your receipts in order

Posted on February 6, 2012 by Administrator

Keeping a clear record of your business transactions, isn’t just good sense, it’s a legal requirement. This means looking after your receipts.

Have you tried storing your receipts electronically?

Knowing that a large proportion of businesses store their receipts in envelopes or in big files bursting full of bank statements, invoices and purchase orders, it might be worth adopting a new process – by storing them electronically.

By this, we mean scanning receipts and storing them electronically as PDF files or JPEGs.

Space saving and easier to find, there are many advantages of storing them online.

How to start organising electronically

You could scan them into the computer using a scanner or you could take pictures of them via your smart phone/ iphone or camera. The latter has the extra benefit of being able to geo-tag, so you can easily identify where the receipt from.

By doing this, it means that the receipts are automatically organised by date, and therefore can be found easily and quickly.

However, even if you keep electronic receipts, you must organise them, or you’ll have a mess of files somewhere, and might not be able to access a receipt if and when you need it. So, decide on a consistent naming format and filing structure and stick to it!

We would recommend giving each receipt a name, which includes the supplier or service product and date, for example:

Petes_Camera_New_Camera_010112

Just for your own piece of mind, make sure you highlight which items you purchased.

If you do decide to keep electronic copies of your receipts, it doesn’t mean you can shred the originals. We recommend keeping hard copies for at least six years and if you are VAT registered, then you are legally obliged to keep them for at least six years.

Obviously hard copies can take up a lot of room, so having a scanned, electronic copy on your server and your paper originals stored securely off site could be a way of saving time and space as well as improving you filing system.

What do you think? Could electronic filing make your life easier?

For help with your bookkeeping, call us on 01327 811164.

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Top 5 reasons why franchises work for graduates

Posted on January 30, 2012 by Administrator

About to graduate and looking for a way to earn to fund further studies?

Perhaps you are not sure what to do, or have graduated or can’t find a job in an area which really appeals to you? Maybe you’re looking to earn some extra cash when at Uni? If so, it might pay to consider starting your own business, or even a franchise?

We’ve put together our top five reasons why starting a franchise could work for you:

1) Be your own boss

How many times have you said, “I wish I could be my own boss?” Franchising allows you to choose a path to suit you and your lifestyle, with support from experienced professionals.

2) Work flexible hours to fit round further studies

If you’re planning to go back to Uni to do a Masters or study for a professional certification, then having a franchise could allow you the flexibility to run a business around your study time.

3) Money to fund studies

Owning a franchise can allow you to earn while you study. Imagine qualifying without any debt!

4) Associate with a recognised brand name

One of the key benefits of opening a franchise is that it already has a reputation in place, making marketing and winning business easier.

5) A proven business model with existing supplier relationships

You won’t be alone. Choosing and owning a franchise means that there are already plans and practices in place. You will have guidance from experienced people – meaning that you can hit the ground running!

To find out more about a franchise with Brilliant at Bookkeeping, please call 0845 519 0364 or email info@brilliantatbookkeeping.com

 

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What is franchising?

Posted on January 27, 2012 by Administrator

A franchise, in simple terms, is a business opportunity that allows someone (the franchisee) to start a business by legally using someone else’s (the franchisor’s) expertise, ideas, and processes. In some cases, this means also having the right to use the franchisor’s established name and branding, as well as their already-tested business model. In other cases, this means the right to resell (or distribute) a franchisor’s products.

As a franchise holder, you effectively have the right to use someone else’s business system. You purchase this right by means of a franchise fee and in accordance with a contract, called a franchise agreement. In return, the franchisor maintains the business process and you agree to operate your business according to their model.

There are over 800 different franchised business brands operating in the UK today, examples include McDonald’s, Burger King, Bang & Olufsen, Pret A Manger, Clarks Shoes and Toni & Guy.

The important thing to note is that these franchisors are not just selling products; they’re selling a consistent way to run a business that sells products, meaning that you can capitalise on their marketing, branding and advertising, which can ultimately help you to sell more.

 

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