Category: business management

Should I Hire an Accountant or Do My Own Books?

Many business owners are choosing to hire an accountant instead of doing their own books. This can be for several reasons. But should you hire someone or handle it on your own? The answer often depends on what kind of business you’re in and how much work you’re willing to put into it. Factors like the size of your business, the number of employees, and the complexity of internal logistics might all affect your decision to either take on bookkeeping yourself or hire it out to a professional. Let’s look more closely at the pros and cons of each one and equip you with the information you need to make the right choice.

Should you hire an accountant or do your own books?

This decision is unique to each individual and involves several factors. How big is your business? How many employees do you have? Are you already finding it difficult to keep track of your books or does it come naturally? Are you comfortable with accounting software or do you feel that a real set of trained eyes would help you make better financial decisions? Is spending time on accounting worth it to you, if you even have the time? Or would you rather use that time to focus on other parts of your business?

Why people hire accountants

The main reason companies hire accountants is because they want to avoid doing their own books. Some business owners are too busy with other tasks like marketing, sales, and operations to do their own bookkeeping, so they hire someone else to take care of it for them—promoting efficiency and accuracy in the process.

Another reason many owners hire an accountant is that the accountant will make sure that your books are up-to-date and account for all the financial aspects of your business. They’ll help reduce errors by working closely with you throughout the bookkeeping process—helping you develop a better understanding of your company’s finances and accounting systems. Accountants keep your taxes clean and up to date, spot opportunities for better resource management, and free you up to focus on expansion, customer satisfaction, and product development.

If you’re a business with a growing number of employees, or you’re managing a lot of resources, hiring an accountant can help you keep your finances organized. Still, there is sometimes a fine line here. If you have less than 10 employees, there may not be much work for your accountant to do. However, even if you are a smaller company, you may not enjoy handling your own books, feel overwhelmed, or simply want to focus that energy on something else. In this case, why not hire a professional if you can afford it?

Pros and cons of hiring an accountant

Partnering with an accountant is often a great option for many businesses. They will handle all the books for your company, uncover problems early on, and help you pursue new opportunities. Their expertise includes taxes, regulatory reporting, financial statements, internal ledgers, and more. Bookkeeping programs help you with some of this, but having a fully engaged individual to watch over these key financial areas can often make the difference between consistent success and just getting by.

Another benefit of hiring an expert is that they’ll likely have a broader scope of knowledge to explore. Accountants have years of experience dealing with a multitude of businesses. They understand the hidden rules of taxes, know how to pick out seemingly insignificant details buried within financial reports, and help you put together a more focused plan for the weeks and months to come.

The primary drawback is that hiring someone requires a financial investment. Professional services like those offered by CPAs are worth it, but can sometimes be more than small business owners can afford early on.

Why some people choose to do their own books

Doing your own books is a great way to save money. It’s also a wonderful opportunity to learn a new skill, gain a better understanding of your business and get used to using accounting programs. If your business consists only of you or perhaps a couple of employees, learning how to maintain your books can be a significant step toward taking more control over your success.

Some people just like having the control within their own hands. Certain business owners simply prefer to manage most of what they do, including their bookkeeping. This is fine as long as you do your research, get the right tools, keep up with it daily, study your reports, keep detailed records, and ensure you are complying thoroughly with all tax laws and business fees.

Why sole proprietors often do their own books

Many sole proprietors agree that it’s worth it to do their own books and deal with the hassle simply because they have the time and want the control.

If they are diligent, sole proprietors can keep track of every dollar they make and spend and know exactly what’s going on in their business. When your business model is relatively straight-forward, and doesn’t involve complicated financial management, multiple overlapping departments, or employee payroll and benefits, doing the books yourself makes sense. Plus, this will allow you to see how much time it takes to handle your own books. This will help you better determine whether continuing on this path or pursuing professional accounting help is the best choice going forward.

Some difficulties with handling your own books

Mistakes: If your bookkeeping isn’t handled correctly, it could cause a financial blow to your business.

Time and Confusion: It could be more of a hassle than you originally thought, eating up time you could be using on other tasks. You may also not enjoy it enough to take it seriously and begin to miss key details within your reports.

Tax Penalties: You could miss paying taxes on time or do so incorrectly.

Energy and Focus: With everything on your plate, you may not have the energy left to spot mistakes or glean vital information from financial reports to make more strategic decisions about the growth of your business.

If you are going to manage your own accounting, make sure you have the right tools in place. Subscribe to a quality program like QuickBooks Online or Xero, or one of several others. Learn all its features and study your reports daily. Even if you;re doing it yourself, if problems arise or things get too confusing, reach out for professional help.

Conclusion

There are pros and cons to each choice. Learning how to do your own books is an important skill to master. It helps you be a more engaged and focused business owner, with an eye on the details and a better handle on what goes on behind the scenes and beneath the surface.

Hiring an accountant, whether they be in-house or outsourced, can free you up to focus on other things. They can spot errors early on, help you understand trends and patterns that either affect you negatively, or open doors toward growth, help you pay your taxes, keep you accountable to your own budget, and give you peace of mind knowing you have a partner who is looking out for you and your business.

Sound Accounts helps business owners manage their books with confidence and ease. We offer a range of accounting services to meet the varying needs of any business, letting you relax, breathe deep, and focus your attention on everything else.

For answers to accounting questions, see our frequently asked questions below.

FAQ

Why is doing the books important for me as a business owner?

Keeping up with your accounting each day is the only way for you to be successful in the long run. You’ll see where your resources are going, where you’re realizing the most profit, and which areas are leaking money. You’ll spot trends and have a clear view of where to go next. Not to mention paying your taxes correctly and on time.

Should I hire a professional or do my own books

This decision is different for each business owner. It depends on the size and complexity of your business, the number of employees you have, how comfortable you are with accounting software and spreadsheets, whether you have or can make the time each day to update financial data and study your reports, and other reasons. If you understand the importance of keeping up with your books, can navigate the software, have few employees, and are fully committed, you can manage your own books.

However, if you have a more complex business model, more employees, several accounts or departments, each with their own resources and expenditures, deal with a lot of vendors or partners, or simply don’t have the time, energy or patience to do your books, hiring a bookkeeper or accountant is the right choice. They will take the stress and worry off your plate, handle all accounting matters, spot troubled areas and trends and help you make more informed and strategic financial decisions.

As a sole proprietor, should I hire an accountant?

It isn’t always necessary to hire someone. You may well be able to handle your own bookkeeping if you have the time and desire to learn how to do it well. If your business is relatively straight-forward and you want to oversee your accounting, you can use quality software to help you manage it effectively. However, even if you are a sole proprietor, professional accounting services can often be a great choice for you. If it is an expenditure that you can afford and it saves you time and helps you stay current and make better choices, it may be worth outsourcing part-time for monthly help keeping your books.

What accounting program should I use?

QuickBooks Online is often the right choice for any business. With robust options, a range of features, well-organized reports, and solid customer support, they’ve been doing this for years and continue to improve. Other great options include Xero, Freshbooks, Netsuite, Sage and countless others. Each carries different features and varying levels of support. It is important to do your research first, and find the program that you’re comfortable with and provides everything you need.

December 29, 2021
Business Accounting: Why small businesses need to know their numbers

There’s a lot to learn when it comes to running your own business. One of the most important things you’ll need to know is the numbers. In order to gauge how well your business is doing, it’s important that you have a good understanding of what makes a business successful, especially the finer points of business accounting. From analyzing your expenses and profits to determining which accounts are performing the best, knowing the numbers is a key component to being a successful entrepreneur. You’ll be able to pay your taxes accurately and on time, and use your understanding of financial reports to make informed decisions about your business. Here are some helpful hints for understanding your numbers and how these impact your business.

Understanding your numbers and your business

The numbers, more specifically, your financials, are what help determine how successful your business is and what needs to be changed to improve its performance.

Without a clear understanding of this, you risk losing money, and nobody wants that. Afterall, I imagine you got into this game to make a profit while offering quality products and services. To understand your numbers, you’ll need to do some digging, but just remember: Numbers don’t lie. Be ready to look at things dispassionately, unflinchingly, so that you remain honest with yourself about how things are going and where you can make changes. To get a better grasp of your financial position, use these tips for getting a handle on what’s really going on in your business:

1. Look at the expenses and payments from different accounts. The first thing you should do is make sure all of your accounts are balanced and that everything has been paid for before making any decisions about cutting back on spending. Determine what expenses are truly adding to your business and which ones are dead weight. If there are redundancies or expenditures that aren’t leading to measurable growth or at the very least, increased efficiency in workflow, faze them out to free up cash for more beneficial endeavors.

2. Estimate how much profit you will make each month. This number can help you determine if you’re making enough money or if there’s room for improvement. Keep in mind that this number will change as time goes on, so don’t base any major decisions off of it too soon. It’s important to know your priorities and your personal schedule for success. Some businesses plan ahead for several months of losses or a break-even period, where the focus is more on building infrastructure and establishing market influence. If executed skillfully and other seen and unforeseen things fall into place, this should begin to shift toward profitability within a certain period.

Other businesses expect to turn a profit from the first quarter. Certain brands and markets deal in products and services that are more tangible, more easily managed and offer an earlier look at profitability.. It’s key that you know your market inside and out, that you understand where your business fits and how to determine what a realistic expectation of profitability is for your specific field and business type.

Why is ROI important?

In a business, it’s not enough to simply make money. You need to have a way of measuring the return on investment (ROI) for all of your time and effort. In order to do this, you’ll need access to information about how well your company is performing. This includes things like your monthly sales, net profit margin and monthly expenses, including payroll. By analyzing these numbers, you can get an idea of how much value you’re providing for your customers.

You can also use ROI to focus on improving certain aspects of your business. For example, if you know that the average net profit margin for your company is 3 percent, you could use that knowledge to focus on lowering costs or offering a selection of higher-tier, higher priced products in order to increase the average profit margin, as long as any cost-cutting methods don’t damage your service or negatively impact your brand in the market. This will help improve the overall performance of the business and make it easier for you to reach expected goals.

ROI helps you see the often-hidden mechanisms that lead toward profitability or losses. Beyond all the excitement of a few good months, or the worry of a few bad ones, a detailed look at ROI and all the factors that led you to those figures, allows you to get a wider, more macro view of things, so that business decisions are made with long-term growth in mind, not just immediate gains.

Business Accounting: Making sense of reports

The first step to getting what you need from your numbers is knowing what reports to look for. There are many different reports that will give you an idea of how your business is coming along, from a financial perspective, and it can be overwhelming to pick which reports you should focus on and why.

To simplify this process, here are some integral reports to consider when trying to make sense of your numbers.

– Financial Reports: There are four main types of financial reports that you’ll want to use for analyzing your business’s performance. They are accounts receivable (AR), fixed assets, inventory, and payroll.

– Profit & Loss Statements: Profit & Loss statements have three sections: income statement, balance sheet and cash flow statement.

– Expense Report: This report will list all the expenses incurred by your company in a given time period. It includes all necessary information like expenses paid out and expense categories broken down by function or department (i.e., administrative costs).

– Account Analysis report: This report provides detailed information about individual transactions (line items) that have been posted to the general ledger from other areas such as Accounts Payable, or invoiced expenditures, Payroll and Accounts Receivable (sales invoices and income received). An account analysis can help identify trends and give an indication of how a specific account is performing.

Tracking cash flow, income, and expenses

You’ll need to make sure you have a good grasp on how much money comes into your business and how much goes out. Tracking cash flow allows you to know whether your expenses are exceeding income.

You can then use these numbers to determine what accounts are performing well and which ones aren’t. For example, let’s say that you have a website that costs $25 a month to maintain. If your website is bringing in $125 a month, then it is generating $100 in profit per month (minus quarterly or annual taxes, of course). Simply put, this means that the income is greater than the expenses of running the website.

Of course, this is a simplified example. Your business is far more complex than this, involving a range of expenses, investments, financial relationships, and future goals. Keeping a focused eye on your financial reports, planning ahead, being honest with yourself, and communicating your goals are a few of the ways you can use your numbers to add to your success.

Using the numbers to make strategic decisions

As we hinted at before, knowing your numbers isn’t simply about understanding what your business is doing now, but what it might be capable of in the future. All of us want growth. We want to expand and innovate, to better meet the needs of our market and increase profitability in the process. But to do so, we need the right information.

You will never be able to plan ahead effectively or create confidently if you aren’t already managing your business finances closely. Great ideas will get lost beneath peripheral expenses and daily worries. Expansion will give way to debt. That’s why having the right people and programs in place to help you understand the numbers and what they mean for your business is key to building the future you envision.

Creators and CEOs that are constantly innovating and dominating their respective fields all understand the impact that numbers have on strategy. They spend a great deal of time studying to know where they can cut back, where they can bulk up, where they can shuffle money to better meet their goals, and ultimately, how to lead responsibly with both people and their numbers in mind. A successful future only happens with good grasp on the present.

Using the numbers to Identify trends

Another aspect of using the numbers to make strategic decisions is in identifying trends. In order to identify trends, you need to know what those numbers are. Financial statements don’t just present you with raw data about your profits and expenses. When viewed over time, quarterly, bi-annually, annually, then over several years, patterns emerge from the sea of figures.

You’ll see things you didn’t know were even there, odd expenditures, under-performing resources that need updating, over-performing departments that deserve more resources to maximize on their upward trajectory, different biases toward certain aspects of the business which can imbalance the foundation of your work. Trends allow you to spot opportunities, places where outside investment or partnerships might bring a lot to the table and help you see where additional cash flow can be utilized to create something new.

The right tools to keep track of your numbers

There are several ways to track your numbers. Using the right tools can make your life easier and your business more successful. The best tools involve both human and physical resource capital. It is important that you get the best software or cloud-based programs to manage your finances well. Programs like QuickBooks Online and Xero are perfect examples of these. Both have different plan options to meet the varying needs of businesses of all sizes and types. You can also use common programs like Excel and Google Sheets to create spreadsheets and databases.

The human component is probably even more important. Whether you hire a full-time accountant or bookkeeper, or outsource to a professional for part-time work, having someone around that you can trust implicitly with understanding and tracking your numbers is one of the most important things you will ever do for your business. Don’t underestimate the power of a good financial professional to help you balance your budget and spot opportunities for future growth.

Conclusion

The only way to be successful as a business owner is by knowing your numbers completely. This helps you keep a healthy budget, remain profitable, innovate and plan for future expansion. Be sure to put the right resources and people in place to help you do this. Purchase or subscribe to quality accounting software, get a financial professional to watch over your numbers, communicate often, study and understand what your numbers mean, and act upon discrepancies quickly, before they grow into larger problems. Knowing your business means knowing your numbers. And knowing your numbers means the difference between a business that merely survives, and one that thrives.

Sound Accounts offers dedicated accounting services to businesses of all sizes. We help new and established business owners manage their finances with skill and ease, so they can make smart choices for their brand, their customers and their long-term growth.

For quick answers about knowing your numbers, check out our frequently asked questions below.

FAQ

Why is it important to know my numbers as a business owner?

Knowing your numbers not only gives you a clear picture of how your business is performing, but helps you spot patterns within past performance and opportunities for growth. WIthout a solid handle on your finances, you will never be able to consistently succeed or measure this success in a way that allows you to build upon what you’ve established. Business owners that understand their financial reports and use them to plan ahead, are always more successful than those who ignore their numbers.

What kinds of reports should I understand?

Though there are others, it is important you understand Financial Reports, including accounts receivable (AR), fixed assets, inventory, and payroll, Profit and Loss Statements, Expense Reports and an Account Analysis Report.

What are the most important tools for managing my numbers?

These include both programs and people. Excellent software or cloud-based programs like QuickBooks Online and Xero are perfect, feature-rich tools. Also, don’t overlook the most important thing, hiring or contracting an experienced accountant or bookkeeper to watch over and help you manage your business finances. They can help you better understand your numbers and spot opportunities while saving you money by cutting costs where redundancies or inefficiencies exist.

December 22, 2021
How can I expand my business without taking out a loan?

Creating a new business is an incredible undertaking in its own right. But expanding on your success involves new ways of thinking, new approaches to funding, partnerships, and innovation.

The most obvious way to begin your expansion with the resources you need is to take out a loan. While this is a great solution for those who can do so at affordable interest rates, there remains a handful of possible downsides to taking on more debt. Thankfully, when asking “How can I expand my business without taking out a loan?” you have plenty of solutions that don’t include additional loans, with countless opportunities for freelancers and entrepreneurs alike. We’ll take a look at a few of these in this article.

Understanding the pros and cons of borrowing money

The decision to borrow money to grow your company is a big one. While borrowing money can be beneficial, there are also risks involved. The most obvious upside of borrowing money is that you’ll be able to access the resources, staff and technology you need most to expand your current vision. If you have a good credit history, securing loans with more reasonable rates may be possible. Loans allow you to expand without taking on equity partners, dividing your profits, or worrying about paying friends or relatives back, something that can often negatively impact relationships. Still, there are also many cons to borrowing money for your business.

– You will likely have to pay high interest rates on the loan

– You may not be able to repay the loan by the deadline

– Your business may fail and you’ll need a new job while still having to pay back the loan

-Defaulting on your loan or having too many late payments will damage your credit, making it more difficult to access the credit you need in the future.

Find low cost or no-cost ways to expand your business

Taking out a loan is usually the most straightforward way to expand your company. However, there are several low cost and even no-cost ways to grow your business. When we’re in the thick of things trying to keep our business going strong, it’s easy to get tunnel vision and think that we don’t have many options. But this just isn’t so. A more creative and less-costly approach may be exactly what you and your business need.

If you’re looking for more creative solutions, consider applying for grants, crowdfunding, franchising, partnering with other companies or taking on an equity partner. These methods can help you grow and increase your brand’s footprint without taking out a loan.

Explore your options for grants

There’s no shortage of grants available to support small businesses. For example, the Small Business Administration offers a variety of grants for entrepreneurs. The SBA is a good resource for grants and can be found on their website:

https://www.sba.gov/content/for-entrepreneurs-and-small-businesses

We recommend checking out their programs and determining which grant fits your needs best.

Additionally, individual states, counties and cities offer unique programs for small businesses, many of them featuring grants for a range of business types. That’s money you don’t have to pay back. While some grants may not be as large as the loan you wanted, these funds can take a large bite out of your need, get the ball rolling on the initial steps of expansion, and allow you more freedom with less financial strain. Check out the primary business resource websites for your city and state for more information on grants.

Explore your options for crowdfunding

Another superb option for financing your business is crowdfunding. It’s an effective way to raise money without having to take out a traditional loan from a bank. You can crowdfund for general business expansion. However, crowdfunding works best when applied to a specific project, product, or tangible growth strategy. Think about what specific projects or product and service launches you would like to accomplish and create a crowdfunding campaign for these. Here are some tips for using crowdfunding:

Think about what kind of project you want to launch — it could be anything from a new product or service to an invention, or a new and creative way of doing something you’ve done for a while. Be precise.

Keep your breakdown and pitch short, sweet, and simple. This can make things easier when you’re trying to raise money, as it’s less intimidating for people who are unfamiliar with the topic. Trust in your audience’s intelligence and desire to help. But don’t tax their patience with unnecessarily long explanations and complicated charts. Spend some time thinking about the core of your project. Distill it to its essence, map it out in simple, bold terms, and present it with confidence and ease.

Make sure you have a clear goal in mind before going live on Kickstarter or Indiegogo. Know the dollar amount you need to achieve your goals. Be realistic but be careful not to be too conservative with your estimate, simply hoping to not scare people away. If you present your ideas well and justify clearly why you need the amount you are asking for, people will respond.

Use social media platforms like Facebook and Twitter to help spread the word about your campaign and how much has been raised so far. The more people you get talking, the more people will want to partner with you on your journey and benefit from your expansion when it happens.

Communicate often! If people don’t know what they’re getting in return, they might not donate money. And if they do donate, they might not give enough because they’re not being updated regularly. Keep them in the know. Make sure your donors feel like partners in a creative or meaningful endeavor, not like strangers throwing money to other strangers. Communication and excitement are key.

Explore your options for partnerships

If your business is just starting out, there are a number of ways to partner with other companies. For example, you can partner with a company that helps support your audience, markets to a similar customer, or offers products and services that complement many of the things you do without being in direct competition.

Partnering with another company can provide a wide range of benefits, such as exposure for the other company’s products and services and the opportunity for cross-promotion. You should also consider how much control you will have over the partnership if it goes well.

If you’re looking to expand without taking on debt, partnerships are a great way to help grow your business with no startup costs.

Franchising can be a great way to grow a business

One of the best ways to grow your business is to franchise it. Franchising allows you to expand your company into a larger market while keeping control of your brand and not having to take on additional debt.

There are different types of franchisors: Direct franchisors offer complete support for the franchises, which includes training, marketing, resource vendor partnerships, and more. These types of agreements usually allow the franchisee to operate a single storefront or location with the possibility of purchasing additional locations in the future.

Other types of arrangements, like area development or master franchising, offer franchisees the ability to develop a presence in a larger geographical area, essentially giving them business and expansion rights within a region.

In many cases, expanding your business through franchising, if your business model allows, is a less expensive option than partnering with an outside company or taking on additional loans. Oftentimes, offering franchises allows you to widen your influence and the impact of your organization and brand without leveraging yourself too heavily.

Exploring Equity Partnerships

One more road you can take when thinking about expansion is securing equity partnerships. In simple terms, these are like the agreements reached by two parties on the show “The Shark Tank,” where a company offers a future percentage of profit or revenue in exchange for up front cash investments into their business.

This allows you to skip high interest rates and additional credit debt. However, remember that you will probably have a partner for life unless the contract is written otherwise. This means that your new partner will often have a partial say in how and what you do in your business and will continue to collect their profit points as the years roll on. This means less debt and a cash injection for you, but less autonomy and a loss of profits.

Conclusion

You can’t always borrow money to expand your business. Other methods can help you grow and avoid taking out a loan. Find low-cost or no-cost ways to increase your revenue by exploring your options for grants and crowdfunding. Consider different types of partnerships and see if franchising might work as a business growth strategy.

Business expansion is exciting. It can mean greater impact within your market and in society as a whole. It can also translate to a growing income for you, your family and your employees and partners. Still, it is important to do your research, know your finances inside and out, compare your options for funding and use those that offer you the greatest benefit while maintaining a reasonable level of risk. It’s time to get growing. And there are more ways to do so than most business owners might think.

Sound Accounts offers dedicated accounting services to new and growing businesses, helping business owners like you achieve the expansion they desire by helping them manage their budgets successfully.

December 15, 2021
5 Business Budgeting Questions Every Small Business Owner Should Ask
As a small business owner, one of the most important things you can do is ensure that you have a good budget for your company. Many people start businesses because they have a dream of what their service or product can give to the world. But in order to provide these services, you have to ensure the financial health of your business. This requires attention to your business budgeting.

How much money do you need to run your business successfully? How much money does your business require to survive? What does a good budgeting process look like? How do you determine a budget period? A successful business requires a well-planned budget. If you don’t have a budget, then you won’t know if you are spending too much or too little. A well-planned budget should also keep both short-term expenses and long-term goals in mind.

Here are the top budgeting questions that every small business should have:

1. Do you have a budget for your small business?

This might seem like a silly question, but it really is the most important one to start with. If you don’t have a budget and aren’t keeping track of what is coming in and going out of your business, then you have no clear picture of the financial health of your company. This could make for some uncomfortable surprises when you start digging into the numbers.

A budget is a roadmap for your company, so whether you are just thinking about starting a business, you’ve got some side hustles going, or you have a full-time business, you need to figure out a budget so that you know where your company is headed financially. You can’t effectively plan for business growth without knowing where your money is going.

2. What should be included in your small business budget?

When you are starting out as a small business, it can be hard to know how to make a reasonable and realistic budget. You may have significant start-up costs, or you may be able to hit the ground running with just your laptop. Remember that a budget is your plan to understand and control your finances, ensure that you have enough cash flow to pay your bills, and plan ahead for the future of your small business so that you can make confident financial decisions.

Regardless of industry or how you set up your business, you need to have a solid budgeting process in place. A standard budget should include the following:
- Cash flow projections: your cash budget allows you to project your cash position on a month-by-month basis.
- Costs: for a typical business, your costs can be broken down further into three different categories:
  - Fixed costs: these can include salary, rent, and financing costs
  - Variable costs: these can be inconsistent but should be accounted for, and could include things like overtime pay for staff
  - One-time capital costs: This could include the purchase of computers, equipment, a business location, or other one-time capital expenses.
- Revenue: these are current sales or other income and can also include a forecast based on sales history and how you expect your small business to perform in the future.
3.What are your regular expenditures, and do you have significant capital expenditures coming up in the fiscal year?

Budgeting well involves anticipating both your regular expenses and big, unexpected, or one-time expenses that may come up in the fiscal year. When you are working on your budget, think about expenses that you need to plan for in advance. It can be all too easy to just think about your regular, month-to-month expenses, but your actual expenditures are also going to include one-time, capital, or unexpected expenses, so you need to plan accordingly.

Is there equipment or technology that will need upgrading or replacing? Do you have a peak sales season that will require you to purchase more inventory in advance? Are you planning to move into a brick-and-mortar space? Think about the unique aspects of your small business that may require significant capital this year, and plan ahead to make sure your business stays on track financially.

4. What are your projected sales for the next quarter and through the end of the fiscal year?

Using both sales and expenditure forecasts can help you project your profit margin for the next 12 months, which will allow you to make smart, fiscally sound business decisions. If you want to grow your business, you’ll need to know what your profit margin is so that you can wisely invest in new products, services, marketing campaigns, or technology. Using both sales and expenditure forecasts allows you to see how much money you spend on different items. By knowing how much you spend on certain items, you can plan ahead and save money.

5. How often should you review your budget?

Let’s say you have done all of the above. You have your budget and projections and business plan, you have a good idea of what the coming fiscal year will look like, so you’re done, right? Well, not really. Budgets aren’t a one-and-done item that you can check off your to-do list forever. They need to be reviewed and updated regularly to ensure that what you laid out in your budget actually matches the reality of where you are spending and making money with your small business. This doesn’t mean you need to go over it with a fine-tooth comb every day; that wouldn’t be an efficient use of your time. Instead, your budgeting process should include time to review your budget at least once a month, with a more in-depth look at your annual budget a few times a year to make sure that you are meeting your financial goals. If you are not meeting your goals, then you need to adjust your budget accordingly and maybe revisit the strategic plan for your small business.

Working with an experienced bookkeeper can help make your budgeting easier. Sound Accounts works with businesses of all sizes and we offer bookkeeping, licensing, payroll, quarterly reports, office management, and notary services 100% remotely. Let us keep your accounts safe and sound so you can focus on your business.

For some answers to common business budgeting questions, check our our frequently asked questions here:

FAQ’s

What is a small business budget?

Like any other budget, a small business budget is a document that helps you identify your financial needs. It also serves as a tool to help you manage your finances. Your budget should include three main categories: income, expense, and cash flow.

How do I set up my small business budget?

The first step is to determine what your monthly income is going to be and what your monthly expenses will be. Then, you’ll add up these two numbers to get your monthly net income. These may just be guesstimates when you are first starting out as a new business owner, but even having a general idea can help you make good budgeting decisions when you are just starting out.

How often should I review my small business budget?

Budgeting is an ongoing process. You should review your budget at least monthly to ensure that your small business finances are on track. You should also take time quarterly to review it more carefully and plan for big expenses, capital improvements, or peak customer seasons that may come up in the fiscal year.
December 8, 2021
Home Office Deductions: What is Allowed and What to Avoid

Many people took the opportunity to start their own small businesses in 2020 and 2021. During the heart of the pandemic, a record 4.4 million new businesses were created. Up significantly from an annual average that has rested around 600,000 per year for the past quarter century. Nearly 32 million small businesses currently operate in the United States. If you were one of those new business owners or sole proprietors in the past few years, or you are looking to start a new business in 2022, the idea of working from a home-based office is an attractive one.

Many new business owners start out by working from home and the great news is that many home office supplies can be deductions for your small business. But what is and is not eligible to be written off on your taxes? As a home-based business owner, do you know what you are allowed to expense? Do you know what counts as an office expense deduction? Let’s review some broad categories for home office expenses and break down what is allowed and what to avoid when filing home office deductions for your small business.

Home Office Deduction

The home office tax deduction applies if you use a specific portion of your house regularly and exclusively for your business. This is mainly based on the honor system, but here are a few examples that you can think about when deciding how the home office tax deduction applies to your unique business set-up.

If you have a room that is used solely for your home office, such as a second bedroom that is not used for anything other than your small business activity, then that would qualify for your home office deduction because it is a dedicated space for your business. However, if you have that spare room set up as an office but occasionally work from your dining room table, you could not also include the square footage of your dining room to increase the deduction for your home office expenses. The dining room is obviously used for activities outside of business purposes.

Another example would be independent contractors who are able to do all their business from their laptops and choose to work from their kitchen table. In that case, it is going to be impossible to quantify the use of the whole kitchen as an acceptable home office deduction. A kitchen will never be seen as a principal workplace or dedicated space for business because it is impossible to prove that it is used exclusively for your business. So not only do you need to prove that the space is used to run your small business on a regular basis, you also need to prove that the space is not used for any other purposes.

There are also two different ways to go about quantifying the home office deduction and calculating the office expenses for use of the space; the regular option and the simplified option. With the simplified version, rather than deducting expenses you’ll calculate the square footage of your space and multiply it by the rate of $5 per square foot up to 300 square feet of space. This means that, at a maximum, you would get a $1500 deduction for your home office.

With the regular option, you’ll value your home office tracking the actual expenditures of the space against your total home expenses. To do this, you’ll have to add up allowable deductions including mortgage interest, taxes, maintenance, repairs, utilities bills, insurance, and other related expenses. Then you’ll calculate the percentage of those expenses for the size of your home office.

The simplified method is obviously easiest, but you should consider going with the standard method if your home office space is significantly larger than 300 square feet or if you feel that your home expenses and utility bills would put the deduction value of your home office above $1500. Your tax preparer can help you understand which of these methods will be best to track the legitimate deduction for your small business.

There are also a few exceptions that relate to specific types of business owners, one example being if you provide day care services or run a daycare facility from your home. Another example is that you use part of your home for the storage of inventory. If you have a significant amount of inventory and product samples in storage in your home, you can potentially use this exception. Check with your tax preparer prior to tax season to see if there are any exceptions that could apply to your home office space.

Internet and Phone Deductions

If you work out of a home office, some of the most common types of expenses you could deduct are your internet services, telephone service, and fax bills. For a home-based business, those are easy to quantify as a tax-deductible expense. However, you can only count an office expense deduction that is directly related to your business. This means you can’t expense the entire cost of your home phone and internet bills simply because you work from home; to be a legitimate business deduction it has to be related to the running of your business.

It can be tricky to figure out what was purchased for personal purposes and what are deductible home office expenses for business-related activity. The easiest way to manage this is to either add a second phone line to your home, or get a cell phone to use exclusively for your business. Otherwise it will be very difficult to determine what calls were made for personal use vs. what calls related to your home-based business.

Similarly, it can be challenging to know how to deduct a portion of your internet expenses. What you can consider is the cost to build, maintain, and manage your business website. Those are reasonable expenses to deduct if you use a website to manage your current business.

Office Supply Deductions

To be able to deduct office supplies you have to prove that they are ordinary and necessary business expenses, and not materials for personal use. So a printer that is stored in your home office space and not used by anyone else is an acceptable expense, whereas a printer that is used by all members of your family (for example, your kids use it for homework) is not going to be approved as a home office deduction.

Likewise, if you do a school supply run for your kids at Target and decide to grab some office supplies for yourself at the same time, it is going to be a challenge to itemize what you purchased for household use and what you purchased for yourself in order to submit an itemized deduction of office supplies.

An easy way to get around this is to use your business bank account for appropriate office supply expenses. That way your receipts and bank records will already be separated from family expenses and household budgeting and you will have an easier time identifying your business purchases. If you are trying to estimate your business taxes, it is much easier to identify appropriate business tax deductions if you are only looking at your company’s bank account. Maintaining accurate records and separating your personal expenses from your business expenses is always recommended, especially for home-based business owners.

The best way to keep track of all potential tax deductions is to have an excellent bookkeeping system in place to keep detailed records of all your business transactions. Sound Accounts provides bookkeeping, payroll, and licensing services. Whether you have a small business or sole proprietorship, and whatever stage your small business is at, we can work with you to provide accurate accounting and payroll support. Contact us to learn more about how we can serve you!

For answers to some standard tax deduction questions, check out our frequently asked questions below:

FAQ’s

What is a home office deduction?

According to the IRS, a home office deduction allows qualifying taxpayers to deduct certain home expenses on their tax return if they run a small business or do work for their small business from home.

What qualifies for a home office deduction?

There are many home office deductions that you may qualify for. The biggest one is usually deducting a specific amount for the physical space that you use in your home for small business operations. There are both simple and standard options for calculating the amount of deduction for your home office space.

Are there limits to what I can expense or deduct for my home office?

Yes, there are some strict stipulations for what you can expense. To get the deduction for the use of a physical space in your home, it has to be a space that is used exclusively for your small business. For office supplies, again they must be used exclusively by you for the management of your small business. There are a few highly-specific exceptions to these limits, so check with your tax preparer to ensure that you are getting all the deductions that your small business may qualify for in 2021.

December 1, 2021
2022 business tax deadlines

Whether you became a new business owner in 2021 or you are a seasoned professional, when tax time comes around everyone takes pause to make sure that they are prepared for tax season and know exactly what their business tax deadlines are. We’ll take you through the tax dates you should be aware of in 2022, and how they differ based on the type of business you own.

If you are self-employed, Forbes recently published a great article with a simple infographic that shows tax forms by type of tax, due date, and who those taxes apply to.

If you know what form you file under, skip ahead to that section to see the 2022 tax deadlines. Otherwise, read each section carefully and check with your tax person to see what forms and deadlines apply to your small business. Tax rates vary, and you will either be required to file on an annual or quarterly basis. You will also be required to provide tax paperwork for each employee.

Employment Taxes

If you have an employee or employees who you pay an hourly rate, tips, or any other wages or compensation, then you as the employer are responsible for filing and paying employment taxes.

W2s and W3s

If you have employees who are receiving wages or compensation of any kind, you’ll provide them with W-2s or W-3s, due by February 1.

Form 940

Similarly, if you pay wages of more than $1500 in a quarter, or you have an employee or employees for more than 20 weeks out of the calendar year, Form 940 is also due by February 1.

Forms 941 and 944

If you pay your employee or employees wages subject to federal income tax withholdings, Medicare and Social Security taxes, Form 941 is due quarterly by January 31, April 30, July 31, and October 31. But if all of the above is true and you also expect to owe less than $1000, then you would file Form 944 just once by January 31.

Miscellaneous and Nonemployment Taxes

If you work with contractors, freelancers, or pay for other services to someone who is not your employee, then there are some miscellaneous tax forms that you’ll need to use. These miscellaneous services can include freelancers and accountants that provide you with legal, administrative, advertising, and other professional services.

Form 1099-MISC and 1099-NEC

If you make payments for services or work from contractors or other non-employees, you’ll file Form 1099-NEC by Feb. 1. If you need to report other income, such as rents, royalties, prizes, or awards paid to third parties, you will need to file form 1099-MISC by March 1.

Self-employment Taxes

For self-employed individuals and sole proprietors with no employees, you’ll file self-employment taxes.

Form 1040

If you have an income or a loss from your self-employment in 2021, or you choose to file as a sole proprietor, you’ll file form 1040 by April 15 for your self-employment income tax.

Form 1040-ES

However, if you expect to owe more than $1000 at tax time, be prepared to file quarterly with the 1040-ES form for estimated tax payments. Making estimated payments protects you from taking a big hit at the end of the year. Your quarterly payments will be due by January 15, April 15, June 15, and September 15. It is important to stay on this schedule because you may be charged a penalty by the IRS if you do not pay enough in taxes or fail to pay on time.

S Corporation & C Corporation

There are unique benefits accompanying both S and C corporations and each requires different tax filing procedures to stay current and avoid penalties.

C Corporations are subject to double taxation. Any profits earned by the C corporation are taxed at federal corporate income tax rates which start at 15 percent. Also, several states apply a corporate income tax. When owners are paid a salary or receive dividends, these payments are also taxed at their personal income tax rates without any adjustments being made for the corporate taxes which have already been paid.

S Corporations don’t pay federal corporate income taxes. Every single shareholder reports their share of the annual profits or losses on their own tax return. This figure is taxed at the shareholder’s personal income tax level.

Filing with an S Corporation or C Corporation

Both C and S corporations are required to file a federal income tax return. C corporations will use Form 1120 to calculate their taxes due. S corporations use Form 1120S as an information return. Additionally, S corporations must prepare a form 10 K-1 for each shareholder to include with their own individual return.

Payroll Taxes for C & S Corporations

While both S corporations and C corporations are responsible for income tax withholding and payroll taxes for salaried employees, S corporations have some additional requirements to take care of during tax time.

To assure that you prevent tax avoidance schemes, distributions to S corporation shareholders “must be treated as wages to the extent the amounts are reasonable compensation for services rendered to the corporation.” In essence, S corporation shareholders cannot take dividends instead of a salary to avoid payroll taxes. This is an area where S corporations are heavily audited to assure legal compliance.

For the most part, C corporations escape scrutiny with regard to how owners are paid. Salaries are deductible and dividends are not, so any gain shareholders receive by taking dividends in place of a salary is mostly canceled out by double taxation.

Several, but not all, states will exempt S corporations from state corporate income taxes. They pass these profits or losses on to the shareholder to be taxed on their personal income tax returns. All appropriate tax forms must be filed by March 31.

Tax Penalties

We mentioned tax penalties earlier, that you could incur by not filing on time. It is important to know that those penalties increase the later you are filing your taxes. It’s not a single time late fee, it is a fee that gets exponentially higher the later you are with filing. Protect your small business assets by making careful note of these dates and giving yourself plenty of time to gather the information needed to file on time.

Quarterly Penalties

When you are paying quarterly taxes, the first one of the year is due on April 30. If you wait until May 3, you’ll incur a 9% penalty. Delay until June 1, and that penalty increases to 19%. File by October 1, and you’ll be paying a whopping 29% penalty to the federal government.

Those penalty rates are the same for each quarter. If you miss the first deadline, you’ll pay 9%. The second missed deadline means you’ll owe 19%, and the third deadline missed will get you a 29% fee. So it’s better not to be late at all, but here are the deadlines for each of those penalties for the remaining three quarters.

Taxes in the second quarter are due July 31, with the first penalty fee beginning on August 2, the second penalty on November 1, and the third penalty on October 31. For the third quarter, taxes are due on October 31, with increased penalty dates on November 1, December 1, and January 4. In the fourth quarter, taxes must be filed by January 31, with penalty dates on February 1, March 1, and April 1.

Annual Penalties

Even if you are just filing your taxes annually, you can still owe fees to the federal government if your taxes are not submitted by April 15. The 9% penalty begins on April 18, the 19% penalty on June 1, and the 29% penalty on July 1.

The lesson here is that even being just a few days late on your taxes can result in a significant portion of your earnings being lost to late fees.

FAQ’s

When are the 2022 tax due dates?

If you are filing annually, your taxes are due on April 15. When filing quarterly, they are due April 30, July 31, October 31, and January 31.

What happens if I am late on paying my taxes?

If you are late on filing your taxes, you will incur a fine or fee from the IRS.

How much are the late fees?

The fees increase based on how late you filed your taxes. The first missed tax deadline will incur a 9% fee. The second and third missed tax deadlines will incur 19% and 29% fees respectively.

Sound Accounts provides bookkeeping services to small businesses. While we do not provide legal advice or tax filing services, our excellent and detail-oriented bookkeeping ensures that tracking your business activity and compiling your records for tax time will be a breeze (Just as long as you file your taxes on time!)

November 24, 2021
QuickBooks Online Tips for Small Businesses

If you’re running a small business and new to accounting, then QuickBooks Online is an excellent tool to keep track of your finances. It is a cloud-based accounting software program that allows you to manage your business finances and have a record of each transaction. You can use it to view all of your financial information in one place, pay bills, send invoices, track expenses, and much more. Whether you are a new business owner or just new to using QuickBooks, there are a few things that will help you hit the ground running with QuickBooks Online.

Here are 5 quick tips that will help you get started:

1. Create Your User ID and Password

The first step to getting started with QuickBooks Online as a business owner is to set up your User ID and password. With this, you can access the software from anywhere on any device. To create an account, you need to enter your name, email address, password, and security question. After that, you can log into your account. You can change your password anytime and you can also set up reminders to help you remember your login details. This way, you won’t have to worry about forgetting them when you want to check your accounts or make changes.

2. Set Up Your Company File

The first time you log in to QuickBooks Online, a setup wizard will prompt you through the process. You’ll enter your basic company information (business name, address, contact information.) Then you’ll be prompted to enter more details for your business. These include your industry, the product or service you sell, and your company type. You can add information for your accountant or bookkeeper now to give them access, but you can also skip this and fill out this information later on. You’ll also have the option to import data from QuickBooks, Windows, or MYOB. You can also choose your payment method and select your preferences (cash, check, PayPal, direct deposit, etc.)

Once you click next, the setup wizard will create a list of customized features for you to use. Because this is a customized list, know that there are more feature options and you always have the ability to turn any feature on and off. The suggested customization is based on the information you enter, so it can be helpful to use when you are first starting out and getting to know the QuickBooks Online tool.

You can further tailor your settings by choosing the Company Settings option under the Cogs Company Preferences menu on the upper right hand side of the screen. The Company Settings window will show you four tabs that can be edited for your business requirements. From the Company tab, you can upload your logo, edit your business name and contact details, add your ABN, select your language preference (which is defaulted to English), and more.

From the Sales tab, you can customize your forms, set up default sales invoice terms, and shipping and inventory information, and create default messages for emailing invoices and other business forms. You can also create custom fields and custom transaction numbers from the Sales tab.

The Expenses tab is pretty self-explanatory, but this is where you can track expenses and items by customers, turn on purchase orders, make items and expenses billable, and enter default bill payment terms.

The Advanced tab allows you to manage more complex actions. You can enable account numbers, discounts, automations, and time tracking. You can choose the first month of your financial and tax year. You can close your Books to lock the period down if needed. You can select your currency. You can also enable warnings so that you are notified if duplicate check or bill numbers are used.

The gear icon is also where you’ll find a number of additional tabs that will help you in completing the setup process. The Chart of Accounts tab lets you set up accounts for your industry. The Products and Services tab, which allows you to add services, inventory, and income amounts. From the Manage Users tab you can go in and add your accountant or bookkeeper and other members of your staff. You can use the Transactions>Banking tab to add bank accounts, credit cards, and set up your bank rules. The Employees tab lets you turn on and off payroll. The Customers and Suppliers tabs allow you to add accounts for people in those categories. The Customer Card Information screen allows you to manually add in and save customer pay information and preferences. From the gear icon, you can also customize your Style, Appearance, Header, Activity Table, and Footer.

Finally, the gear icon allows you to Import Data, which is an important step if you are transferring business information into QuickBooks Online. You can import both customer and supplier information, your chart of accounts, and your products and services from another software. You can access these options from gear icon>Tools>Import Data.

If you don’t already have some sort of contact list setup within QuickBooks, you may find it helpful to import a CSV spreadsheet containing customer names and addresses. For payroll purposes, you might consider importing employee transaction records from a separate system like Gusto.

3. Learn How To Use The Software

When you first open QuickBooks Online, the welcome screen will offer links to tutorials, support resources, and other useful tools. After that, these items can be found via the link labeled “Help & Training” at the bottom left corner of the homepage. This will lead you directly to a series of instructional videos designed to walk you step-by-step through all aspects of running your business using QuickBooks Online.

As intuitive and user-friendly as QuickBooks Online is, making use of these training videos and quick-start guides gives you a head start and makes sure you understand all the tools that this software has to offer. You can review the videos anytime you wish, although we recommend scheduling time to watch one per day and familiarize yourself with each new tool before moving on to the next. Building this learning time into your daily routine will help you quickly familiarize yourself with the software.

And there’s no better way to learn how to use QuickBooks than by actually doing it! After you watch videos about basic features like entering transactions, creating reports, or setting up payroll, do your “homework.” Make use of that knowledge while it is fresh and set up those aspects of your business in QuickBooks Online as soon as you complete each video or training.

4. Access Your Reports

Once you’re logged in and have your company file set up, you can access your reports from the left side of the screen. Available features include charts, graphs, and the ability to generate PDFs for your reports. You can choose between a variety of standard reports such as Balance Sheet, Profit/Loss Statement, Income Statement, Cash Flow Analysis, Accounts Receivable Aging Report, Sales By Customer, Expenses By Vendor, Purchases By Employee, Inventory Valuation, and Budgeted vs Actual Spending.

Whatever service or product your small business provides, there are likely several standard reports that will get you the information you need to run your business. QuickBooks Online also provides the ability to create custom reports tailored specifically to your needs, and you can set up any report to run automatically at certain times, saving you time and allowing you to work efficiently as a business owner.

5. Get Help With Specialized Needs

QuickBooks Online offers specialized services geared towards helping a variety of small businesses manage their finances efficiently.

For example, if you sell products over the internet, you may find value in QuickBooks Point Of Sale. POS allows you to track inventory levels, calculate taxes, accept payment, and much more. If you operate an eCommerce store, then you might benefit from QuickBooks Merchant Services which includes similar functionality plus credit card processing capabilities. And if you provide accounting services, then Intuit Business Solutions can assist you with bookkeeping tasks including invoicing clients, tracking expenses, generating financial statements, and preparing quarterly income tax returns.

If you feel like you can’t find specialized options that work well for your particular situation, don’t worry – just contact customer service and ask them what else could possibly fit your needs. QuickBooks Online offers 24/7 support services so you have on-call support anytime you get stuck or have questions about the features.

Sound Accounts is an expert in supporting small business accounting needs. We can help you get the most out of QuickBooks Online to support your growing business needs. Contact us today for a free estimate of services.

November 17, 2021
How do I Know it’s Time to Expand My Business?

Small business ownership is a journey that is full of unknowns, especially in the beginning. It is exciting to own your own business, but it can also be challenging knowing that all the decisions fall on you. One of the biggest decisions you’ll face as a small business owner happens when you ask yourself, “When is the right time to expand my business?” Here are four signs that your small business might be in a good place to expand.

1. You have outgrown your space, or you can’t keep up with demand

So you’re bursting at the seams at your current location and you are so busy that you can’t keep up with your customer demands. That’s great news! But that’s also a clear sign it is time to expand your business.

If the demand for your product and service exceeds what you can produce, it is definitely time to expand. There is clearly a target market for what you have to offer. If your customer base is clamoring for more, why not expand your business and make the changes necessary to meet the demand?

Outgrowing your space is also a clear sign it is time to expand your small business. Whether you and a business partner have outgrown working from your dining room table, or you own a bustling coffee shop with lines that stretch out around the block, you are clearly ready to expand to a space or location that better fits your needs.

2. Your business requires a skill set that you don’t have

When you are just starting out, it is on you to handle all the details of managing your own business. Regardless of what type of business you run, product you create, or service you offer, you are also in charge of your own marketing, accounting, customer service, and more. As your business grows, you may find that you no longer have the skill set to take your small business to the next level. If your business is doing well enough that you have the budget to hire staff or outsource work to experts, then it might be a good time to expand.

If you think you can get more leverage from better social media marketing campaigns, then expand your staff to include someone to do just that. Or if you see a need in the market that you’d like to support, but don’t have the skill set for, bring on a new partner who does. It’s hard to let go of the reins, but bringing in an expert who can fill a need is a great way to expand your business.

3. You recognize the need to diversify

Let’s say that your business is going well, but you have noticed a plateau. You have a steady stream of customers, but they are the same customers coming in over and over. This is one sign you may need to diversify your product or service offerings in order to get in front of a new audience. That’s not to say that there is anything wrong with having repeat customers; the fact that you have loyal customers is great news for your growing business. But if you’ve hit the ceiling of how far you can grow your business with your current product and your current customers, then diversifying can be a great way to expand your business. You’ll have a steady cash flow from your existing products and services that can give you the financial stability and the confidence to branch out and try something new.

On the flip side, you may be offering dozens of products and services, but only one of them is profitable. You’ve got a golden egg, but you’re not sure if that is sustainable. Take a step back and consider how you might scale down or eliminate underperforming products and services. Also, take time to consider that another reason you might need to diversify is that you recognize that of all the services and products you are offering, only one of them is making your “golden egg” successful and think about how you might take what you’ve learned to create more successful products. Diversifying strategically can ensure you aren’t counting on just one thing to keep your business afloat.

4. Your business is in a good place financially

Maybe none of the above applies to you, but your small business is in a great place financially. You have a positive cash flow, your customer base is happy, and you are comfortable. That’s great! But that might also be the nudge you need to try something new. If your business is doing well, it could be an excellent opportunity to think about a new product you’ve been meaning to test out, or offer an additional service that could expand your customer reach. Take small steps to test out growth opportunities, knowing your business is financially sound.

When you are ready to expand your business, Sound Accounts can scale up our services to fit your needs. We support small businesses at every stage of growth. Contact us to find out more about how we can support your growing business.

For helpful info on expanding your business, check out our frequently asked questions and answers below.

FAQ’s

What are some signs that it’s time to expand my business?

If you have grown out of your workspace, are unable to keep up with product demand, or want to diversify your offerings, then it might be a good time to expand. If your business is in a financially healthy place and you want to grow, this is also a good sign that it is time to expand.

What are some things I should consider when I’m preparing to expand my business?

Some things you should consider are: Is my business financially stable? Is there a market for the product or service I want to expand to? Do I have a physical need to get into a bigger space? How will I define success as I expand my business?

What are some questions I should ask before I expand my business?

If you are thinking about expanding your business, here are some questions to ask yourself: Are you growing out of your current work space or business location? Are you unable to keep up with demand? Is there a skill set that you don’t have, one that could help your business grow? Do you want or need to diversify your products and services?

November 10, 2021