Make your business more profitable
Making a profit isn’t something that happens overnight – to create a good return from your business you need a clear focus and a well thought-out strategy for increasing profitability.
This means reviewing your business model and looking at every area of the business, to see where you can cut costs, increase margins and maximise revenue.
Focus on your key drivers
Having surplus cash at the end of the year allows you to invest back into the business, fund your growth plans and increase the size of your own dividends and drawings as the owner.
To achieve these profits, it is important to focus on the key financial drivers in your business.
To drive profits:
- Boost sales – the more sales you make, the bigger your net revenue, so investing in marketing, sales activity and business development will be key to a better bottom line.
- Increase prices – by setting a higher price point, and keeping your ‘cost of goods sold’ number low, you create a larger profit margin on each sale – upping your profitability.
- Cut costs – operational costs and overheads eat into your potential profits. So spend management and cost reduction are vital to creating a more profitable model.
- Reduce taxes – tax liabilities will be one of your biggest costs, so sensible tax planning and use of tax reliefs will help to reduce your taxes and ramp up your end profit.
Talk to us about boosting your profits
If your business goal is to increase profitability, we will help you review your business model, identify your key financial drivers and proactively drive your profit performance.
Get in touch and let’s start boosting your profits.
What do you need to do to get ready for the New Financial Year?
For many the 31st of March feels like a huge milestone on the calendar. It can be a busy and frenetic time, and can feel even more stressful for business owners. Add to that Easter and it feels overwhelming! However the end of financial year process need not be a painful one! Read on to find out how.
A recent US study found 69% of adults attribute their stress to “money-related” issues and, as the End of the Financial Year (EOFY) draws near, it is typical for thoughts of money and dreaded taxes to dominate our mental space and drive us to despair.
To help take some of the pressure off GoFi8ure has prepared some simple steps for you to follow in your accounting software so that EOFY feels more manageable:
Step 1: Gather your paperwork aka “source documents”
The more information/paperwork you give to your Accountant, the less time they need to spend chasing you (which costs time and money).
Go through your files and emails and collate your source documents (Statements, Invoices, Receipts etc) for your accounts.
Paperwork includes at a minimum bank, credit card, loan statements as at the 31.3.2019, copies of all fixed asset invoices purchased during the last financial year, GST work papers and returns/receipts to IR, year to date payroll records, ACC invoices, insurances and premiums, legal, repairs and maintenance, lease expenses, finance agreements, use of home office, out of pocket expenses and year to date personal tax information if you are a shareholder. Depending on the complexity of your accounts you may need to provide more examples of source documents. Your Accountant will ask for these so be prepared.
Tip: Use Xero’s File Library to upload all of your paperwork/source documents as PDFs. It is really easy to do and your Accountant will love you for it.
- On the top left hand side click on the company name
- Click on the Files option
- Create a new folder called EOFY2019
- Label each file with a clear name. For example: 00 Savings Bank Statement 31.3.2019 or ACC Levy Invoice etc
- Upload labelled files into the electronic folder – it is that easy! This will keep everything your Accountant needs in one easy to view/access location in the cloud
Step 2: Complete a Stock Take / Stock Valuation
If you are carrying stock, you are required to do a stock take to record how much and the “value” you have on hand as at the 31st of March 2019. The figures should be at cost, excluding GST. It is important when you are dealing with stock that you use the best tools available. Whatever tracking system you use, make sure you have the right software to support it. If you are currently using Excel spreadsheets to manage your inventory, you may want to consider moving to a cloud based inventory system like Unleashed.
An effective, easy-to-use inventory system eliminates human error that can occur whilst using Excel. Inventory software gives you real-time inventory control and reporting. It also helps you to understand your product margins and provides you with important information to help you make better decisions based on real-time, accurate profit reporting.
Step 3: Round up those overdue invoices and debt collect
Review your Aged Receivables detail report and identify all invoices that are 30+ days overdue. Once this has been done make one final determined effort to collect the debt before the 31st of March. If you have exhausted all avenues for collecting unpaid invoices and do not envisage collecting them at any point in the future, you can write off the outstanding invoices to a bad debt expense. Contact us to find out how.
Tip: If you are going to write off any outstanding invoices; make sure to apply a credit note against the invoice owing. We do not recommend using the “void” option in your accounting software.
Step 4: Review Creditors entered and reconcile to Supplier Statements
Do you have outstanding supplier invoices showing on your ledger? Are you confident that these are correct? GoFi8ure recommends that you reconcile all creditors to supplier statements and balances before the 31st of March to ensure any missing invoices are received and entered into Xero. You may find that some suppliers have in fact been paid, however, the payment was not allocated against the supplier invoice. If this has happened it is important to correct it soon as possible.
Need help actioning a creditors reconciliation? Send us a message so we can help.
Tip: If you are disputing an account or are no longer paying an invoice then you should apply to the supplier for a credit note and once received reconcile the credit note to the invoice in your ledger (creditors reconciliation). If you would like accounting support please contact us.
Now is the time to make the conscious decision to take action with steps 1-4. If you would like GoFi8ure to take your end of year stress away and do these steps for you, get in touch with us today via email or call us on 0800 463 488 and quote End of Financial Year Help.
Women in Business on Fire
Lisa’s key messages are that when goal setting there are always further goals to achieve and that self-actualization is important to try and achieve. On digital disruption within the accounting industry, she is riding the way with her firm offering innovative products. Lisa understands the reason why for her business as well as the importance of goal setting! What goals are you setting for your business? We can help! please a comment and we will be in touch! #communityovercompetition
The key function of a Director is to maximise shareholder value. How much time are you dedicating to working ON your business? And, who is holding you accountable to fulfilling this role effectively?
Most business owners know that every member of their team needs a Job Description, which should include:
- Clearly outlined responsibilities and tasks
- Some specific and measurable KPIs (Key Performance Indicators)
- A set of clear expectations around core competencies and behaviour
When a Job Description is clearly documented, it’s much easier to monitor and measure performance. However, as logical as this seems, many business owners fail to do this for their own role as Director of the business.
So, as Director, what should be in your Job Description?
The most important function of a Director is to maximise shareholder value. This means carrying out activities that drive up returns and business value; by working smarter, not harder.
Your key responsibilities include setting the vision and strategy, managing and mitigating risks, growing the business, establishing the right business structure and holding the CEO (who may also be a Director) to account.
How much time are you dedicating to working ON your business?
To give a general indication… as Director, you should spend an hour or two every week working ON the business. In addition to that, every quarter you should dedicate half a day to ongoing strategy planning and take one to two days every year for an annual off-site planning session or retreat. This is to remove yourself from day to day distractions to do some serious ‘blue sky thinking’.
As Director, you still need accountability.
Appoint someone independent to ensure you adopt best practice as a Director. There are several ways to get accountability. You could establish a quarterly advisory board (with an independent chairperson). Or, you could engage an experienced facilitator to coach you regularly to ensure you’re meeting your objectives. Having an independent accountability process in place will ensure better planning, better decision making and faster progress.
Remember, you’re not exempt from meeting the requirements of your Director role. Like every other role in your business, you need a Job Description for your role as Director, and it should have clear responsibilities and tasks with KPIs so that you can monitor and improve performance.
So, if you do not already have a Job Description, set that as an important task, with a due date, and start thinking about who will hold you accountable.
Setting goals and measuring performance
Goals are what drive the long-term performance of your business.
Agreeing on clear targets, and measuring your progress over time via key performance indicators (KPIs), helps you to understand exactly where the business is going.
But how does this kind of performance management work in practice?
Track your performance with KPIs
Tracking your goals via KPIs show you where the company is hitting the mark and (importantly) where you need to do better – putting real drive and motivation behind your overall strategy.
To make performance management drive your profits and productivity:
- Set targets and work to a long-term strategy – define your key goals for sales, profit, growth and cashflow etc. And ensure these target are closely aligned to your wider strategic business plan – so you’re tracking the metrics that matter.
- Track performance with real-time information – integrate a KPI reporting app with your accounting software, and monitor the key financial and non-financial metrics. Use this dashboard to regularly track your KPIs – giving you a current view of performance.
- Motivate your team to be more productive – explain your key targets to the wider team, and keep them engaged in meeting these goals. Motivation and engagement levels are higher when staff can see what they’re working towards.
Talk to us about setting up a KPI dashboard
If your are looking to track, monitor and boost your business performance, we can help. We’ll help you choose the right KPI reporting app, and get you in control of your key metrics.
Get in touch to start boosting your performance.
GoFi8ure able to help with Xero training for the New Financial Year
It is generally accepted that preparation for the financial year can start from as early as February, to as late as July or August. Getting a head start can help businesses avoid rushing and making miscalculations.
The end of a financial year is a great time to take a look at business from a broad perspective, and see what worked and what didn’t. Companies have the chance to do activities such as segmenting expenditures and revenues into separate groups. Reviewing tax returns and other related processes is also a great step toward getting prepared for the new financial year.
Creating a calendar is also a common tactic to help businesses flourish instead of flounder at critical turning points. This includes creating deadlines, and sorting tasks by their priority. Such tasks could include creating a system for dealing with batch emails, creating templates for sending replies or inquiries, and delegating bank processes to automated accounting software.
Another great practice is to settle the cash flow system early. As one of the most important facets of a business, keeping a healthy cash flow is important, in order to avoid funds bottlenecking at a time a company needs them the most. Xero training can help a company’s employees track and manage their cash flow better.
Budget checks are another important stage for monitoring business’ finances. After designing a cash flow stream, companies need to allocate their resources intelligently. Creating a budget plan for the business will ensure that a lot of important sectors of the business are covered.
Technology is ever-changing, and a good business should stay up-to-date. Budget plans usually include spending for good software and new technologies, like digitising their transactions and accounting processes. It could also be used to purchase new hardware for accounting software – investing in this is a big help to companies in taking their business to the next level.
Let GoFi8ure help you set up new processes like Xero training to get ahead! Visit our website at https://gofi8ure.co.nz/ and find out how!
Meet New Zealand’s Latest Xero Platinum Partner, GoFi8ure
September has certainly been kind to GoFi8ure, a leading accounting, tax return, and bookkeeping service in New Zealand. GoFi8ure started the month by snagging accounting software company Xero’s coveted Bookkeeper of the Year award. More than the award, the company made history by becoming the first bookkeeping practice in New Zealand to become certified as a Xero platinum partner.
GoFi8ure attributes this success to a journey 9 years in the making. The company put their trust in Xero, and this opened up fresh opportunities and innovative solutions, becoming a highly beneficial partnership. 9 years of hard work later, and the company has finally gained recognition for its stellar performance through the opportunities the certification will bring.
Xero isn’t your average, run-of-the-mill accounting software developer. Largely based in New Zealand, it has since grown to serve clients across the regions of Australia, the UK, the UK, Canada, Asia, and South Africa. Key features of the software include auto bank and credit account feeds that can be sourced through the cloud.
The Xero partner program provides big boons to companies through its many extra features as well as the addition of fresh clients. Xero has grown to become the preferred bookkeeping solution by many industries and companies; as more and more companies started using Xero, GoFi8ure realized the importance of polishing and optimizing their Xero training. As a result, the company has reaped the benefits of Platinum accreditation.
GoFi8ure attributes their success to customer interactions that have been more proactive than reactive. Their accountant training has always been geared toward understanding the clients’ need first and foremost and working their way towards their satisfaction. After all, an accountant that’s passionate about helping clients is good for everyone.
GoFi8ure still possesses the same passion toward helping businesses perform and achieve impressive financial results. For inquiries about working together, or simple curiosity about Xero, drop by https://gofi8ure.co.nz/ now!
GoFi8ure announced as New Zealand’s first Bookkeeping company to become a Xero Platinum Partner
What an amazing month September has turned out to be! Not only did we win the prestigious award for Xero’s NZ Bookkeeper of the Year, just earlier this week we became New Zealand’s first Bookkeeping practice to become a Platinum Xero Partner. How amazing is that!
We started our journey and partnership with Xero over 7 years ago and it was the best decision for our business. It opened up doors to provide more opportunities and solutions for our clients. Fast forward 7 years and we did it! We made it to our goal – which was reaching the PLATINUM Partner status.
Gone are the days of Accounting practices only talking to their clients once a year, and gone are the days of Accountants being reactive vs proactive. Business owners need an Accountant who will take the time to understand you and your business. GoFi8ure is changing the way Accountants work with their clients for the better. We call this change the LEAR approach. LEAR stands for Listen, Educate, Advise, and Resolve.
Listen – We actively listen to you. We listen to your concerns, frustrations and worries. We also listen to your ideas, your goals and your dreams.
Educate – Not everyone went into business because they were great at numbers or with money. We educate and provide information, tips and tools for our clients so they are enabled in their business.
Ask– We ask questions. They may not always be the questions you want to answer but we ask the questions that need to be asked. We want to know everything about our clients and their businesses and the best way we can do this is to ask.
Resolve – Our team of experienced Accountants and Bookkeepers work together to provide you with a solution specifically designed for your situation. You are not in this alone and you should not feel like you are. The right Accountant will work alongside you and support you each step of the way.
If you would like to improve your business performance and financial results but do not currently feel supported by your current Accountant to achieve this, please get in touch.
Why put off until tomorrow what you can achieve today!
Interested in knowing more about our advisory services? You can check out our Xero Advisor profile by clicking here.
For the third year in a row, mobile Accountants and Bookkeepers GoFi8ure attended the Xerocon Conference and Awards in Brisbane and were named as Xero’s Bookkeeping Partner of the Year for New Zealand, on account of their effective and innovative use of Xero while providing bookkeeping services.
“Words cannot describe how honoured and grateful we are,” said the Accountant and Bookkeeper in a blog post last week, giving their thanks to Xero for recognising the growth and change that GoFi8ure has seen over the last 36 months. They also congratulated the other finalists for the award, Julie Russell Bookkeeping and Katalyst Cloud Business Services, and praised their achievements over the last few years.
In their blog post, GoFi8ure also attributed their success in this category at the Xero Awards to the business’ core values, which they say have been integrated throughout their businesses and services on a day-to-day basis. Values such as responsibility and accountability for completing every task given to them by clients, integrity in honouring professional commitments, and efficiency and effectiveness in their approach to every job, have all been a crucial part of their business and its success over the last three years, according to GoFi8ure.
GoFi8ure use Xero extensively as a tool and platform to provide SME business owners, sole traders, contractors and non-profit organisations with a one-stop accounting solution, and generate every tax return and financial statement their clients need. GoFi8ure’s services even include one-on-one Xero and bookkeeping training sessions, with their own tailor-made training programme that utilizes a 12-step ‘best bookkeeping’ checklist.
GoFi8ure have a team of 16 qualified accountants and bookkeepers across their branches in the Wellington CBD, Upper Hutt, Auckland and Dunedin, allowing them to offer services to businesses from all over the country. Anyone wanting to learn just how GoFi8ure can help their business can visit them online at gofi8ure.co.nz, or call 0800 463 488 to get in touch directly.