• How do I handle overdrafts or A Line of Credit in Profit First?

    | Categories: Business Coaching , Line of Credits , Overdrafts , Profit First , Profit First Cash Management System

    Blog by Fuel Accountants

    Banks love to get businesses to use Overdrafts and Lines of Credit.  Short of credit card lending, this is very lucrative for banks, but it traps business owners into easy debt that is hard to get out of. One of the commitments that you made when you started with Profit First was No New Debt!  Your next commitment was to get out of the debt that you already have (debt = jail).  Overdrafts and LOCs are debt in the same way that a mortgage is debt - actually, it’s worse debt! The problem with Overdrafts and LOCs is that you can (and…

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  • Will Interest Rates Be Going Down?

    | Categories: Interest , Tax

    Blog by Fuel Accountants

      Janet Yellin, our US Treasury Secretary, has once again delayed lowering interest rates. And with good reason. Inflation is still too high. And as I’m sure you know, lowering interest rates has an inflationary effect on the economy. The biggest problem I see is that the federal government continues to shovel billions of dollars into the economy, creating ever larger deficits, and contributing to the inflation rates. Although there is a lot of pressure to increase taxes on corporations and the wealthy, anyone doing the math on that will see that the additional revenues that would be generated will not cover the…

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  • Do You Hear Something Dripping?

    | Categories: Cash flow , Cash Management , Profit First , Revenue

    Blog by Fuel Accountants

        Ok, has this guy gone off his rocker? Now he’s asking me if I hear dripping? Yes, I am asking that.  But let me explain: We have run into situations where our clients have periods of high revenue, followed by periods of lower revenue. They are doing nothing wrong. It’s just that some businesses have a natural flow of revenue that roller coasters, depending on the calendar. We call that seasonality. And if that is the case with your business, then pay attention to this article!! Do you remember the story of the grasshopper and the ants? The grasshopper lived day-to-day, while the…

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  • Did you know that a Customer Complaint is a gift in disguise?

    | Categories: Customer service ,

    Blog by Fuel Accountants

      Seth Godin recently wrote an article challenging the assumption that a customer complaint is bad.  Oftentimes, when we get a customer complaint, we go into crisis mode. It might even feel like the end of the world has come!!  So slow down, take a deep breath (maybe 2 or 3 even) and open up your mind. How about looking at this as an opportunity for improvement? Did you know that the Chinese meaning of crisis also bears the meaning of opportunity? Now take a moment to reframe the situation. Ask yourself a couple of important questions: Is the complaint even valid or realistic? What might…

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  • What? Are You Blind?

    | Categories: Building Strategy , Business Growth , Business Tips

    Blog by Fuel Accountants

    No, I’m not making fun of you, nor am I disparaging the visually challenged. I am simply asking if you have a vision for your business. If you don't have one, you are flying blind.  Everyone needs a vision of where they are going. Why? Because if you don’t, where in the heck is your destination?  A vision statements needs to have certain elements in order to be clear and actionable: A revenue and profit target A time frame (we recommend 3-5 years) Clearly defined market segments A clearly defined product/service mix Is a vision important to strategic direction? DUH!! If you don't know where you want…

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  • How should I handle credit cards in Profit First?

    | Categories: Business Tips , Cash Management , Credit Card , Debt , Organized Financial System , Profit First

    Blog by Fuel Accountants

      Credit cards make paying for things pretty darn convenient. Sometimes a little too convenient. It’s important to manage your spending habits and remember that we are all in this FOR THE PROFIT. That’s right. Profit comes first, not last. One of the core principles of Profit Fist is that debt is bad. Credit card debt is the most common form of debt businesses have. So are we suggesting you burn your credit cards? Heavens no. It just means that we have to be deliberate about how they are used.  Credit cards can significantly help improve cash flow, earn reward points, and…

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  • How Can We Slow This Race Down?

    | Categories: Building Strategy , Business Growth , Business Tips

    Blog by Fuel Accountants

      Is it our imagination, or does everything seem to be speeding up? No, it’s not your imagination. It’s real. And the faster the pace, the more stuff comes hurling at us. The more stuff coming at us, the more decisions we must make.  And the more decisions we make, the greater the risk that we make a poor decision. So is there a way out of this conundrum? Let me share an experience to draw a comparison. I love to ride my motorcycle. A couple of years ago I thought it might be fun to try my riding skills on a race track. I…

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  • Want to get rid of all that pesky paper stuff?

    | Categories: Accounting system , Hubdoc , Xero

    Blog by Fuel Accountants

      Xero is a great accounting system. As Platinum Champion Partners we get to work with one of the top rated systems in the world. In this article I’d like to show you how you can FINALLY get rid of all that floating paper you have to deal with. Several years ago, Xero acquired a company called “Hubdoc.” Hubdoc is the system we use to make your info system paperless. Many of our clients are using it successfully and have become significantly more efficient as a result. Hubdoc is a document collection system that optically scans and stores your documents. And we use it…

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  • Direct Materials and Subcontractors, COGS or OPEX?

    | Categories: Business Tips , Cash Management , Contractors , Profit First

    Blog by Fuel Accountants

    Having a great relationship with your material vendors and subcontractors is critical, especially as your business transitions and grows over time. Making sure they are paid on time is an important part of maintaining those relationships. So we want to show you how to manage your cash flow using our Profit First Cash Management System (PFCMS). Direct Materials: When implementing Profit First , it is important to distinguish between materials used to produce your customer products or projects, and non-direct materials used more generally in your business. We treat the two differently for very important reasons. Direct materials expense always follows the volume…

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  • Check Your Assumptions…

    | Categories: Building Strategy , Business Tips , Operations

    Blog by Fuel Accountants

        How often does this happen? You’re running a process that you’ve successfully run a million times, but this time it fails. As kids, we were always told, when approaching a railroad crossing, to STOP, LOOK, and LISTEN. When evaluating the integrity of a process, we think you should do that as well… Under these circumstances, It’s easy to think the process no longer works, and must be changed. And it might be that you’re right. But did you thoroughly check your assumptions? When something either doesn’t work, or stops working, don’t make a hasty change without checking to make sure that a change…

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  • The Problem of TMI (Too Much Information)

    | Categories: Building Strategy , Business Tips , Operations , Sales

    Blog by Fuel Accountants

        How many times have you made a decision that seemed to make sense at the time, but in retrospect, turned out to be less than optimal? Many times, it is not your fault.  Leaders become trapped in a conflicting world. They get mountains of input from everywhere; news events, markets, customers, vendors, and even everyone inside the organization. Sometimes the information is incomplete. Sometimes it is not accurate. Sometimes it is complicated and difficult to understand. Sometimes it conflicts with other information. It is the leader’s job to sift through all this stuff and determine the direction of the organization. Small wonder…

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  • How to kill two birds with one stone Using Profit First to Achieve Your Strategic Objectives

    | Categories: Building Strategy , Business Tips , Profit First , Profit First Coaching

    Blog by Fuel Accountants

        Did you know we can kill two birds with one stone? Well, I’m about to tell you how!! One of THE biggest challenges facing small/medium businesses (SMB’s) centers around tactical cash flow management and achieving strategic objectives. How can you balance short term cash management with long term strategy? We do have a solution for that. It’s called our Profit First Cash Management System (PFCMS). When our clients (and us, too because we use this system in our business) employ Profit First, we can manage short term cash requirements, and at the same time, store cash to meet long term strategic goals. How do…

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  • The only thing worse than receiving negative feedback is receiving “constructive feedback…”

    | Categories: Business Tips , Customer service ,

    Blog by Fuel Accountants

        Whenever I’ve heard someone tell me they’d like to give me feedback on something, the antennas go up and I brace myself for some REALLY BAD NEWS… That’s how things usually roll in life, right? Who likes to hear that they’ve done terrible work, or botched a job? Yet, while giving difficult feedback can be difficult on our side, maybe it’s time to consider the effect of NOT giving that feedback. When an employee, customer or vendor goes sideways and messes up, or exhibits terrible behavior, an intervention is definitely warranted. Why not just let it slide? Because it sends an unintended…

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  • How’s Your EBITDA? Put on your Owner Hat for a minute

    | Categories: Small Business , Amortization , Business Tips , Depreciation , Interest , Tax

    Blog by Fuel Accountants

        I know, you wear lots of different hats every day. There is so much to get done, and there is not always someone specifically assigned to do it. That is the nature of a Small/Medium Business (SMB). But those little things all need to be done, so we constantly switch roles (or change hats) and make it happen. The problem is that SMB’s often are so busy changing hats, that they lose focus on the big picture. Are you so busy flying the plane that you forget about the destination? Alright, so slow down for a minute here, Turbo, and put on your…

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  • Have you started using the Profit First Cash Management System yet?

    | Categories: Building Strategy , Cash Management , Future Financial Planning , Profit First

    Blog by Fuel Accountants

      What are you waiting for? For those of you not yet familiar with our Profit First Cash Management System (PFCMS), it gives you the opportunity of taking charge of your cash and profitability.  We use Profit First in our practice, and many of our clients use it as well. It works amazingly great… If you’re not yet using it, call us to get more info. It involves setting up several bank accounts where your revenue is apportioned into on a consistent basis in order to make certain that you have the right amount of cash, in the right place, at the right time. When…

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  • How do you win an Infinite Game?

    | Categories: Building Strategy , Business Tips , Operations

    Blog by Fuel Accountants

      What kind of question is that, and why am I asking it? Well, why don’t you ask yourself if your business is a finite, or infinite enterprise? Sure, your business had a beginning. It might also have rules (processes), timelines, and score keeping (the numbers). But when does it end? What does the end even look like?  This is an important concept to consider for several reasons: Even if you have a business plan with 1 year or 3-year goals, once you reach the goal, now what?  Is it possible to create our own future? While it’s impossible to predict the future, is it possible…

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  • Have You Heard the Bad News? Half of Everything you spend on advertising is a waste!!

    | Categories: Business Growth , Business Tips , Marketing

    Blog by Fuel Accountants

        Oh great. So now what should you do? Well, I guess you could cross your fingers and spend more money. Or, you could try to guess which half is a waste, and eliminate it.  The main problem is one of measurement (or lack of measurement). There are tons of marketing geeks out there that want to take your money and promise thousands of views and clicks.  The problem with Marketing Geeks: While there are a few competent folk out there, many of the marketing geeks have read “Online Marketing for Dummies” and now consider themselves experts in the field. Very few have demonstrable…

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  • How many bank accounts do I really need?

    | Categories: Business Coaching , Cash Management , Profit First

    Blog by Fuel Accountants

    Wait What? Am I telling you that you need more than one bank account? Yes, I am!! Remember how our grandparents did finances? The paycheck got cashed, and the money came home and was put into separate envelopes: Rent, Food, Clothing, etc. Well, this same idea can be employed in your business. We help our clients set this up into what we call our Profit First Cash Management System (PFCMS). As money comes in, it gets allocated to various business accounts. The point is to have the right amount of cash in the right place, at the right time. In the basic system…

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  • What the heck is a Sales Funnel?

    | Categories: Business Coaching , Business Tips , Future Financial Planning , KPIs , Sales

    Blog by Fuel Accountants

      Funnel cakes, funnel clouds, sales funnels, there are funnels all around us… You’ve probably been hearing this term used a lot lately, along with a sales pipeline. There are many confusing definitions surrounding this area. A sales funnel and a sales pipeline are really two things describing one thing: So let’s land the plane here and make it simple.  A funnel in real life is a mechanism consisting of a wide open top with an open narrow open bottom. It is a concentrating device that takes in a lot at the wide top, but only allows a small amount to come out at…

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  • What’s the outlook for 2024?

    | Categories: Business Tips , economic forecast , Future Financial Planning , inflation

    Blog by Fuel Accountants

      We have for you, the good, the bad, and the ugly (the good is at the end so you leave on a positive note!!) We’ve been through so much turmoil in the last 3 years.  So what is the forecast for this year?  While we don’t have a crystal ball, here are Peter’s predictions for 2024: Inflation is going to continue to be a problem:  Wage growth is going to continue - probably stronger than in the past few years as the population continues to struggle with the ravages of increases in the cost of basics such as food and housing.  Inflation…

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