Most entrepreneurs would agree that owning a business is an incredible privilege, and they would likely never want to go back to working for someone else. However, we all have our days! Sometimes, those rough days can turn into weeks.

With 17 million new entrepreneurs predicted to enter the small business economy in 2022, we thought now would be a great time to ensure you’ve got the tools to weather the days that challenge your entrepreneurial passion. Here are our tips to rekindle that spark. 

Customer Reviews

If you read customer reviews with one eye closed, it’s time to reframe your perspective. Whether positive or constructive, customer feedback is an asset you want to harvest as much as possible. Since it’s easy to fall victim to impostor syndrome as an entrepreneur, positive feedback can help you gain perspective from a credible source about your performance.

No review is a negative review; any feedback left by a customer will help you succeed moving forward. Constructive reviews can help you pivot to success and provide better customer service in the future. Even a nasty review serves a purpose: you now know that this personality is not your target client, and you can shift your marketing and sales efforts in a more positive direction.

One of the best ways to garner customer reviews is via a Net Promoter Score survey, or NPS. The super-short survey was invented by Fred Reichheld, a partner at Bain & Company, during his search for the best one-question indicator of customer lifetime value. Customers are asked, on a scale of 0 to 10, how likely they are to recommend your services to another individual. Depending on their results, they fall into one of three categories: promoter (if they score 9 or above), passive (if they score 7 to 8), or detractor (if they score a 6 or lower). The feedback they leave in their follow-up question, “What is the primary reason for your score?” will tell you where your strengths and opportunities for improvement are.

Your overall NPS is calculated as follows: NPS = (% of Promoters) – (% of Detractors). Wondering where you fall among competitors? The average score across all industries is +32, and you can find more information about your specific industry here. If your customers aren’t leaving reviews online, it’s time to ask for them, and a Net Promoter Score survey is a great place to start. Follow up with your Promoters and ask them to leave a review on Google or Yelp.

Personal Self-Care  

Make sure to allocate enough time for personal care. No one can work 24/7 and survive without burning out. Self-care can look like a yoga class or an indulgent spa day, but it’s what we do week to week and day to day that matters most. Surprisingly radical steps toward self-care can include:

  • Working toward a daily lunch break that’s at least 30 minutes long.
  • Turning off email notifications after hours.
  • Outsourcing household chores during a busy week 

Make self-care a regular habit, and you’ll be better balanced when you go to work.

Goal Reset

If you’ve been skirting by the last few years on incremental or unchallenging goals, it might be time to give yourself a BHAG – that is, a Big Hairy Audacious Goal – as outlined in the book Built to Last. A BHAG is an ambitious, long-term goal that can help propel your entire company past the hamster wheel toward a mission for a better future.

If you feel your employees could use some rejuvenation, too, schedule an empowering goal-setting retreat for the entire company to help team members feel heard, valued, and motivated. 

Education

As an entrepreneur, you’ll never stop learning. New skills are required every time you reach a new level in your business. Changes in technology, science, and government compliance trickle down to small businesses, requiring changes to your business processes constantly.

Take a new class or read a book to learn something that will improve your business. If you’re short on time or low on capital to invest in expensive education courses, try starting with Coursera for go-at-your-own pace education or downloading a business book like Built to Last or The Four Disciplines of Execution on Audible.com. You’ll be full of ideas that you can implement to make your business better.

Delegation

We all have tasks that we love to do and those we would love not to do. If you’re spending too much time on the tasks that don’t fulfill or inspire you, it’s time for a change! If you have a team, delegate the things you don’t love – and find employees that really love to do them. Not in a position to bring on more personnel? Augmented Intelligence can add automation to any process, from converting prospects to customers, completing daily bookkeeping tasks, and more.

New Project

Is there a project that you’d love to pursue but has been on the back burner forever? Making it a priority may just be the reset button you need. Oftentimes, urgent but less important tasks take priority over things that are also important but less urgent. Carving out time each week to progress an important “back burner” project can be a great way to commit to your priorities and suppress the tyranny of the urgent.

Vacation

Last but not least, while it might sound terrifying and counterproductive, it may be time to take a good old-fashioned vacation. Especially after two years of working remotely, you might benefit from some time looking at four different walls. 

If the idea of taking a step away from your business for a few days sounds scary, consider starting with something small, like a weekend getaway. Alternatively, for longer trips, you could allow yourself 1-2 hours each day to progress the things in your business that keep nagging at the back of your mind.

Remember, the only way to find out what works for you and nourishes your entrepreneurial spirit is to experiment! Try to implement any of the tips above before you reach burnout, especially if you’ve been working hard and it’s been grinding you down lately. You deserve time to relax, refresh, and rejuvenate your passion for your business.

The Four Ds for Efficiency

Time is our most precious personal resource; once it’s spent, we can never recover it. As busy entrepreneurs, we seem to have less time than anyone else, so it just makes sense to look for ways to use our time wisely. We’d like to introduce you to a technique called the Four D’s that has worked for many.

The Four D’s

When you think about it, there are only four types of actions you can take against any one task:

  1. Do it.
  2. Delegate it.
  3. Delay it.
  4. Delete it.

As you approach each task on your to-do list, ask yourself which one of the four D’s is best.

Do It

The first option is simply to do the task yourself. Get it done, checked off, and out of the way.  This is often the best option if it’s urgent, important, or you are the only one with the experience and training to do it.

While this might sound counterintuitive at first, simply doing a task might not be the best option. Let’s look at the other three options before we decide.

Delegate It

If your to-do list is full of simple, routine actions, then delegating is a strong choice. Delegating is also great for tasks that are beyond your expertise and would require too much learning to accomplish sufficiently. If you don’t have time to do everything yourself, then getting help is a smart alternative to doing it yourself.

Getting help doesn’t mean you have to hire a full- or part-time employee. You can get help in a multitude of other ways:

  • Engage a company to do a task. From walking your dog to managing Google Ad campaigns to handling your bookkeeping and taxes, there are service-based companies that can take over a task permanently or on a short-term basis to alleviate some of your workload.
  • Automation is a form of delegation. Can software do what you are doing?
  • Find help on platforms like Fiverr.com or UpWork. Whether it’s a five-minute or a five-day task, you can find a freelancer to help with your project. 

If you can write instructions about how to perform the task, you can delegate it. And if you’re worried about losing control or quality, simply add milestones where you check the person’s work. Initially, it might not be faster, but in the long term, it will pay off.

Delay It

If a task is not urgent or important, delaying it might be the right option. But the problem with this strategy is that it requires you to handle the task at least twice: once when reviewing it and deciding whether to do it, and again when you finally decide to do it. If you repeatedly decide to delay it, you’ve taken up precious time and mental energy that could be better spent. 

So, when exactly is the best time to delay a task? Consider delaying when any of the following apply:

  • It’s not urgent and you have other urgent items to attend to.
  • It’s less important than other items you must attend to.
  • It’s less profitable than other items you must attend to.
  • The task is best accomplished in batches. As an example, rather than answer each email as it comes in, think about blocking out a couple times a day where you check and clear your email. You can apply this time-batching concept to just about everything to gain efficiency: posting on social media (write and schedule a month’s worth in advance), returning phone calls, attending meetings (book them all on one day and keep other days clear), and running errands (delay until you have three to four errands, then do them all in one run.

Be careful of delaying a task over and over again.  Something else may be going on with your mindset:

  • The task may be uncomfortable for you (find someone that loves to do what you don’t and delegate), or
  • The way to get started is ambiguous (schedule some training or find someone experienced to shorten your learning curve).

Delete It

Some tasks should never be added to your to-do-list in the first place. When there is no return on investment for a task, perhaps the best choice is to delete it.

Take a look at some of the things you do out of habit. Does it still make sense to do that task, or is it simply done because it was always done that way?

14 Solutions for Controlling Labor Costs

While the cost of labor is a significant expense for many business models, for those that are service-based, labor cost is the largest expense incurred in business operations. Controlling labor costs so that they stay in line with what’s best for the organization is an important management function. We outline a few ways you can control (or reduce) labor costs in your business.

  1. Encourage employee retention.

If a well-trained employee leaves, their institutional knowledge of your business leaves with them. The process of replacing them results in a temporary hit to productivity across the board: you must spend hours recruiting, hiring, and then onboarding a new employee, and they’re likely to need training and experience to get up to speed. Some turnover can actually be good, but if it’s too high (which is the case for many in the era of the Great Resignation), it can result in increased labor costs. 

  1. Automate tasks.

Save labor by automating any tasks that have the capacity to be automated. While a few automations could require extensive capital outlays, many systems can be implemented that are not costly and have an immediate return on investment. Your QuickBooks file is a great place to start. Integrations of native software and feeding of transactions are just two examples.

  1. Streamline processes.

Are you operating your business most efficiently? Or are employees still performing tasks that are outdated, nearly irrelevant, or unnecessarily redundant?

A great place to start when searching for inefficiencies in your company is the interface between departments. Is your sales team duplicating some marketing team efforts? Is customer service answering the same question repeatedly without communicating to operations how it should be permanently fixed?  Enhancing communications among employees throughout the company can increase visibility and cut down on labor costs.

  1. Train employees.

There’s only one way to ensure employees are doing what they should be, and that’s to spend time training them. Many of the technologies you likely use have created training modules and certifications that employees can partake in for free. If your team frequently uses systems and other tools, consider enrolling them in training courses.

  1. Provide the right tools for the job.

Do employees have the tools they need to execute deliverables effectively? Keep an open dialogue going about what is and isn’t working in the context of internal processes and technologies. Many times, employees will continue performing a task inefficiently because they either don’t realize a bug in the software can be fixed, they don’t have time to stop and troubleshoot a program, or don’t realize there’s a more efficient way to complete the job. Opening communication around the subject can lead to innovation and improved morale.

  1. Cross-train employees.

If an employee is out sick, does a customer’s job remain stagnant until your employee returns to work? Check to see if your employees can easily pick up another’s work in the case one employee is out. If they can’t, create an opportunity for cross training once they return. A recorded training session (with a screenshare when necessary) is a great way to train team members, and saving the recording to the customer’s file means that in the future, anyone who needs to can step in and complete the job with relative ease.

  1. Optimize employee schedules.

In many industries such as restaurant and retail, employee scheduling can be the difference between profit and loss. Software can help you determine how many employees you need and at what time. Ensuring employees know when to come in and what to focus on when they do will go a long way toward productivity. In some cases, a shorter workweek is a possibility that can drive lower labor costs, as is leveraging employees’ individual “magic hours,” or the times of day they’re personally most productive.

  1. Outsource.

Outsourcing may be cheaper than using employees on certain tasks, especially those requiring specialized knowledge or skills. Outsourcing can also help you determine how long a task will take, which allows you to plan better in the event you decide to take the activity in house once again. 

  1. Review compensation.

Compare your company’s current salaries to the going market rate for salaries in your industry.  Are your salaries in line? Adjust accordingly for future hires.

You can also consider different pay structures, such as commission-based, to better match performance to labor costs. It’s also important to consider compensation in the context of employee retention; while bonuses paid out in lieu of annual raises could allow you better management of accumulated pay raises for long-term employees, your team may value receiving a raise over a bonus.

  1. Review benefits.

Benefit packages are a great way to encourage employee retention, but they can become costly. If reducing costs in this area is a necessity, consider reviewing time off policies, shopping for new health insurance rates annually, or reevaluating employer’s percentage share of 401(k) plan contributions. 

  1. Review overtime pay.

There are two sides to overtime. On the one hand, some overtime pay can help you avoid the cost of hiring a headcount you either don’t need permanently or don’t need full-time. On the other, if overtime pay is so high that you’ve considered adding additional personnel, then your overtime pay is too high. We can help you evaluate when it’s time to hire.

  1. Provide remote work options.

Studies show remote workers are more productive. Plus, overhead expenses such as rent, furniture, and utilities will plummet, saving expenses overall.

  1. Hire smart in the first place.

The saying is “hire slow, fire fast.” Finding the right worker for your business is an art form. Interview, test, check background and references, and put employees on a 90-day trial basis to be sure you have the best workers.

  1. Understand the accounting side of labor costs.

If you pay an employee $15 per hour, understand that your labor cost is far more than $15. Not included in that $15 is:

  • Employer’s share of payroll taxes (Social Security and Medicare)
  • Vacation and time off
  • Paid holidays
  • Workers compensation insurance
  • Unemployment insurance (federal and state)
  • Health care
  • 401(k) matches
  • Company-sponsored events, like holiday parties, team building experiences, educational conferences, or planning retreats

There are also infrastructure-related costs associated with retaining an employee, such as:

  • Computer equipment and software subscriptions
  • Rent, utilities, furniture, parking spaces, building repair
  • Employer-paid meals, snacks, and coffee
  • Meeting time and expenses 

If you’d like us to help you calculate your labor costs per employee hour, please reach out.

Employees make your business possible, but to maintain a business profit, labor costs must be frequently reviewed. Follow the suggestions above to keep your team productive and your labor costs in shape.

The Critical Link Between Time Tracking and Labor Costs

Keeping track of how you and your workers spend time is one of the most important things you can do in your business. Labor costs can be a large portion of expenses, and understanding how time is spent can help you manage your business better in a multitude of ways. We touched on labor costs in our recent article, “Breaking Down Direct and Indirect Costs,” and wanted to share more on the topic. Keep reading to learn more. 

Benefits of Time Tracking

There are plenty of reasons to track time, some of which we’ve listed below:

  • When pricing by the hour, time tracking is mandatory; without it, you won’t be able to invoice your clients accurately.
  • Documenting time spent on specific projects helps managers understand how long a task should take, when employees could benefit from training, and where processes and procedures may need improving.
  • Project management systems allow users to import detailed time reports, which allows businesses to create more accurate fixed-fee pricing estimates on future jobs and customer proposals.
  • For construction companies, time tracking feeds into job costing.
  • For manufacturing businesses, time tracking feeds into labor reports.
  • For hourly workers, time tracking is used in payroll systems so they can be paid accurately.
  • Time tracking can increase accountability among team members as they become more aware of how they spend their working time.
  • When time is budgeted in advance, actual hours worked can be compared to see how the budget is used and whether it was too much or too little.
  • Time tracking allows managers and business owners to determine when they need to hire additional staff because the backlog has become too large.

What Is Time Tracking?

Time tracking is the recording of how you spend your time. You can use paper, a spreadsheet, or time tracking software like QuickBooks Time (formerly TSheets) to log the task you are working on and the length of time you worked on it. For example, here’s a simplistic example of a spreadsheet time log, aka timesheet, for one day:

Employees may be required to complete timesheets on a daily or weekly basis, which are then turned into their managers and payroll administrators.

Managers can take time tracking to the next level by adding hourly payroll costs as well as the employee’s hourly billing rate to gain insight into further time-tracking financial metrics.

Time Tracking Software

There are many different types of time-tracking software:

  • A time clock allows employees to “punch in” when they arrive for work and “punch out” when they leave. This type of machine is mostly used for payroll in a manufacturing setting.
  • Time tracking applications like QuickBooks Time allow workers with computers and smartphones to enter their time via the application. Features like biometric time clocks (i.e., requiring a thumbprint to verify the correct individual is clocking in) and geofencing (allowing employees to only clock in from certain locations) can reduce employee time theft.
  • Some companies will have their time tracking function embedded into their project management, job costing, or billing system. Employees would then enter their time via those applications.

Getting Employees on Board with Time Tracking

Reporting your hours in a time-tracking system is one of the least favorite tasks of employees and requires managers to spend more time shaping their mindsets and attitudes than any software training. It’s important that employees feel that your policies don’t resemble “Big Brother” when using their time data.

For best results, let employees know how the timesheet data will be used. Allay their fears that they will not get fired or in trouble if they feel something “took too long,” which can often translate into an employee “fudging” their hours on a task where they might have made a mistake. Make sure they know they won’t be penalized in any way for what they report. In other words, remove the risk of penalty for recording their time data accurately.

Communication is key in getting employees to report their time accurately so that managers and owners can receive meaningful information. Have managers tie time tracking to an employee’s personal career goals to increase adoption and reduce resistance.

Personal Time Tracking

Time is our most precious commodity, and tracking your personal time can give you insights into how you are investing in yourself. Some really interesting questions can be considered when you have some time data for yourself.

  • How much “downtime” do you need each day in order to live a productive and healthy life?
  • How much time are you spending on your goals?
  • Are you spending time on what you consider to be important?

Getting Started with Time Tracking

If you’re considering time tracking or would like to take your current time-tracking function to the next level, please contact us [here]. We may be able to help with integration, implementation, the accounting aspect of time-tracking, and financial metrics and reports.

 

We’ve heard more than a few horror stories in the past few months of business owners falling for phishing scams that compromise their company, cost them thousands of dollars, and put their customers and contacts at risk. Hackers are getting more sophisticated by the day, and it’s becoming harder to tell a malicious threat from an ordinary email.

We share this insight to empower, not scare. The good news is that most threats are avoidable with a vigilant eye. In 2021, think of a phisher as more of a vampire than a heister: you have to invite them in before they can cause any harm. Below, we’ve pinpointed a few common threats for 2021 and 2022, along with best ways to avoid them. These suggestions should help keep your sensitive data secure from current phishing trends. 

Common Threat 1: QuickBooks Impersonation

One common trend we’re seeing involves solicitations from QuickBooksⓇ impersonators falsely notifying you that your QuickBooksⓇ file is corrupt, your automatic payment is about to expire, or your version of QuickBooksⓇ needs to be updated. These phishers will try to get you to pay for a phony upgrade over the phone or grant them access to your desktop to “fix” your accounting software. Here’s the thing: if you work with an accounting company like New Business Directions, we’ll probably be the first ones to know if something is wrong with your QuickBooksⓇ file. And if you’re a New Business Directions customer, QuickBooksⓇ knows you’re working with a QuickBooksⓇ Solution Provider and will often notify us of any issues your account may be experiencing, too.

How to dodge the threat: If an email appears to come from QuickBooksⓇ, check the email addresses for the correct website. If it doesn’t end in “@Intuit.com” or “@QuickBooks.com” the sender is fraudulent (even if the name before the @ symbol looks convincing). Always contact your accountant before engaging with a solicitation like this and never provide payment information or authorize remote access to your computer or QuickBooksⓇ file to anyone besides your accountant or IT solutions provider.

Common Threat 2: Download this Attachment

Another major threat to watch out for involves an email from an address you recognize (say, a customer, vendor, or team member), but asks you to enter your Microsoft credentials to view the attachment. This scam comes from a person you know, and their email address matches the one you have on file. The MicrosoftⓇ log-in screen looks legit, but the web address is not. Do not enter your Microsoft credentials. As soon as you do, the hackers have access to your email and all sensitive information you have ever sent or received via email. The phishers will then send the exact same email that you fell for to every contact in your address book.

How to dodge the threat: never enter your log-in credentials to view an attachment. If an email includes a hyperlink, hover over the link with your mouse (don’t click) and watch for a link preview to appear in the corner of your screen. In Outlook, this will be the bottom left corner. You’ll be able to see a preview of the web address the hyperlink is trying to send you to, and if it’s different from the one typed out in the email. In this case, if the domain isn’t “office.com” the email is fraudulent. This is a fast and simple step you should always take before clicking a hyperlink in an email. And when it comes to sharing sensitive information like bank statements and government IDs, you should always use a secure, encrypted file sharing application like SmartVault instead of sending the document as an email attachment. 

Common Threat 3: “You Have a Voicemail” emails

Are you surprised to be receiving an email notifying you about a new voicemail? Does it have an attachment? Is the sender posing as RingCentral or another VOIP phone system provider you use? Remember: if it seems suspicious, it probably is.

How to dodge the threat: don’t download the voicemail. If you want to be sure you’re caught up on your voice messages, navigate to your voice mailbox the way you usually do and avoid interacting with the email in question.

Best Practices

There are so many ways to avoid phishing scams, but the most important thing to do is stay observant. If something seems off about an email, it probably is. Below, we’ve outlined a few specific best practices that should help you avoid scams:

  • Set-up two factor authentication. Do this for all websites/applications you have log-in credentials for. It might seem inconvenient to go through one more step to access your online accounts, but this practice is still more convenient than dealing with a successful cyber security attack. Apps like LastPass Authenticator or Google Authenticator are an option. These apps provide a six-digit code for you to enter once you’ve logged in to your desired online account. Many other web-based companies offer the option to have an authentication code sent to your personal cell phone or the email associated with the account. How does two factor authentication help? Even if a phisher gets your credentials, they still need access to your email, text messages, or authenticator app to get the authentication code and hack your account, making it significantly less likely they’ll be successful in their attempted breach.
  • Keep up with phishing scam trends. Check for updates from Forbes.com, PCMag.com, or your favorite trusted business news source for updates on phishing trends and recent cyber security threats.
    1. Don’t open the door for strangers. Never grant access to your computer to someone you don’t personally know, even if they look like a QuickBooksⓇ rep. Your accountant and your IT Support vendor/employee are the only people you should ever allow access to.
  • Watch for inconsistencies and typos. Are there misspellings in a marketing email? Does the subject line have five exclamation points? Is your name or the name of your company spelled wrong? When it comes to emails, if it smells like a phish and looks like a phish…well, you know the rest.
  •  Double-check the sender. Always check the sender’s email address. If the name associated with the email address says “Rhonda Rosand” but the email address differs from the one you have on file for Rhonda Rosand, the sender is a fraud. In cases like this, you should check with the individual through another previously established method of communication, be it a phone call to a number or email you already have on file to confirm your contact actually sent the email you’re looking at. Don’t reply to the questionable email with, “Rhonda, is this really you?” If you were a hacker, how would you respond to that email? Red flags include a professional email that includes an @gmail.com (or similar) domain, a slightly misspelled name, or a domain that differs from that of their company’s website.
  • Train your Team. If you received a sketchy email, chances are your team received it, too. Send out an all-company message about the threat and tell employees to notify you or your IT professional immediately if they interacted with the threat. Share trends in cyber security threats, and host frequent training on cyber security best practices.
  • Trust your gut. Even if the sender looks familiar, if they’re asking for weird information or are trying to send you an attachment in an unusual way and it seems suspicious, trust your gut. Look for other clues that they might be an imposter: is a hyperlinked web address different from what it should be? Is their email address different from the one they typically use? Is their tone or communication style different than usual? 
  • Keep your passwords strong and secure. LastPass is a great solution for dual factor authentication, generating complex passwords, and storing sensitive information securely. You can read more about this helpful cyber security solution in a recent blog post of ours here.
  • Don’t send sensitive information via email. Avoid sending credit card information, banking information, W-2s and 1099s, pictures of vital documents like drivers licenses, social security cards, etc. via email altogether. Instead, use a secure document management system both parties are already aware of.

When in doubt, don’t click that sh!t

When it comes to Cyber Security, It’s always better to be safe than sorry. Be suspicious of communication that seems a little off. Avoid unusual emails and contact your IT security provider (or accountant, if it’s related to accounting) to ask for their insight right away, especially if you’ve already accidentally interacted with the phishing attempt. New Business Directions is well versed in phishing scams, and we have a keen eye for malicious emails. If you’re a current customer and feel unsure about an email or solicitation you recently received involving your accounting software, reach out to us.