Monday, August 30, 2010
If you need to prepay for some of your Inventory items, you’ll want
to record the expense without adding the inventory to your list of available products until the products actually arrive. The easiest way to do this is simply to Write a Check or Enter a Credit Card transaction to the Vendor but
expense it to your Accounts Payable account and assign it to the Vendor Name in the Customer/Job field.
This will create a Credit for that Vendor that you’ll be able to apply when the actual bill arrives. When the bill arrives, you’ll enter it for the full amount. Then when paying the bill, you’ll apply the available credit. Your Inventory count will be correct and so will your bank account!
Follow these steps:
1. Create a new regular check with the same date, check#, and payee as the original
paycheck but use the Payroll Expenses account.
2. Void the regular check you just created and make a note in the memo field regarding
the reason for voiding. Choose Edit>Void from the menu bar.
3. Find the original paycheck in the check register and change the check # to 'To Print.' Record the change.
4. Choose File>Print Forms>Print Paychecks from the menu bar to reprint the paycheck.
This process keeps the original paycheck perfectly intact and will have no adverse affect on your Payroll Liabilities.
To add an icon to the Icon bar, open the form or report you want to add, customize it to meet your needs, and choose View | Add xxxx to the Icon Bar. Simply choose an Icon you like and give the item a nice short label. Then click the OK button to add the icon and close the window. Now, whenever you need to see that daily cash report or write a check, etc. just click on the icon.
To delete an icon from the Icon Bar, choose View | Customize the Icon Bar. Then select the item you want to delete and click the Delete button. Then click the OK button to delete the icon and close the window.
If you work with individuals or companies to whom you send 1099-MISC forms, you can set up QuickBooks to track all 1099-related payments. At the end of the year, you can have QuickBooks print your 1099-MISC forms.
First open the 1099 tax preferences. Edit>Preferences>Tax:1099. Select the Company Preferences tab and for the “"Do you file 1099-MISC forms?" option, select Yes. Next link the 1099 categories you report to the IRS to the QuickBooks accounts you track them in, and then click OK.
Once the preferences have been set up, you need to set up the vendors eligible for receiving 1099-MISC forms. To do this, select the vendors from the Vendor Center, click on “Edit Vendor” and on the Additional Info tab enter the vendor tax ID number and then check the “vendor eligible for 1099” box.
Each time you make a payment to a 1099 vendor, QuickBooks automatically adds the amount to the total you must report on the vendor's 1099-MISC form. You can view your 1099-related payments by creating 1099 reports. After verifying that the reports include the right vendors and cover the right accounts, you can print 1099-MISC forms for your vendors on preprinted forms designed for your printer.
It is actually very easy to edit a memorized transaction. From the Memorized transaction list, Double-click on the transaction that you edit. Make the correction, then re-memorize it(control + M)-(select replace the previous transaction). Cancel the open transaction by clicking on the close window button (X).
To modify the frequency, from the memorized transaction list highlight the memorized transaction, Ctrl + E (to edit right click on the mouse and select edit). Change any information required with the scheduling of the transaction and click OK.
Sunday, August 29, 2010
Would you like to know the total record count of a View Listing without paging through 250 records at a time? Here is one way to accomplish this – Create a custom report. Use the built-in Microsoft CRM Report Wizard to create a report to display the record count. This report is then available in the corresponding CRM entity's view or form record. Plus, it supports filtering (like Advanced Find) to drill down on the record counts dynamically.
Following are the steps to create a report that gets the total # of contacts:
1. Create a new custom attribute "Total Count" type "nvarChar". This field is not going to be use for any data storage - just for grouping the contacts together to easily display the total count. Alternatively, you can use an existing "nvarChar" attribute that is not being used for storing any data.
2. Create a new Report. Workplace >> Report >> click "New".
3. Click on the "Report Wizard" button to create the new report via the Report Wizard
4. Select "Start a new report" and click "Next"
5. Give the report a name "Contact Records Count"
6. Clear all the initial report's filtering criteria.
7. Select the "Total Count" field created in step 1 .above for the initial grouping. Note: Be sure to select "Count" for "Summary type".
8. Select some columns to display. Since we are mainly interested in the total record count, only one display column is needed.
9. Select "Table only" and click "Next"
10. By default, this report will be accessible in all the related Contact areas. Save the report.
The "Contact Records Count" report is now available in any Contact's view or Contact's record form to show you the total records count. . The "Not Specified (Count: #)" displays the total count.
A client recently asked how they could get to their Case entry screen more quickly. The following will create a shortcut to a New Case form.
1. Navigate to Services then Cases and choose 'New'.
2. If the URL is not visible, click Ctrl+N and the URL will become visible.
3. Copy the URL.
4. Right click on your desktop and choose New then Shortcut.
5. Paste the URL into the box click next and give the shortcut a meaningful name.
You can do this for any entity and is useful if you have an entity you regularly need to get to in a hurry.
Here is an idea for auditing that you might find useful if you have specific field information in an entity that you would like to audit for changes. The work flows in Microsoft Dynamics CRM 4.0 are very powerful. Here is an example of an auditing tool which can be impleme first thnted through a work flow if you just need an audit log to roll back when people make mistakes.
1. The first thing you need to do is setup a work flow on the entity that creates a note when a new record is created or when a specific field is changed. For example, if you are auditing the Business Phone of the Contact record you would create a Note when the Contact is created or when the Business Phone attribute is changed. Remember: Give the Title of the Note a Specific Name to designate that it is an AUDIT note. For Example: AUDIT CONTACT Business Phone.
2. Now when you create a new contact or change the “Phone Number” field, a new note will be created against the contact showing the current value. To determine the previous value, you can look back through the notes.
3. You can now create an Advanced Find view that allows you to then to look at all of the AUDIT CONTACT Business Phone Notes.
When you need to audit a new field you can create a new work flow. If you are monitoring many fields, a plug-in may be a better option but if you need an audit tool to manage a few key fields a work flow would be a good way to accomplish this task.
Saturday, August 28, 2010
Here’s a tip that will make adding activities so much easier.This very simple tip means that you will no longer have to flip back and forth from the Activity record to the Contact record.
All you have to do is choose the Entity FIRST, and THEN create the Activity.
For Example: When you select a Contact and then create a phone call Activity, the phone number from the Contact will auto-populate in the Activity screen. Or when you select a contact and then create a task, the contact name is auto-populated in the Regarding field.
A client recently asked: When we are logging phone calls, is there a way to have the due date default to the current date?
You can click on the calendar in the activity and enter the date you want, but it would be easier if the “Due” field was automatically populated with the current date. In many cases, especially if you’re actually logging phone calls that you’ve already made or tasks that you’ve already completed, the current date is the correct one and all you then need to do is type in your notes and then, save, and complete.
Include the following script in the On-Load event of the phone call form to have the due date automatically populated:
var CRM_FORM_TYPE_CREATE = 1;
var CRM_FORM_TYPE_UPDATE = 2;
crmForm.all.actualdurationminutes.DataValue = null;
crmForm.all.scheduledend.DataValue = new Date();
// do nothing
Tuesday, August 24, 2010
That's right: My body's going to hell just as the new health-care reform law is starting to take effect. Great timing. I'm not sure its provisions are going to help my sore back any time soon. They're definitely going to affect my small business—and many others like mine—right away. Fellow business owners and over-40 softball players, are we ready?
We'd better be—for more bureaucracy. Think it's fun filling out W-2 forms at the end of each year? Good, because starting in 2011, employers will need to begin reporting the health care benefits received by each employee on their W-2. What? You say you're not tracking that information? We'd all better start. We'll need to make sure our health insurance providers are furnishing us with the right data. Or we'll need to track it ourselves. The data we supply better be right because it's our responsibility to make sure the numbers we're reporting are accurate.
Did I mention my back is sore? That's from all the times I've bent over to watch ground balls skitter between my legs. Now things are going to get worse because I'm going to spend a lot more time hunched over my desk, filling out 1099s. You know what those are—the forms we're supposed to use to report the amount of money over $600 that we paid to independent contractors and self-employed individuals in a given year. Beginning in 2012 we'll still be required to send a 1099 to those guys —along with everyone else who received more than $600 from our companies during the year. They'll be sending us 1099s, too. Oh, my aching back. I don't know the Employer Identification Number or social security number of every vendor in my system. Do you? Better start calling them. Don't have the resources to generate hundreds of 1099s every year? Get ready to break your back writing more checks—to your accountant.
HERE COME BIGGER INSURANCE BILLS
Wait a second. Is filling out more 1099s going to help our health-care system? No more than those shin guards our catcher insists on wearing, even though we play slow pitch. It's all just part of the game.
To play this game, I'm going to make it a point to have a heart-to-heart meeting with my insurance company. That's because I'm expecting yet another significant rate increase as the regulatory demands on the insurance industry grow. If your business were facing an economic downturn, significant uncertainty in your sector, and a government readying to unleash heavy fines on your business just because you have the audacity to earn a lot of money, wouldn't you be grabbing as much cash as you can, while you can? Exactly.
The health-care reform law is requiring health insurance companies to step it up this year. The law says they must now provide coverage for dependants up to the age of 26. They must provide coverage for people with preexisting conditions, such as an inability to hit a slow-pitch softball from a retired dentist. So I'm damned well going to make sure my health insurance company is living up to its end of the bargain and offering these additional coverages to my existing and potential employees. These benefits may not only help me keep my good people on staff, but offer potential employees an incentive to leave their employers and join me. Maybe I can recruit a couple of guys who can catch a softball. If my insurance company complains, I may just report them to my state—the new law provides funding to certain states to investigate excessive premiums.
I'm going to have a heart-to-heart with my accountant, too. Not because his base running is atrocious and his fielding stinks, but because the law offers some potential tax incentives for my business.
PITCHING FOR AN HHS WELLNESS GRANT
For example, companies with fewer than 26 employees and average annual wages of less than $50,000 can now claim a tax credit of up to 35 percent of the cost of premiums. The credit is slated to increase to 50 percent in 2014. The benefits of this tax credit, of course, will be offset by the fees triggered by my accountant's struggle to calculate them and determine how much and when the credit begins to phase out under the law's obtuse provisions. I'll take what I can get.
I'll also look for a wellness grant. The law gave the Health & Human Services Dept. $200 million and the authority to award workplace wellness to companies employing fewer than 100 people. To be eligible, I should have no existing wellness program in place. I'd have to meet certain "health awareness" criteria. (Reminder to self: Remove beer from company fridge.) I'll need to get my employees involved and "provide initiatives to change unhealthy behaviors and lifestyles," such as throwing tantrums on the softball field every time our center fielder drops a fly ball.
Finally, I need to start thinking about 2014, when our best player will be retiring to an over-55 community in Boca. Oh, and that's also the year when everyone's going to be required to have health insurance, either on their own or through employers. That's the year when those mysterious insurance exchanges will be set up to offer less-expensive coverage for both individuals and small employers. Will I continue to pay and provide health insurance for my employees? Or will I scrap the whole thing, tell my people to get the coverage on their own, and pay the $2,000-per-employee annual penalty. What makes more sense for my bottom line? For my employees? For my company's competitiveness?
This is not a decision I plan on putting off till 2013. I need to choose a direction soon. I'll need to discuss it with my employees and make sure to help them with the transition. I can't just yank their health-care coverage on the last day of 2012. I have to give my people time to adjust if I want to keep them happy. Maybe these reforms can provide so much extra coverage that I can start taking steroids—pretty much the only way I'll ever hit one out of the infield.
Gene Marks, CPA, is the owner of the Marks Group, which sells customer relationship, service, and financial management tools to small and midsize businesses. Marks is the author of four best-selling small business books and writes the popular "Penny Pincher's Almanac" syndicated column. He frequently speaks to business groups on penny-pinching topics. More penny-pinching advice from Marks can be found at www.quickerbetterwiser.com.
Friday, August 20, 2010
Her company, Austin-based DMS & Associates, provides outsourced bookkeeping, accounting and tax preparation services. Kimberlee, a CPA for more than 20 years, is meticulous, timely and financially astute. I have held my CPA certification for more than 20 years too. Problem is, I was never too good with details. If it was close enough, it was good enough. You don't want me as your accountant. Which is why I stopped practicing public accounting a long time ago and only sell business software.
So Augustine and I are different kinds of CPAs. She's better with numbers, and I'm better with software and business technology.
And our businesses are structured differently too. Like so many small companies, I have all of our systems and data in-house. I have a couple of servers and workstations. We connect to our servers over our local area network, which is supported by our IT firm. We connect remotely using Windows Terminal Services. This is a typical setup for companies with 10 people, like mine. And Augstine's company too. Except she's not set up that way.
Augustine has thrown her company deep into "the cloud." She does not have a server. She does not have a local area network. All of her software, databases and files are hosted by a company called Rackspace Hosting. Why? "I'm not a technology person," she says. "I'm an accounting person. I'll let someone else worry about the technology."
Rackspace is part of a growing industry of companies that provide dedicated hosting. The company says it has more than 99,000 customers, many like Augustine. Dedicated hosting companies provide their clients with servers, support and up-to-the-minute technology housed in highly secure facilities. Technology is a headache, these companies say. Why go to through the headaches and expense when you can just let the experts manage this stuff? A decade ago this would have been very difficult. But in today's Web-based, broadband world of high-speed connections, it's reality.
Augustine got lucky because her timing was right. She dived into the cloud in 2007. Fast Internet connections were readily available. Cloud computing was getting easier. And she was just starting up her company at this time. So she didn't have to worry about dismantling her existing network and migrating it all to a new setup. There was nothing to un-learn, no baggage to carry into the hosted world.
How did it all work? After signing up with Rackspace, she copied all of her existing files (there weren't too many) from her server to theirs. She then installed her applications, like QuickBooks and Microsoft Office, directly on Rackspace servers using the remote desktop connections it provided. "It was like doing it on a server in my own office," Augustine says. "There's not much difference." From there on, she and her employees just connected directly to the Rackspace server.
The same with clients. A critical part of Augustine's bookkeeping services is that she maintains the accounting systems for her clients. She needed a centralized place to do this, where not only could her employees access the information but her clients could see their books and do data entry when necessary.
Keeping this in-house would be costly and time-consuming. For a company like hers, a managed server setup became the backbone of her business delivery model. "I wanted to focus on bookkeeping and not become a computer expert," she said.
Some software companies offer hosting services for their clients. For example, Augustine could have had Intuit ( INTU - news - people ) host her clients' Quickbooks systems. But the difference here is that Rackspace, like most companies like it, hosts all of its customers' systems, not just a specific application. In short, they're just renting out their servers. And their expertise. That way you not only get access to the box, but it's always updated with the latest patches, backed up and tuned for optimal performance. Daily. Try getting that from your local IT guy.
Augustine found the performance to be as good as any Web-connected software. "We do all of our work through a browser using a remote desktop connection," she said. "I don't remember the last time we had any network problems." In fact, she feels that her business has minimized the risk of downtime, both internally and for her clients. Without hosting, if her server got into trouble or her Internet service shut down, no one could do work. Today even if her office were to go dark, her employees and clients would still be able to work with their data as long as they found an Internet connection somewhere else.
Listening to Augustine's story, I also found something else that particularly appealed to me. Rackspace gives Augustine the ability (for an additional fee) to also host "virtual machines." This way she can demo third-party applications and other software in a test environment before linking them into her production systems. Being in the software business, this is a great feature. Setting up virtual machines for testing, or to run unique applications in-house, can be a pain the neck and require a lot of resources from a server. Remember that I'm not good with details. So testing my work is highly recommended for all of my clients.
So is hosting the way to go for small companies? For many, like Augustine, it's a great idea and one that will grow even more over the coming years. And you'd think by reading to this point I'd be a convert. But I'm not sold on this kind of service for my business. Surprised? Not as surprised as that client of mine back in 1986 when he got a huge tax bill because I forgot to include a few deductions he had.
Sure I appreciate the benefits. I appreciate the easy access from anywhere. The daily updates and backups. The higher level of security. The accessibility of data for both my employees and clients. And not having to worry about internal networks and other IT-related headaches. I get that.
Except that I don't really have these problems. I have two servers: one of them, as mentioned before, equipped with Windows Terminal Services and a virtual private network. This was setup by my IT guy a few years ago. We access everything through a browser, just like Augustine, from anywhere we want. My system has a daily backup. I'm positive we're not running the most recent versions of Windows and could use some cleaning up, but things are working OK.
I'm even more positive that my data is far less secure than it would be if I let a company like Rackspace host it. But we're not keeping highly sensitive stuff like credit card numbers on hand, so I'll take my chances that some kid in Malaysia wants to know next week's lineup for my softball team. And also, we're not the kind of business where clients access their data from our systems the way Augustine's do.
And the cost is still pretty high. Most of the hosting companies I know charge a monthly fee per user for the use of their servers, generally around $100 per month per user. Augustine says she pays about $1,500 per month for her service, which includes the virtual machines and other premium features. So a 10-person company like mine could be paying anywhere from $12,000 to $18,000 per year to host our systems. I currently pay my IT firm less than one-third of that every year, and that includes all the Red Bull they drink. Even replacing a server, which would last me a good four to five years, would set me back about $3,000 to $5,000. I'm not very good with numbers. But these numbers I understand.
Thursday, August 5, 2010
And finally, real estate may now be more within our reach. In many parts of the country prices have declined enough to gives those of us who have enough money squirreled away the chance to buy some property, or at least lease some prime space in once unheard of locations. But there’s still a big challenge. The prices may be lower. But I’m not getting any smarter. I had a hard time understanding the plot of “Avatar.” So can an intellectually challenged penny pincher like me still get a good deal?
Probably. But I’m going to need some help. Penny pinchers are not property experts. We’re experts in our own businesses. Finding the right location is an art, not a science. We may think we know the area, but we don’t have the time to really study it in detail. Prices may have come down, but that still doesn’t guarantee we’re getting the best deal possible. It’s critical to use someone who knows the market.
“We enjoy a healthy relationship with most every significant Realtor, developer and landlord in the industry,” said John Devine, president of Subway Real Estate Corp. of Milford, Conn. “These people know who we are and how we operate. Solid relationships often make the difference between getting a deal and losing a deal.”
Easy for him to say, right? Subway Real Estate negotiated over 2,000 new leases last year alone. That’s a lot of turkey subs. Subway knows that its 25,000 franchisees are not real estate experts. They’re sandwich makers. In most cases, Subway does the real estate work, leases the properties, and then sub-leases them back to their franchisees.
We don’t negotiate leases for a living. We’re not up to speed on the terminology. The minute an experienced landlord gets a whiff of my ignorance he’ll be selling me a house next to those kids from “Jersey Shore.” Smart penny pinchers need to get someone to represent us. Even with all the resources of Subway, Devine knows that the right people will make or break the deal. Among his stable of experts is a good legal team.
I know a lot of good real estate attorneys. Yes, they practice devil worship. But really, that’s only in the evening. During the day, the guys I know also do a fine job creating and reviewing contracts. They are specialists who represent both landlords and their tenants. Like Subway, it’s critical for us to employ a competent attorney. No do it yourself form that we download for free from the Internet is going to replace that kind of expertise. You can find a good attorney that specializes in real estate at your State Bar Association’s website. Or gathering near Stonehenge during the Solstice.
But we don’t need experts to handle everything. There are some things we can do on our own. For starters, we can get to know a potential landlord really, really well.
“We go into each location with the notion that this needs to be a long term mutually beneficial relationship.” Devine told me. “We look for a landlord who has a great property and a great reputation.” Like Devine, we can also ask for references and talk to his other tenants. We can walk around his property at various times of the day and judge how well he keeps it maintained. Most importantly, we can spend some time with him, have a lunch or two, and look him in the eye. We can say to ourselves “My livelihood is going to reside in this guy’s building for the next five years so do I trust him to make sure the roof doesn’t fall in?” A great deal on a new property won’t be worth much if it rains in our reception area.
“Primarily, you need to be concerned about whether the landlord has the economic viability to maintain the property in a first-class condition,” said Bob McComb, a real estate consultant, author and speaker. ”Really make an effort to personally know who you’re dealing with. “
Finally, we can behave ourselves. That’s definitely in our control. People like to do business with people they like. Duh. Concessions are made when one party wants to have a long term relationship with another. The real estate industry, like any industry, is a close circle. People know each other and they will soon know us. Being a jerk might intimidate some, but in the long run will never get us the best deal, no matter how attractive the price is.
Where can a penny pincher find this kind of help? McComb suggests trying the Society of Office and Industrial Realtors (www.sior.com) for office and industrial transactions. He also points out that many retail brokers are members of the International Council of Shopping Centers (www.icsc.org). “Business owners should look for commercial and real estate companies that dominate the market. Call them and ask the manager for the name of their top agent or broker. They should avoid residential brokers seeking the occasional cross over to commercial.”
Don’t get into this uneducated. Read up on real estate leases. Go to a negotiating class. No one’s going to expect you to become an expert. But to properly manage these important people you’re going to have to know what they’re doing. Or at least know enough to supervise so you can leave the details to them. McComb’s book “Navigating Commercial Property Leases” is a great reference.
“Solid relationships often make the difference between getting and losing a deal,” Devine said. It’s the people, not the prices, that will turn a good deal into a great one.
You would think Don's tax bite would be a lot more, though. That's because in Mad Men's 1964 world, the top tax rate was 91 percent. If former President Bush's tax cuts are allowed to expire at the end of 2010, our top tax rate would go up to 39.6 percent. So we're not even close, right?
Wrong. This is just one of the myths about the cuts.
Most business owners aren't making anywhere near the money that would trigger these top rates. Even so, there seems to be a big gap. Assuming these tax cuts do expire, and President Obama's plan gets approved, a small business owner earning about $200,000 today could look at paying a federal tax rate of around 33 percent. An ad man earning that kind of money in 1964 would be looking at a federal tax rate of about 47 percent. But wait!
Was Don Draper paying an extra 10 percent to 12 percent of his income for city and state taxes in 1964 like he would be if he lived in New York today? And was he paying an additional 9 percent of sales and excise taxes on just about everything he purchased back then? Or another 8 percent for FICA and Medicare taxes? Was he faced with surcharges, transfer taxes, highway tolls, and duties like we pay now? Was he paying huge cigarette and whiskey taxes like we have today? That alone would break his budget, along with many of his co-workers'. Taking all this into account, don't believe the myth about higher taxes back in the day. Today's tax burden for the typical small business owner is, and would be, pretty comparable to what the guys at Sterling Cooper Draper Pryce were paying.
FRUSTRATING, NOT CRIPPLING
Another myth? I'm pretty sure I heard one politician tell a TV reporter on Fox that the expiration of the Bush tax cuts would "cripple" small business. Not exactly. No small business owner I know, myself included, supports any kind of a tax increase, particularly on the heels of the last recession and our currently anemic recovery. But just hold on. The tax cuts really affect families making more than $250,000 per year. And even The Wall Street Journal recently reported that a family with income of $300,000 per year would be paying approximately $3,995 more in taxes under Obama's plan. That sucks. But it's certainly not crippling. That amount may have purchased a Cadillac in 1964. But today it'll buy that family a couple of tanks of gas for their Hummer.
And although some deductions and exemptions are being reduced, others are being boosted. For example, the Section 179 deduction for purchasing certain capital equipment would be raised to $500,000 next year if the President's jobs bill is passed. Higher taxes mean less money in my bank account. So naturally that will impede my ability to hire more people, pay higher earnings and benefits, and even make those capital investments. Yes, for most small business owners like me, the effect will be frustrating. But not crippling.
Even so, I don't agree with Treasury Secretary Geithner. He's promoting another myth. He supports letting these tax breaks expire because these additional taxes will help fund the stimulus that's helping the economy to recover. I may like to watch Jersey Shore but I'm not a complete idiot. Ask any smart business owner or anyone with access to Google (GOOG) and they'll all tell you that higher taxes impede growth.
So I have differences with the Obama Administration. But that's not to say that the President isn't a supporter of small business. Others are trying to spread this myth, too. I'm not crazy about his economic policies. But he's doing what he believes he needs to do to help business owners. His small business jobs bill proposes to increase SBA guarantees to ease credit and offer credits for new jobs. He's proposing tax incentives to people who invest in small companies. He wants to allow small businesses to be able to carry back losses and get tax refunds from prior years. He's proposing to keep tax rates the same for what he believes is the majority of small business owners. Of course, he could be doing more. Of course, people will argue with his ideas. But to say he's not a supporter of small business is like saying both Don Draper and I do well with the ladies. One of us doesn't. Can you guess who?
MAKING PLANS NOW
Yes, there are lots of myths about the expiring Bush tax cuts. So what can a business owner do?
For starters, many of the business owners I know are cutting back on watching SportsCenter and instead spending a little more time watching C-SPAN. That's because the Bush tax cuts issue will be a divisive one this fall as election season approaches. And what happens will have a big impact on their companies. Like a good ad campaign, many business owners I know are making their plans now, rather than later. If taxes are expected to rise, they'll be ready to take action.
Like bringing in the cash before the year's over to take advantage of lower tax rates. And collecting receivables and asking for prepayments. And cashing in their stocks to take advantage of the lower capital-gains rate.
As deficits are projected to increase, it's conceivable that taxes will continue to rise. So a lot of smart business owners I know will push their expenses into 2011. They'll defer payments. They'll work out special deals with their suppliers. And they'll become expert about tax deductions. They'll spend more time with their accountants. They'll keep better track of their expenses and formulate better arguments for any aggressive position they may decide to take. These are the plans they're making.
Don's lucky to be living in 1964. He's about to see the first appearance of the Beatles, the worldwide premiere of Mary Poppins, and a huge break in federal taxes that year which will spur a giant economic boom. Unfortunately, today's business owner isn't so fortunate. We can't drink bourbon in the office. We can no longer smoke wherever we want. And looking at those big deficits, we can't stop our taxes from going up either. That is no myth.
1. How long has it been around?
You want something on the leading edge, not the bleeding edge. You definitely don't want to buy a first release of anything. Let some other poor guy discover those hidden bugs. Windows Vista? Wait for the first service pack. That new line of laptops from Dell? Hang back a while. In technology, new and reliable are rarely used in the same sentence.
2. Never buy technology in a vacuum. Get references. Do site visits. Call other users. Check newsgroups and forums. Google the vendor. Buying a new service management system? Consider going to the vendors offices for training before you buy. That way you can beat up on the instructor and talk to other users. Does the vendor host conferences or shows? Visit, ask questions, get comfortable.
3. How will it generate profits for my company?
If a piece of technology isn't going to help you increase revenues or decrease costs then why bother? Your current system may not be pretty, but if it ain't broke why fix it? Buying software or hardware should be a quantitative decision. You should be able to mathematically calculate how much estimated profits will result, with certain assumptions, from this investment. Do the ROI and see what shakes out.
4. Can I take a test drive?
Never buy just on a vendor demo. Get the software or hardware and test it yourself. If a software company doesn't let you drive their product, then don't buy it. If a hardware company can't give you a test piece, then reconsider. Once you make that decision and fork over the cash those eager and super-friendly salespeople will be on to the next deal and you'll be yesterday's news. Do your due diligence beforehand.
5. Will it speak to my other systems?
Are you adding another repository of duplicate data? Are you creating additional tasks? When buying new technology make sure it's open to others. Proprietary systems are becoming more and more a thing of the past. Make sure that you can tie it to other systems. Even if there's no out of the box connection you want to still have the option of hiring someone to write the integration. Keep those options open so you don't paint yourself into a corner.
Great penny pinchers don't buy stuff just because it's neat or cool or because Microsoft tells you to buy. I have some clients that are happily using systems that are more than 15 years old! Oh it looks clunky and stupid, but the job is getting done and instead of throwing away thousands to upgrade, they're investing (or saving) somewhere else.