What a business is all about

There is way too much noise out there about businesses and their relationships with growth, technology, management, marketing, customer service, social responsibility, tax offices, etc. At times we need to just simply things and below is a simplistic four point view of what a business is all about:

1. A business needs to find customers at start
2. We then need to retain those customers and bring some stability in the business
3. We then need to find more customers
4. We need to grow our staff and operations without losing control of the business

Simple as!

A business can be as simple or as complicated as you want to make it, make yours simple and focus on the four above to achieve whatever it is that you want to achieve from your business.

Why are we being bad to good small businesses?

When we get bad service or products we are endlessly complaining and making sure we tell our friends, family, colleagues and even strangers of what great injustice was done to our spending. This is fine and that is probably how our brain is programmed but what are we doing when we get great service and products from all the good small businesses out there? And the answer might be something not far away from "nothing".

There are thousand of small businesses out there who are providing exceptional service, great products and going over and above what is required from them but what do we do when we receive exceptional value for our money? Nothing!

Next time when you get bad service; feel free to leave bad review, tell people, tweet, put up a post on Facebook or use any other medium to warn others about such players; you are entitled to that. If you are going to use time to complain about the bad, do also take out your time and use the same mediums to promote the good experiences you are having with the small businesses out there because if you don't; you are leaving these good small businesses on level field with the not so good service providers and that just can't be right! The hardworking and honest small businesses from all fields deserve better! 

So next time you receive great service from a small business, tell everyone you can because they might not have the resources to advertise themselves but your couple of minutes might just help them!

BY SURESH RAJANI 

Tax debt transparency laws are here (well almost)...

The government in a bid to increase transparency of tax debt and to provide a true picture of credit worthiness of businesses has released exposure draft legislation for consultation that will allow the Tax Office to disclose business tax debts to credit reporting bureaus where the businesses have not effectively engaged with the ATO to manage their debt.

For most businesses that pay their tax bills as and when they fall due, this is not of concern but for those entities that have ABNs with tax debts of over $10,000 overdue for more than 90 days, this is about time they get their tax affairs sorted and managed.

One of the first signs of a business not being able to manage its finances is when it starts falling behind on paying its tax debts so this is a good piece of legislation for small businesses who need to continually look for new business but don't always have enough information to determine if a new client is creditworthy or not. This law will provide useful information to businesses that are proving credit to new customers or are increasing the credit limits of existing customers.

For those businesses that do the right thing, they need not worry. Those that try and take unfair advantage by not paying their debt and using the money in their business instead, be aware!

By Suresh Rajani

Time is not Money but...

If time was money we would all be equally rich as we all start with 24 hours in a day, 7 days in a week and 52 weeks in a year. The fact is that at the end of any given period (day, week, month or year) we all have earned different amounts of money.

Time is not money and how much time you have has nothing to do with money. What you did, are doing or will do with your time will determine how much money you will have.

You have no job and are not doing great financially. You can either use your time feeling sorry for yourself, look for another job or spend your time brain storming of a business you can start that will enhance your financial position.

You start a business and after a few months things are going really well and things get really busy. You can do two things with your time. You can either keep putting all hours in the business or you can hire and train someone else to do your work and you can focus your time thinking of the bigger picture and working on how you are going to capitalise on the good platform you have got.


BY SURESH RAJANI

Suresh Rajani is the Tax and Business Adviser at TAX FIRST (A tax and business advisory firm)

www.taxfirst.com.au

Businesses need to understand what sunk costs are.

Imagine a gambler having lost tens of thousands of dollars at a casino and still playing in the hope of "recovering" the lost money. Sounds far too familiar doesn't it? Common sense would say that the fact the money has been lost should have no impact on the gambler risking more money but he/she still does. The age old gambling thinking is the simplest example of why businesses need to understand sunk costs.

Sunk costs by the very definition are those costs that have already been incurred and cannot be recovered. If no matter what you decide to do, the sunk costs are gone, you should deem them irrelevant for the future decision making.

It's  a norm for a business to spend thousands of dollars in developing a product, service or an idea. If even after trying its best the product/service/idea is not profitable, then it would make sense to cut your losses and drop the idea. The fact that you have spent thousands of dollars (sunk costs) to get to a certain stage does not give you the license to waste many more thousand of dollars in the hope of turning things around.

Don't sink your business further to recover the sunk costs!

BY SURESH RAJANI

Suresh Rajani is the Tax and Business Adviser at TAX FIRST (A tax and business advisory firm)

www.taxfirst.com.au

What is the worst that can happen?

Fear and lack of confidence holds us all back. The fear of what would happen if you do something or lack of confidence in yourself knowing something can be done but not believing in yourself to be able to do it.

We all have ideas that we are not sure would work or things that we don't bring into motion as we are uncertain if they will be successful. Next time you have any of these thoughts, just ask yourself "What is the worst that can happen if I do this?" As long as the answer to the question is not "You will die", then go ahead and do it.

Have an idea that you think can be a great business but are pursuing it? Go ahead and get it in to play. What is the worst that can happen? You will loose a bit of money. There are lots of jobs out there and money can be earned back.

Have a thought about how the business that employs you can be improved? Go ahead and let the manager or owner know. What is the worst that happen? It would be knocked down as not such a great idea or not implemented. At least you would be seen as someone who cared about the business and what happens in it instead of just getting paid for your work.

BY SURESH RAJANI

Suresh Rajani is the Tax and Business Adviser at TAX FIRST (A tax and business advisory firm)

www.taxfirst.com.au

What a business can learn from a car indicator?

You are driving down a busy road and you realize you have to change lanes as the lane is either moving too slowly or your exit/turn is coming up. You flick the indicator to let others know of your intention to change the lane and to your surprise, no one gives you the space to change the lanes. You are furious as you think the other people are intentionally not letting you change lanes. With lots of struggle you somehow manage to change lanes and barely make it to your destination. 

 

Next day while driving the same thing happens and you wonder why. You check the car and realize that the  the signal light at the back of your car is not working and now you understand why no one was giving you way.

The above scenario is very much relevant to every business out there. You believe your business offers great products and/or services but no one seems to be willing to give you a chance to break in to the market or grow your business. The reason may not necessarily be the people around you. Maybe you are flicking the indicator but the indicator light is not blinking enough to catch the attention of your potential customers. So instead of blaming everyone else for not wanting to buy your great products and/or services, you should fine tune your business practices and find ways to improve what you do.

BY SURESH RAJANI

Suresh Rajani is the Tax and Business Adviser at TAX FIRST (An accounting and business advisory firm)

www.taxfirst.com.au