Main reasons why people don’t do budgets because they find it boring, unnecessary, they don’t have time, find it difficult or lack the confidence in making money-related decisions. Budgeting in 4 steps! Step 1 – Track your expenses – There are two ways to do this. Hard way and easy way! I used to write… Continue reading Tell Your Money Where To Go
You should keep your returns until the statute of limitations runs for filing returns or filing for a refund. For most taxpayers, that means keeping those records generally a minimum of three years following the date of filing or the due date of your tax return, whichever is later. In addition to the returns, keep… Continue reading How Long Should I Keep My Returns?
In the beginning, there was an idea, a vision, a goal. Start a practice, be your own boss, work flexible hours and most importantly, do what you love to do and what you believe in. The beginnings are so sweet, full of passion and determination. However, according to statistics published by the Small Business Administration,… Continue reading Why Some Practices Struggle?
Name one person in vet school who said practicing veterinary medicine would be easy. After all, being an awesome doctor and practice manager are incredibly different skills. What makes your clinic or hospital different? Unfortunately mirroring the veterinarian down the street, whether intentionally or not, it something we see a lot! I hope you had… Continue reading The Choice Every Veterinary Practice Owner Should Own
You might recall a blog I wrote a few months ago encouraging you not to become a buggy whip. One of the points I was trying to make deal with how technology was changing the ‘way we work and the adverse effects of doing things “the way we have always done them”. In continuing with… Continue reading The Power of Team
Just the other day, I read that a major national retail chain had declared chapter 11 bankruptcy. How could a once thriving company potentially become extinct? While I don’t know the specific details, perhaps it was because they continue using an all but dead business model. This company sells and rents music, movies, games, and other entertainment through… Continue reading Don’t Become a Buggy Whip
Why do we use Xero for our own company and also recommend it to our client’s for online accounting? Here are a few of the reasons. Xero is very user-friendly and is simply better,faster, and smarter. The Xero bank reconciliation is simple and efficient, it has an approval system for invoices and bills and offers features that… Continue reading Why Use Xero in Your Veterinary Practice?
Last week we visited Xerocon in San Francisco. The only thing that didn’t surprise us was the cold weather. LOL! Xero is a cloud-based accounting software alternative to QBO (QuickBooks Online). Why would I want my books in the cloud? – It will give you unlimited access. If there is the internet, there is Xero. You can sit… Continue reading Xerocon: Cloud-based accounting is not happening, it already HAPPENED.
Unfortunately, many business owners don’t know how to read financial statements or even why they have them. Yup, they are in your drawer, somewhere…next to the trash can… (In the trash can)…but certainly out of sight, out of mind; just in case the banker asks to see them. Face it, people who are looking at the financial statements are usually creditors and investors. What’s the big deal anyway? After all, they report the past. Who cares, it’s already happened and there isn’t anything that will change it. In this day and age, looking at the past is rarely appealing to anyone. But what if you can predict the future? Hmmm…
Let’s pull those financial statements and look for warning signs!
Balance Sheet (assuming accrual basis): Accounts Receivables (A/R) – Higher A/R might be a good thing if you can collect them. Dig deeper to see the aging breakdown. How many are outstanding for 30/60/90 days? If the majority are over 90 days, that would suggest you have a problem with collections or establishing appropriate credit terms. Once you understand the “real problem”, there are multiple ways to improve this number. Why invoice reminders are your secret weapon to getting paid on time. When to consider factoring your accounts receivables. Like anything, the real key is understanding the real issues.
Income Statement: Revenue – Compare multiple years. Is the revenue slowly decreasing every year? Do you know why? Are you losing clients? Did you change the services you are offering? Do you have a pricing problem or perhaps a staff member is stealing from you. It is important to define the issue or issues to understand why and what to do about it. Without a correction, this means less money will be flowing to your business, less money for salaries, new equipment, etc.
Cash Flow: Investing Activities as Reflected on a Cash Flow Statement – Have you ever wondered “where did all the money go”? This statement helps answer that question by breaking activities into operations, investing, and financing activities. It is important to know the difference here. Cash out is reflected as a negative number while cash in is reflected as a positive one. If net cash flow is a negative number it means the company is investing money into new and better equipment. So a negative number is seen as a positive thing. It shows that the company is investing in new equipment, keeping up with new technology, etc. Have you ever thought “no way did I make that much profit (or loss)? Have you ever looked at a statement of cash flows for your practice?
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In the United States, less than 1% of pets are covered by pet insurance. Apparently, not many pet owners are convinced that their healthy puppy will need a surgery one day or extensive care, which they might not be able to afford. As a veterinarian, this should be a no-brainer. So why not help your customer’s bank account… Continue reading Pet Insurance Can Bring 52% Increase in Revenue