Entrepreneurship is a fancy kind of sport where one needs to be even more strict regarding money than in his or her personal life. An experienced entrepreneur with accounting service already knows how to deal with different kind of other services which are offered almost as mandatory, although the only certain thing is that they cost money. The rumba begins already when you register your business and at the same time give your contact details. The amount of incoming e-mails, phone calls or even paper mail increases at once. It’s not even guaranteed to be avoided from the bombarding of telemarketers when leaving the phone number box empty since they can carelessly track your current employer’s number given to you. Today there are still companies which take their own privilege to interrupt anyone’s work day and start to sell their products with an endless monolog. However you can’t really give an advise to a start up entrepreneur not to take calls from unknown numbers. Blocking telemarketer’s phone numbers is instead advisable as unnecessary contact attempts start. It’s also recommended to end irrelevant phone calls as quickly as possible and save time for both. However I try to do my best to be polite in these situations since the caller is just doing his or her work and trying to earn a living.
What is Entrepreneur’s Money Desired For?
First comes to mind insurances, spots for advertisements, phone and telecommunication, electricity contracts, different kind of software and administration services like accounting services. Before I comment on the software and accounting services very familiar to me, I want to pay attention to mystical “business subscriptions”. The only specialty seems to be their higher price compared to consumer subscriptions. Let’s take internet connection subscriptions as examples. It is very hard to get the seller to accept that one wants to buy a similar connection for a company use which is aimed for a private use. ”Well, it is basically our consumer sector’s products which can’t be sold in this case” kind of explanations have become very familiar to me. In the business subscription there are either more services than you will ever need or it might be so that there is no real difference at all when it’s compared to consumer subscription. The only difference is the price which is higher for companies.
An interesting single experience was with an IT application which was aimed for optimizing the electricity usage. The only difference between the company and consumer option was, in addition to higher price, the possibility for monthly payments instead of a single one-off payment. When there was no need for that the next argument was that this consumer subscription can’t be sold to a company. When I didn’t get an answer to ”why not” in the end, I of course made the more cheaper consumer order but under the company’s name as the use was going to be business related. There is also a trap for this topic that one of the requirements for VAT reclaims is that the expense receipt usually has to be under the business name! So when you make purchases for the company you should always try to avoid invoices and receipts with only your own name. And even if it is a tax deductible expense it doesn’t mean it’s free! This kind of misunderstood sale attitude I have also noticed in practice.
Although many offered services like all-inclusive insurances sound reasonable, an entrepreneur has a great risk to drift into a situation where different kinds of fixed administration costs are bigger than the revenues.
Entrepreneur’s Finance – Don’t Underestimate the Common Sense
AutoAccount is selling accounting services and therefore I am slightly biased to comment on their active sales efforts. I can however say that as long as I can influence on the company we will not do so called cold calling where a number is picked from a list and one calls and tries to sell accounting services. Nowadays the services have to be brought to an entrepreneur’s attention by other means. In addition I recommend you to be very careful about what level of financial management services your size of a company needs. For example if you are a self-employed or you are managing a small company which employs a couple of persons, a basic online accounting service is probably enough. You won’t necessarily need versatile software where the most familiar feature will probably be its fixed monthly payment. It’s recommended to choose a reasonably priced accounting service which however enables to keep your financials available and in your own hands. Often it is also beneficial to brainstorm your own thoughts with someone outside your company but it is dangerous to think that an external consultant knows your specific business better than yourself. Therefore you shouldn’t underestimate yourself as the expert of your own company since no one has spent so much time thinking about your company’s matters.
Micropreneur’s financials can often be controlled by the following information: cash based accounting, bank account balance, the total balance of unpaid expense bills and estimation of the taxable income. This information can be managed and be available very inexpensively with the functions of bank services and online accounting service AutoAccount.
Author Mikko Ilves is an entrepreneur and the Chairman of the Board of Digibalance Group. More blog updates: www.autoaccount.info/blog/