Creating a Money-Making Business Plan

In my experience (at least with the small businesses I’ve worked with), a business plan is often considered an “unimportant” waste of time, and many small business owners forego creating one.  The truth, however, is that a Business Plan can be incredibly beneficial for a business.  Not only can a business plan create a “Guide” for a company and its employees, but a good plan can also be taken to the bank in order to try and raise funding for a small business.  It can attract investors as well, and it can help focus a business owner’s vision in order to make the business as profitable as possible.

While there are tons of business plan models on the internet today, I can’t help but want to throw my own cap into the ring as well.  There are the business plans that a lot of general businesses use to satisfy mentors (or spouses), and then there are the types of business plans I’ve worked on, the type that big businesses pay tens of thousands of dollars (and hundreds of thousands) of dollars before they ever so much as sign a rental-lease agreement.

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The difference between a “General” Business Plan and a Business Plan that Makes Money comes down to one very important thing…Research.

When a small business owner includes research into a business plan, they are showing banks and investors that they are not going into a business venture blind.  A well-researched business plan shows forethought, logic, and realistic thinking.

Therefore, to create a business plan that will help raise money, a business should include the following elements in their business plan:

  1. The Mission Statement: In Bookkeeping Money-Saving Tip # 15: The Mission Statement, I discussed the importance of having a Mission Statement.  It is just as important to put that Mission Statement into the Business Plan.  Consider it the “Sales Pitch” of the Business that basically tells an investor the Business’s main goal.
  2. An Introduction:  The introduction is a fairly simple concept.  You create a page or two (or three) about the basic business concept.  What is the business selling?  If there is a location, where will that location be?  Will the business have an inventory  and if yes, where will that inventory be kept?
  3. Demographics:  Demographics are an excellent option to add to a business plan because it exhibits that you know who your ideal, targeted customers are and who they can be.  The demographics can help a business see where they should be focusing their marketing dollars, and how to theme their business to attract those ideal clients instead of creating a business that tries to “attract everyone.”  (Read Paint a Target on Your Customers for more information on how to do your own demographic analysis.)                                                             teamwork 2
  4. Competition Analysis:  You know the expression, “Keep your friends close, but your enemies closer”?  This expression is just as true in business as it is in life.  You should know what your enemies (ie, your competition) are doing in their businesses, because every choice they make could potentially harm or help your own business.  Therefore, creating a section that lists ALL of your local competition, as well as what products they are selling (that you may or may not sell as well) and what prices those products are marked at.  The more you know your competition, the more you will be able to create a business model that grinds theirs into the dust (should that be your wish).  Either way, it shows investors that you have a strategy to stay afloat despite what your competition is doing.
  5. CompassLocation Analysis:  A large majority of businesses draw their customers from within 10 miles of their location…TEN MILES. However, the more unique that business and its products are, the farther distance a customer is willing to travel in order to buy what that business is selling.  On the flip side, the less unique a business and its products are, the smaller the distance a customer is willing to travel to make a purchase.  For example – Disneyland has a very unique product; people are willing to fly from all over the world to experience the unique product that Disneyland offers (and that no one has been able to yet duplicate).  Another example – Souvenir shops.  Souvenir shops all sell the same products, and they all try to rent space where the tourists are.  The end result, tourists have so much choice on what souvenirs to buy and where to buy them, they don’t need to go far from their hotels to get what they want.  (In fact, they often buy from within the hotel).  So, in order to create a competent location analysis, you need to include the demographics and competition within YOUR 10-mile radius.  (You can read more about Location Analysis in my article entitled:  BOOKKEEPING MONEY-SAVING TIP #4: Analyze Your Business Location.)
  6. Marketing Plan: At this point, you should know your competition AND your customers, so you should have a pretty good idea how you can target your marketing campaign directly to your ideal customers.  Let your investors know as well.  Include a section just about marketing.
  7. The Dollars and Cents:  No investor is ever going to invest in a business that looks as if it is going to fold its doors as soon as it opens (unless that business is a non-profit).  Investors want to know that a business is going to make money and that they will recoup their initial deposit.  Therefore, the dollars and cents is one of the most important things to include in the Business Plan.  If the business is already open, then bankers would ask for a “Profit and Loss” Statement, as well as a “Balance Sheet.”  But whether the business is in operation or not, another excellent idea to include is the “Pro Formas” or basic monetary projections.  You can create a Budget and include it Graph line: up and down 1in the dollars and cents section, and you can project from that budget how you plan to make more money (or save money).  Calculate Budgets with Low Income-Expense Projections, Mid Range Income-Expense Projections, and High Income-Expense Projections.  That way, the investors will know that the business will still say afloat even in “Hard Economic Times.”
  8. An Executive Summary: The Executive Summary is basically the bare minimum summary of what the business has created plans to accomplish.  It takes the main points from each section, and presents them in a direct manner.  The Executive Summary is basically your “In Conclusion” statement, however, this summary is going to go at the BEGINNING of your Business Plan.  Most investors never really read past the Executive Summary (unless there is something in the Executive Summary that doesn’t make sense), so in essence, the Executive Summary can be the main section that makes or breaks your business plan’s goal:  to raise capital.   Therefore, make sure your Executive Summary has ALL the main items you want an investor to know, and put it right after your Business Plan’s Introduction.  Consider the rest a guide for the business and backup for the more thorough investors.

While I cannot guarantee that this business plan format will raise capital (after all, there are many other factors that investors take into account besides the business plan), I will say that a well written business plan can tip funding in a business owner’s favor.  You really have nothing to lose by creating a thorough, well-researched business plan – but you do have everything to gain.

Diary of a Bad, Bad Bookkeeper (Day 40) – Stealing the Boss’s Identity

Betty Bookkeeper Headshot

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I got a new credit card today. Well, technically, I got a new “company credit card” today. When the boss wasn’t around, I went ahead and called his credit card company and told them we had lost his company card and needed a new one. They asked me for all of the usual identifying information – social security number, mother’s maiden name, address, phone, account number, etc. – and of course, I gave the guy on the other end of the line all of that information. I then told him that I wanted to change the password question “because the last bookkeeper got fired, and we need to protect my boss’s identity.”

The guy at the credit card company didn’t even miss a beat – after all, companies get new bookkeepers all the time. “Which question would you like?” the guy asked me. “Do you want a question about your high school, pets, favorite cities…” and on and on and on.

“How about the question about pets,” I answered innocently.

“Okay. What is your pet’s name?” he asked.

I thought really quickly, then answered, “Moron.”

“Excuse me,” the guy on the phone said.

“My pet’s name is Moron,” I repeated sincerely. What I wanted to add was – “and Moron’s my boss” – but I managed to hold my tongue… barely. It was so hard.

“Okay. Moron it is,” the guy said in a serious tone while clicking away at the keys on the other end of the phone.  “Anything else I can help you with?”

“Oh. I almost forgot,” I added. “Our office has moved. The address I gave you was for the old address. The new address and phone number is…” and then I gave him my home address and personal cell number.

Again, I heard clicking on the other end of the line as the poor dupe updated my boss’s “new information.” When he was done, he said, “You should get that credit card in the mail by…”, which turned out was today.

So, I swung by my house and checked the mail during lunch. The card was already there. So I went ahead and treated myself to lunch – on the boss, of course. After all, he doesn’t pay me nearly enough for all the excellent work I do for him. And since the boss never opens the mail – especially that particular credit card bill– what he doesn’t know what hurt him.

I wonder what I’ll buy tomorrow… Maybe some new earrings. I’ve always wanted pearls…

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How to Prevent this Kind of Bookkeeper Theft:

You would not believe how incredibly frustrating it is to call into your credit card company and find out that all of your password information has been changed. Not only can your password info be changed, but some people even go so far as to change the “mother’s maiden name” question. Of course, the simplest way to stop this is to catch it early. You can do so by doing the following:

  • Open your credit card statements, or check your transactions online regularly. If anything seems questionable – no matter how small or large – call the credit card company immediately and ask them how many cards they’ve sent out. You can also verify that your security information is still what you originally created.
  • If they tell you your password information has changed, be sure to throw a high holy conniption fit and demand to speak to an account manager or “their boss.” Get this account closed immediately because whoever has your card can still make purchases even while you’re on the line. They will send you a new credit card with a new credit card number within a matter of days.
  • Get copies of your three credit reports as soon as you possibly can because – quite frankly – if your private information has been changed, there’s nothing to keep them from signing up for more credit cards at vendors you may never even have heard of. But, the good news is that every single one of those stolen cards will show up on your credit reports!, but not always all three of the reports, which is why you should spend the extra money to access all three. (In fact, for $14.95 a month at Transunion, you can actually access those three reports and credit scores for free every month. It may be worth it if you ever find yourself a victim of identity fraud.)
  • If a credit card company calls you and says there is questionable activity on your account, get online immediately and see what they are talking about. If they are contacting you, they are probably seeing something they’ve never seen on your account before. So even if you have your credit card on you, it never hurts to double check whatever charges they’re concerned about.
  • And lastly, make sure you know where ALL cards are at all times. I once had a client who ordered a card for his wife – a card which never arrived. It turned out, someone stole it from his mailbox and was shopping with it in the next town and my client never knew. Luckily, I caught it with the very next credit card statement when I asked for receipts that matched the charges, and we realized immediately what had happened. So even though the thief had managed to steal more than $7,000 in 15 short days, my client was not liable for a penny, especially because he disputed the charges right away. (Which is another good reason to check those statements every month.)

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Click Here to read the Previous Entry: Diary of a Bad, Bad Bookkeeper (Day 30) – The Double Payday Scam

Click Here to Read the Next Entry:  Diary of a Bad, Bad Bookkeeper (Day 55) – The Sister Company Scam


Diary of a Bad, Bad Bookkeeper (Day 30) – The Double Payday Scam

Dear Diary,

Today was payday – the second since I’ve been here.  I figured it was about time to test the Double Payday Scam – to see if my boss would actually catch me.

So, I started the day by doing the Payroll.  Just like two weeks ago, I created and took all of the paychecks to the boss to sign.  He signed them, with only the occasional request to see a corresponding timecard…then he signed mine without question.

I took the checks back to my office and set mine aside.  Then, I printed up another paycheck that I took back to him.

“What’s this?” he asked me, glancing briefly at my double payday.

“It’s a replacement check.  I double-checked my income and realized that I had entered my withholdings incorrectly, and QuickBooks took out too much in taxes.  So I voided the other one and reprinted this one.”

“Okay,” he said, shrugging and then signing my check.

And just like that – Double payday.  If he had asked me to produce the voided check, I would have gone back to my office and voided the first check… but since he didn’t, he’ll never know.  Even if he opens the bank statement (which let’s face it, he probably won’t), he’ll see the extra paycheck and think he’s just looked at the same check twice.

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How to Catch the Double Payday Scam:

All a small business owner has to do to catch the Double Payday Scam is to ask to see the voided check, or to insist that you will void all checks personally.  They can then refile the checks, and you have protected yourself… it’s that simple.

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Click Here to Read the previous entry:  Diary of a Bad, Bad Bookkeeper (Day 14) – The Carnage Begins

Click Here to Read the Next Entry:  Diary of a Bad, Bad Bookkeeper (Day 40) – Stealing the Boss’s Identity

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The SpongeBob SquarePants School of Business

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Okay, I have a confession to make:  I am a Mom.  Even worse, I am a Mom with a Toddler.  What that means is that as a “Mom with a Toddler,” I know all the words to “Elmo’s World.”  I also know how to “Do the Pigeon” and that “C is for Cookie” (which is good enough for me).  I know how to read Dora’s map, and I know Hannah Montana’s true identity.

What’s more… I know “who lives in a Pineapple under the sea.”

Why do I know these things, you may wonder?

Well, as any Moms with Toddlers will tell you, having a toddler means having some cartoon playing over and over and over again on the TV.  For a mom, that means no matter how much you try ignore your children or their shows, bits of information tend to sneak into your subconscious until suddenly you’ve realized that you’ve been singing “Absorbent and Yellow and Porous is he…” for the past hour without realizing it.

Which brings me to today’s blog lesson direct from The SpongeBob SquarePants School of Business…

What the Heck Am I Talking About…(Right?)

(Okay, there’s really no such thing as The SpongeBob SquarePants School of Business, but there may as well be.  After all, children all over the world are watching this show and learning from this energetically peppy cartoon.)

Recently, my toddler was watching all 99 episodes of SpongeBob for about the 50th time (give or take a dozen), and I mind-numbingly found myself watching one of the many, many episodes.  Actually, to be precise, I found myself watching Episode 88 (Episode 9 from Season 5) entitled “The Krusty Sponge.”  And as I watched this particular episode, I realized that it was quite brilliant in the very simple business advice it was offering.

The Premise

imageTo give a quick background on “The Krusty Sponge” episode, the mini-story starts when “The Krusty Krab” receives a visit from a food critic.  (The Krusty Krab is the restaurant SpongeBob works at as a “Fry Cook”).  The food critic in the story proceeded to trash everything about “The Krusty Krab” saying it was absolutely terrible…except for the food and the fry cook (SpongeBob).  The food critic then went on to say that if the owner of “The Krusty Krab” was smart, he would “sponge up” as much of what his cook had to offer as possible.

Thus, as cartoon’s tend to do, the business owner (ie, Mr. Krabs) took the advice to heart and went “way too far.”   Mr. Krabs pulled down “The Krusty Krab” sign and replaced it with a sign saying “The Krusty Krab.”  He then added in two new flavors of SpongeBob-themed condiments, a SpongeBob Mascot, a SpongeBob Train, SpongeBob napkins and even SpongeBob hamburger patties.

Eventually, all of these items backfired in a big way, and Mr. Krabs ended up getting arrested and brought before a judge for “poisoning his customers with the bad hamburger patties.”

The Lesson

Now, while I am a big advocate of using a theme in any business, of seeing the bigger picture and adding appropriate merchandise in order to increase profits, I could see right away where this business was about to get into trouble (even if it is only a cartoon business).  The big mistake that the business owner made in this situation was “taking his eyes off the prize.”  It is a common business mistake a lot of business owner’s make without realizing they are doing it.

Here’s what I mean:

imageIn the story, Mr. Krabs got so excited about his new SpongeBob theme, he made one really huge mistake.  He took SpongeBob off the grill and put him on the train.  (In other words, SpongeBob – the prized Fry Cook – was taken out of the kitchen in order to give “the kiddies” a ride on the new SpongeBob train…Mistake # 1.)  Then, Mr. Krabs gave SpongeBob’s kitchen duties to an employee who was unable to run the grill in the same way that SpongeBob could (Mistake # 2).  Finally Mistake # 3, Mr. Krabs sacrificed the quality of the one product that was praiseworthy – the product that brought the customers in.

imageObviously, I am bringing this up for a reason.  This is a common mistake a lot of business owners make in any business industry.  They see some exciting new trend coming along, and they re-vamp their business model to include the cool new product.  They forget about the one (or two or three) products that brought in the customers in the first place, and they end up weakening the overall business structure.  They take the advertising for their prized product and replace it with advertising for the new product.  This can have a negative effect in driving customers away instead of bringing them in – especially if the people looking for the Prized Product are not aware that the business still offers that Prized Product.

Examples

Just to really drive my point home, I will throw out some examples.

  • Imagine if McDonalds changed their fries to a new fry with the skin on.  Or, imagine if they used a different oil that changed the flavor of the fries.  Since McDonalds gives fries with every “Meal Deal,” and the fries are a part of their brand, it could go a long way in hurting their business.  People may start to go over to Burger King instead in order to get fries they are more used to.
  • Jim Carey switching from his classic comic bend to do a movie like “The Majestic.”  (In Hollywood, a move like that can kill an A-list actor’s career… luckily, Carey returned to his usual brand of comedy.)
  • Leonardo DiCaprio stepping back from the Romantic Hero role to pursue the Golden Globe and Oscar awards (meaning he went for the more dramatic and difficult to play roles).  While Leo remains an A-list actor, he no longer has the International Heart Throb status that he had after “Titanic.”
  • Eddie Murphy going from making R-rated movies to G-Rated movies.  It has completely changed the demographic of his customer base (ie, his fans).
  • Roller Derby in the 60’s went from racing and blocking to more violent hits.  Is it really a surprise that the sport died out by the 70’s?  I can honestly say, Roller Derby today is nothing like the original Roller Derby invented back in the 30’s.

Unfortunately, these are the only examples I can think of at the moment, but hopefully, it helps make my point clear.  Taking your eyes off the Prize of your business can really harm your business, or even drive away your clientele.  Learn from Mr. Krabs:  If you’re going to make a change in your business, keep your eyes on the prize.

Diary of a Bad, Bad Bookkeeper: Paypal

Betty Bookkeeper Headshot

Dear Diary,

Betty Bookkeeper HeadshotToday I got an intriguing email.  The email was a confirmation from PayPal.  It said that we had spent $150 on an online order.  Since the company does not have a PayPal account, I knew it was a scam – a Phishing Scam, where some con artist is trying to get access to our account.  When you click on the links in the email, you are taken to a fake PayPal page where you are encouraged to log in and verify the purchase (or deny it), and then the fake website captures your real log in details and the con artist can then empty out your PayPal account.  Any good back office person knows – you never click on links in emails from financial websites (because it’s easy to “cloak” the website links).  You always go directly to the original website and log in there. 

Obviously the PayPal notice was a con…but it got me thinking.  Our company does not have a PayPal account…but we could.  It only takes a few minutes to set up, and then you can make payments from any checking account or credit card account that you link to it. 

So I opened one. 

Then, I went online and made a purchase to Office Depot. 

When I checked the bank balance online, I saw that the payment was debited as a PayPal account to Office Depot.  As far as I’m concerned, the explanation from the bank is simple enough to satisfy the boss.  Now, I don’t need to forge checks unless I really want to. 

Now the only question is…what should I buy

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In this mini story, there are actually two cons I’ve brought up:  The Phishing Scam and The PayPal Weak Link. 

The Phishing Scam is an actual scam where a thief sends a fake email encouraging you to click on the link in the email.  By doing so, they can capture your login information and then clean out your bank accounts.  PayPal Emails are the most common financial cons.  After PayPal, sending emails from banks would be the second most common way con artists get information from their victims.

There are three easy ways to spot these scams: 

  1. Banks and financial institutions have standard, precise emails already created that always use the same verbiage.  Phishing emails, on the other hand, often have misspellings and/or sentences that don’t make sense.  If anything doesn’t seem right with any financial institution’s email, it probably isn’t from your financial institution.   
  2. When you open the email, you will see the “From” address is not necessarily from the financial institution it claims to be from.  Whatever is after the “@” sign is the website address.  Anything in addition to the normal address probably means the email is a scam.  (For example:  …@paypal.fakesite.com or …@fakesite.paypal.alerts.com.)  Both the paypal.fakesite.com and the fakesite.paypal.alerts.com are completely fake because whatever comes before the .com is the site.  That means, these sites would be fakesite.com and alerts.com…not PayPal.com.   
  3. And finally, banks and financial institutions openly encourage customers to NOT click on links from their emails because Phishing Scams are so common.  Instead, they will tell you to go directly to their actual website to log in so that you can verify if the email is from the bank or not (and thus the alert is fake or not). 

Also, it’s common to get emails from banks you don’t even have an account with.  If that happens, obviously you can ignore those…but if you are concerned that an embezzler has opened an account in your name, just print out that email and go down to the bank to see if you have an account or not. 

AND when in doubt – go directly to the source…never click on the links in an email from a Financial Institution. 

As for the second con – The PayPal Weak Link: 

It is very, very easy to open a PayPal account and link it to a checking account…any checking account.  PayPal has a very simple verification process, which means that creating a PayPal account is easy for anyone with access to your checking account information, including your bookkeeper.  From there, it is very easy to steal money because PayPal and the bank account link together in order to create instant money transfers.  Plus, money can be sent to anyone with another PayPal account, and everyone takes PayPal these days (including airlines and other travel agencies), so stealing becomes very easy.

Therefore, to protect yourself from someone linking a PayPal account to YOUR checking account, you need to link it first.  In other words, you need to be the one to create a PayPal account with your checking account.  PayPal only allows a checking account to be linked ONCE, which means no one else can use the checking account information.  Once you have linked it, keep that information to yourself.  There’s no need to share it with your bookkeeper or anyone else because business’s should stick to using Bank Bill Pay and writing checks…Period.  PayPal should only be used by one person…the creator of that account.

Thus, if you don’t have a PayPal account, start one immediately in order to protect your checking account.  If PayPal does NOT let you create a PayPal account, then an embezzler has already linked to your checking account, and you need to consider closing it.  This is one of those huge companies that you just can’t avoid, and you really shouldn’t avoid. 

How to Brand Your Business

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The following is another excerpt from our newest eBook,“How To Start A Lucrative Virtual Bookkeeping Business,” which will be officially launched tomorrow – June 30th, 2010.  I realized that although the book is largely about starting a bookkeeping business, I’ve actually put some of my best business advice in the book as well.  Today is the last day to get it for 50% off, and be entered to win the 8GB iPod Touch, because once it’s launched the price will be $29.90.

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This is the E.T. Barton Brand Logo

In business, branding is putting your mark on everything you own.  Some brands are logos or pictures that are easily recognizable – like the Nike’s checkmark logo.  You see that logo and you immediately think, “running shoes.”  McDonald’s Golden Arches is another recognizable brand.  When you see that logo anywhere in the world, you immediately begin salivating for French fries and a Big Mac.  Some other obvious brands are the AT&T bars, the Wendy’s Fast Food red-haired girl, and the castle in the Disneyland logo.  People just have to see these logos and they know what they are, even if there are no words with that logo.  On the flip side, if you even say the words Disney, AT&T, Nike or McDonalds, those logos immediately pop into your head – largely because the name and logo are branded together.

So in case I’m not being clear enough, branding can be described as a logo, a catch phrase, a song, an environment, a reputation, or even a style, all melded into one solid, memorable element intended to “brand” a company into a customer’s mind.  Its purpose is to generate a feeling or a belief within a customer simply when they come into contact with the business or business product.  When used correctly, it catapults a company into the top echelons of their market.  And when you use it correctly, it can make you the Go-To Business in your area, your industry, and possibly even on the Internet.

Having done my spiel (i.e. monologue) about what branding is, let’s look at what you can do to brand your business, and therefore your product, so that you and your company will become memorable.  You want your brand to cross all channels of branding so that your business really sinks in with your clients.

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Now, if you already have a business name, some of the following information can still be of help to you.  However, if you don’t have a business name yet, consider ALL of the following things as a package before you choose a name.  If you think of the following items as interlinked elements, you will be much more successful at creating a brand then if you “winged it” right from the beginning (i.e. just dove into the deep end while holding your breath).  Here are the things you need to consider as a whole when creating your brand:

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  1. Naming Your Business: What name have you chosen for your business?  Does it relate to your name, your location, or your industry?   Is it an easy name to remember or a difficult one?  Is it easy to spell?  Where will it be located in a phone book or directory?
  2. Choosing a Logo: What image can you select that would represent your chosen business name, your industry, your office location, etc?  What pictures relate to the business name you have chosen?  Is it an attractive logo?  Is it easily recognizable, or does it look like another companies logo?  Is it a standard logo or a custom logo?
  3. Creating a Catch Phrase: Have you ever heard of an Elevator Pitch?  It’s a common phrase in the Mary Kay world, as well as the publishing world, because it’s based on the premise that you have to make an impression on your customer in less than 30 seconds.  You have to spout off something witty, funny, or philosophical in the time it takes to ride an elevator.  Therefore, thing about what phrase, expression, song or rhyme you can come up with and deliver in one sentence (for your business cards and website), or in one elevator ride. 
  4. Selecting a Website or Blog Domain: Is the business name you want available as a website domain name?  Is the domain name easy to spell?  Can you get the “.com” version of the title, or do you have to go with some less popular domain like “.org” or “.net?”  Is there any related names you can choose instead?
  5. Your Email Address and Signature: Once you choose your website, you want your email address to reference that website so that people can easily remember your address if they need to contact you.  For example, ETBarton@OneHourBookkeeper.com is easier for people to remember when finding me then etnsuz@yahoo.com, which is my personal email.  I usually answer people from the etnsuz address because it is my main address, but it is very difficult for people to remember that address, while the first one is much easier.  I’ll admit, it is a difficult name to remember, but when I created etnsuz, I was traveling with my friend Suzanne.  We created ETnSuz together so that anyone we met would remember us as a unit and write to us at one site – a yahoo site.  However, Suzanne never checked the email, and when our travels were over, it became my personal email.  I use etnsuz as my brand across all sorts of social networking sites, even though ETBarton is easier for people to remember.
  6. Your Name or Pen Name: For anyone who’s ever read the “About” section on our website, they know that I like to keep my thumb on the pulse of the publishing industry.  In fact, I am an active member of a national romance writers group (RWA), as well as a board member of my local chapter.  One of the funniest things about being in a romance writer’s group – besides getting to read a lot of kinky love scenes – is the names.  Everyone in the group has a pen name, including me, and some even have multiple pen names.  Obviously for me, my mother did not name me E.T., but Erica.  Yet, in my romance writer’s group, people know me as Talia Clare.  Both E.T. Barton and Talia Clare are brands I am creating for my ideal customers – which are my readers.  I write business articles, credit articles, and bookkeeping articles as E.T. Barton and I publish them in various places on the internet.  I write Historical Romance, Mainstream Romance, and Writing Advice articles as Talia Clare.  I also write my father’s memoirs under Erica Hamilton, my maiden name and his last name.  Therefore, when someone sees how I published any blog I write, they will know exactly what type of article that article is going to be.  In this way, you too can brand your personal name into a pen name or catch phrase of sorts that is easy for your customers to remember.  In the same way, you can use your name or nickname as a marketable brand.
  7. Your Mission Statement: You may think you don’t need a mission statement – and maybe you don’t – but you should at least have a goal in mind for your business.  What exactly is it that you are hoping to do?  Are you simply hoping to make money and be independent?  Or do you have a particular client-type in mind?  Are you looking to make yourself a niche-bookkeeper, someone who works in one particular industry…like construction, retail, restaurants, or maybe for used car lots.  If you can come up with at least one solid sentence that states what you hope to do with your company, you can use that as a part of your brand.

There are many other elements you can use to brand your company, but these 7 are the main ones that are easiest to manipulate.  By combining them together, you can create something memorable that will promote your business to even further success.

Once you do come up with a brand strategy, tell us what your brand is in the comments.  That way, you can inspire other people as well to create a brand that works for them.

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Diary of a Bad, Bad Bookkeeper (Day 55) – The Sister Company Scam

Betty Bookkeeper Headshot

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Dear Diary,

Today I became a business owner.  That’s right, I’ve opened my own business and am about to make a million dollars the easy way – with little or no money down.  Okay – I spent a little money.  But technically, it wasn’t my money.  It was my boss’s money – or maybe I should call him my “investor” – not that he knows he’s an investor.

If only all those companies touting their “make a million dollars without doing any work at all” plans knew how easy it really was… because my way really is the “no work necessary” way.

Anyway… I went down to the courthouse today on my lunch break, a little bit of petty cash in hand.  I registered a new “DBA,” also known as a Fictitious Business Name.  The form only cost $20 and now I have a business name.  The lady behind the counter told me that I would have to run the new business name in the newspaper for 30 days to announce my new business venture, but it can be any newspaper in the county.  I found a small newspaper company that will do it for about $25 for the whole month.  Pretty good deal, huh?

So once I had my Fictitious Business Name document in hand, I went down to the bank and opened up a “business checking account” for $15 a month.  I even went to the same bank as my boss’s bank.  Figured it means less driving around when I have to go the bank for him.  And normally, I wouldn’t pay so much for a checking account, but again, it’s not my money.

So guess what my new company’s name is…

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Well, Diary, you know how I work for “Smith’s Distribution Company”.  I named my company “Smith’s Distinguished Corporation.”  The reason – stealing, of course.  I’ve seen a lot of deposits come across my desk and I noticed a pattern on the [ad#Word Checks].  People tend to write the checks to “Smith’s,” “Smith’s Dist.,” or “Smith’s Dist. Co.”  Seeing all those checks, I suddenly realized that I can totally steal those checks.  Since “Smith’s Distribution Company” is not fully printed on the check, I can put it into my new business checking account and the tellers will assume that the abbreviations on the checks are short for the name of my company.  They’ll probably even assume that the name of my company is just a sister company to my boss’s business.  And unless he goes down to the bank and asks if I have my own business checking account, there’s no real way that he’s going to know what I’m up too.

After work, I actually made my first deposit.  It was a check for $1,200.  See – the experts were right.  You do have to spend money to make money.  All I had to spend was $60 and I made my first $1,200.  This is going to be sweeeeeet!

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How to STOP the Sister Company Scam:

As mentioned above, it’s nearly impossible to know if someone in your company has begun this scam.  You would first have to guess the Sister Company’s name as closely as possible before you can even look it up – although you can try and look it up at your local County Recorder’s Office.  Most likely, you won’t find anything online about the Sister Company because the Embezzler would have to advertise their theft for it to show up in search engines… and there’s no way they’re going to admit to anyone but a diary that they’re a scum-sucking thief.

Now, just because it’s hard to spot the scam, doesn’t mean it’s hard to stop the scam.  The reason this scam happens is because it’s an easy “crime of opportunity.”  It gets by because no one thinks to double check it, then prevent it.  To do this, all you have to do is get an “For Deposit Stamp” (or to put it another way, an Endorsement Stamp).  e

Think about this:  When you go to a large retailer like Target, what do they do with checks?  As soon as the cashier receives the check, they run it through the machine, and the machine prints an endorsement on the back.  That prevents the check from going into any bank account but the one linked to that business.  That’s what a “Deposit Stamp” can do for you.  When you stamp a check on the back with your company name, account number, and the words “For Deposit Only,” the bank will then make sure that check gets into the correct account.  Period.  It’s that simple.  You can also get a stamp for the front of the check that will stamp your company’s full and accurate name, but the best way to prevent this kind of fraud is to get an Endorsement Stamp.  This kind of custom stamp is often $10-$20 at online sites, but I found a deal to get a free stamp at www.iPrint.com – all you pay is Shipping and Handling. That’s a $15 value for $3.49 S&H total. Check it out and get yours today if you don’t already have one: [ad#Button – Free Stamp]

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Click Here to Read the Previous Entry:  Diary of a Bad, Bad Bookkeeper (Day 40) – Stealing the Boss’s Identity

Diary of a Bad, Bad Bookkeeper – (Day 97) The Shell Company Scam

Betty Bookkeeper Headshot

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Dear Diary,

Another day, another dollar…or at least, another stolen dollar.

Well – I’ve had my own company for about two weeks now and I’ve made a couple thousand dollars skimming off the deposits.  The boss hasn’t noticed.  As far as he’s concerned, all of the invoices are paid, and I’m doing my job incredibly well.  In fact, I just passed the three month trial period, and the boss gave me a $0.50 an hour raise.  When he told me that, I felt like saying, “Really?  A whole $0.50 an hour.  You’re too kind.  Now I can buy that car I need.”  But instead, I didn’t.

Still, I do need a new car.  Fifty cents an hour is only an extra $1,040 per year.  That’s not even going to pay for a cup holder.  My car is breaking down and dying in the most inconvenient places, so I really just want to get a new car.  I don’t really need anything fancy, but the best cars are at least $20,000.  I need to figure out how to get a bigger down payment.  I want to put down at least $5,000, but the way things are going, that’s going to take a couple more weeks.  I have no idea if my car can make it a couple more weeks.

I thought about starting another business, but I don’t really want to pay another $100 or so for the licenses…plus, the time it takes to go to the bank and get another account…I’d rather not.

But I did come up with another idea.  I wrote a check to Johnson Hauling for $1,500.

“What’s this check for,” the boss asked me when I gave it to him to sign.  I had been hoping he wouldn’t notice it, since I slipped it in with a bunch of other checks.  But since he had…

“That’s a new vendor we’re using,” I told him.  “We needed to haul away a bunch of left over trash and remnants from the newest renovation project, and they were the best deal.  They delivered a trash can to the project, then hauled it away when they were done.”

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In case I didn’t mention it, the company I work for buys, renovates and sells houses.  So paying $1,500 to haul away remnants was not that uncommon.

“Okay,” he said, distracted as he signed the next check, and then the next.  Finally, he handed me the pile of checks and gave me a dismissive wave of his hand.

I left the office triumphant.  The truth was, I didn’t need to create another company because Johnson Hauling is my husband’s company.  The check that he had just written, I was able to cash at the bank because I’m a signer on the Johnson Hauling bank account.  My husband will never know that I got this money because I can just cash the check.  And the boss has never met my husband, so he has no idea that my husband and I have different last names.  The result… I am now $1,500 closer to buying my new car.

I think I’ll go test drive a Toyota Prius.  It’s a very energy efficient car.  After all, it’s my moral duty to save the planet.

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A Little More Information About This Kind of Scam:

This scam is commonly referred to as a shell company scam because the embezzler is paying a valid company for services that were never rendered or products that were never delivered.  Thus, the company is solid with a banking history while the transaction is nothing but air.  Any teller will cash that check without qualms and hand over the money to whomever’s name is on the account.

This scam is also often pulled when a payment is made to an individual or an employee.  The embezzler’s excuse might be that this person was just a subcontractor for the day and was paid under the table.  Many times, the embezzler will even go so far as to pay someone they are friends with, and then let the friend take a portion of the embezzled funds.  They can steal for a long time this way without getting caught, especially because the owner gets used to seeing that name.

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To Stop This Scam:

It’s important to do your homework.  If you don’t recognize the name of a company, or know anything about the transaction that took place, then ask questions – lots of questions. Ask who ordered the product or services.  Whoever requested the order – sometimes it might be another employee – it’s important to ask them why they placed that order.  Ask to see a Purchase Order, Shipping Receipt, or an Invoice from the company.  Go and look at the service that was done or the product that was delivered.  Talk to someone at the company for which the check is written too and make sure that they actually delivered the product or service.  A good rule of thumb is this… If the payment is for a new account – whether a vendor, employee, subcontractor, or customer – demand proof.  Make contact, or ask for paperwork.

Warning Signs:

  • If someone is colluding with the embezzler to steal from you, they may look you straight in the eye and lie about what they’ve done for your company.  That’s why it’s important to go with your gut when you meet someone.  If you don’t like them, “fire them.”
  • Also, if you ask for paperwork and it doesn’t have an address or phone number, be suspicious.  Valid companies automatically put their contact information on all their paperwork because they want to make sure they get paid – and if you can’t call them with questions, you won’t be paying.  So, ask for the invoice or statement, and be very, very slow at paying anyone you’re suspicious of.  Let them call you and demand payment when in doubt.

How to “Find” Transactions in QuickBooks

This excerpt is from OUR EBOOK: How To Do A Year’s Worth Of Bookkeeping In One Day

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It’s so easy to “accidentally” enter transactions in QuickBooks that sometimes that it can be downright frustrating.  Luckily, it is just as easy to find and correct those mistakes.  To do that – to “Find” Any Transaction in QuickBooks, simply do the following:

  • “Find” the transaction by Pressing Ctrl + F.  This will open the Find screen, which looks like this (in all versions of QuickBooks):

  • Click on the Advanced Tab at the top (shown in red).
  • Select “Amount” in the “Filter” box (shown in orange).
  • Click on the “=” sign in the Amount Area (shown in yellow).
  • Enter the Amount in the box (shown in green).
  • Press Ctrl + Enter (or “Find”).
  • All Matching Transactions will show up in the bottom (as shown in blue).
  • If you see your transaction, double click it to open it.
  • Check to make sure all the information is correct and change anything that is not.  Press Ctrl + Enter to save the transaction.

Once you’ve found the transaction and opened it, all you have to do is change it and then “Save and Close” it.  It’s that simple to change a transaction in QuickBooks.

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Other Excerpts from OUR EBOOK: How To Do A Year’s Worth Of Bookkeeping In One Day

Diary of a Bad, Bad Bookkeeper: (Day 149) The Collusion Scam

Betty Bookkeeper Headshot

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Dear Diary,

Today was a not-so-great day.  Apparently, I have a partner now.  I never intended to have a partner, but it appears I have no choice in the matter.  Here’s what happened:

I was in my office (innocently shredding checks), when I suddenly heard a man say, “I know what you’re doing.”

Quickly slipping the leftover checks back into my desk drawer, I looked at him with my most innocent expression.  “What do you mean?” I asked sweetly.  It was Ernie, one of the flooring installers that handled the bigger clients.  He was considered the boss’s second-hand man.  “What do you think I’m doing?”

“You’re destroying the evidence.”

Crap.  How did he know? But I decided to play it cool.  “What evidence?” I scoffed.  “I don’t know what you’re talking about.”

“Those checks you’re shredding are the checks you’ve forged.  Am I right?”

“Why would you say that?” I demanded, pretending to be affronted.

“Because I’ve seen all the signs before.  The new car…the fancy clothes.  You order lunch all the time instead of bringing it from home like the rest of us do.”  He glanced down the hall behind him, then stepped into my office, lowering his voice as he did.  “I know what you’re doing…and I want in.”

In?  Was he nuts? “I don’t know what you’re talking about.”

“Yeah, you do.  And you can either cut me in, or I’ll rat you out.”

Cold chills ran up and down my spine, and my palms were actually sweating.  I could tell by the smug look on his face that he knew he had me between a rock and a hard place.

“Look,” he continued, propping himself onto the edge of my desk and leaning toward me.  “You don’t have to tell me everything you’re doing.  I don’t really care.  I just want a piece of the action.  And I have the perfect way to do it.”

I narrowed my eyes.  “Oh yeah.  What’s that?” I asked.

“Simple.  I have a friend that runs his own construction company and can get us plenty of jobs.  You cut some checks to his company with an additional amount of money, and he’ll pay the rest of the money back to us.  The boss won’t ask questions because he’ll be able to see that the work is getting done, and we can make a tidy sum on the side.  So what do you say?  Should I call my friend?  Or should I call the boss?”

“The boss won’t believe you.  He trusts me 100%.”

“He trusted his last bookkeeper too – until I accused her of a few things.  And I’ve been here for seven years.  Who do you think he’s gonna believe?”

And just like that, I had a new partner.  But at least if we’re both stealing, he can’t accuse me of anything without me making a few accusations back.  I won’t be going down alone if he decides to betray me.

On the plus side, it is a quid pro quo situation. I help him make a little extra money, and he gets me new carpeting in my entire house.  I think I want purple…

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How to Stop the Collusion Scam:

Spotting and stopping the Collusion Scam is really difficult.  For one thing, the invoices that the bookkeeper receives will match the checks going out.  That makes embezzlement even more difficult for an auditor (or auditing accountant) to find because there’s legitimate backup and everything appears to be “on the up and up.”  For another thing, the money being paid out will not have your bookkeeper’s name on it, and the money they’ll be taking home will be coming from one or many of their colluding partners.

Therefore, to spot and stop this scam, you need to trust your gut.  Pay attention to who is hanging out in your bookkeeper’s office.  Most bookkeeping positions involve staring at a computer all day, and if someone is spending more time than necessary or usual, take note.  Begin observing that employee as well and see who they recommend as “work associates.”  Keep an eye out for how many checks they receive each month, and if those payments seem a bit high.  Also, look for signs that those employees are spending more money than they’re making.  Oftentimes, an employee’s spouse will make a lot more money than the employee, but there will be a consistent spending pattern if that is the case.  It’s the sudden changes you want to look for.

Also, since one of the easiest ways to stop embezzlement is to be the only person who opens bank statements as they come in, you want to keep an extra watchful eye out for checks to vendors or customers that also seem “a little too high.”  If you feel like a company is making too much money for various projects…shop around.  Call that company’s competitors and see what they would charge.  And stay open to switching vendors.  Because the truth is – you never know when someone is going to decide to steal from you…”by any means necessary.”

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