Bobby Kerr’s Clever Business Tips

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Business Agony Uncle, Bobby Kerr is back with some more expert advice for SME employers and employees. This week it’s all about getting to grips with business accounts and how to keep on top of finances. Bobby also advises on how to potentially seek assistance with funding for volunteer organisations.
 
Accounting for Every Eventuality 

First up this week is Janet, who runs a pub/restaurant in West Waterford. Janet recently received her financial information and was devastated to see that the business while having a growth margin of 50%, she had actually lost money between June to August, which is the busiest time of year for the business. She had no idea this was the case and was shocked as they had appeared to be very busy during the summer months. She is extremely disappointed and has asked Bobby for some much needed advice on how to ensure this does not happen going forward.
 
Bobby’s Advice
This is quite a common occurrence and happens fairly regularly, especially within the service industry. It’s never nice to see your business making a loss, particularly when there has obviously been so much hard work put in to it. Janet is obviously extremely good at what she does and was so focused on providing the best quality service that she lost sight of the finances a little bit.
Janet needs to forget about last summer, and take learnings from it for this year. There are a number of key steps to take:
  1. Janet needs to look at everything she sells, and go through everything meticulously. As painful as this may be, it is extremely important to record a cost price and selling price for each item.
  2. Weekly stocktaking – Janet needs to start weekly accounts for opening and closing stock, weekly sales and VAT as well as all purchases and direct expenses. This will allow Janet to forecast and plan for future business on a week-to-week basis.
  3. Janet needs to work more closely with her accountant and seek regular reporting for all incomings and outgoings. Transparent financial information is absolutely crucial to running a successful business, and once Janet gets to grips with the basics, on a weekly basis, this will set her up to be able to forecast her finances and future activity to avoid similar circumstances.
 
Support for Volunteers – Where to Go

Next up is a teacher who runs free summer camps during their time off. The camp is located in what would be known as a socially deprived area, however it is becoming increasingly popular among the local community. This person has asked if it is possible to get a licence for a commercial vehicle, even though they are not technically running a business. Costs associated with transport and logistics are increasing and they are worried that this might threaten the running of the summer camps which are so important to the community.
 
Bobby’s Advice
This person needs to be commended on their ambition, and their desire to give back to the local community. It is a fantastic attribute to possess and we need more people like this in society. Unfortunately, it is unlikely that they will be able to obtain a commercial vehicle license due to charitable nature of the activity and the fact that there is no income to offset costs against. There are however, a number of alternative sources that they can seek for advice or for funding for the summer camps:
  1. Dept. of Education or Social Welfare may be able to provide some assistance but they will need to follow up with them directly to find out more information. As they are providing a service for the community there may be a scheme or fund available.
  2. Local Community – It is worth considering having a local fundraising initiative or events to generate funding for the camp. This could be done through a number of ways.
  3. They could potentially create a webpage for donations.
As they do not run a Ltd. company there is no VAT being applied and so would not qualify for a commercial vehicle or license. I wish them the best of luck with everything and hope that they secure funding soon for such a great initiative.

If you have a business or SME related query you would like answered - you can get in touch with Bobby each week by simply sending a short mail to [email protected]
 

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