I just took a week off customer work to get our accounts up to date. It wasn’t what I wanted to do this week but I really didn’t have a choice and it made me realise a lot about organisation. I am a VERY organised person normally, I like to keep everything (including my accounts) really simple and up to date. However businesses being as they are, ours never really stood a chance and looking at them was enough to draw a tear to my eye. They were like a complete disaster zone with tonnes of random non- work related expenses running through the company, deposits that didn’t match any invoices, shortcuts that were taken when we were cash poor, all sorts of things that should never have been done and that caused me to waste a week of my life to sort out.

Since I took over the company, I have set everything up afresh to start from scratch so I can leave behind all our legacy mistakes and go forward in a clean, organised way. I’ve got a new bank account, new accountant, new accounts for most things and am ensuring from now on, it’s all done properly. It made me start thinking about people who were just starting up and advice I would give them to get set up.

Get business bank accounts – and USE THEM

DO IT! Don’t start using your personal cards or use a combination. Get one credit card, one eftpos account and one savings account. DO NOT USE ANY OF THESE FOR ANY OTHER REASON THAN BUSINESS. Use your savings account to hold your GST payments based on your monthly accounts so that you never get a fright when it comes to paying it.

Choose a good bank and LIKE YOUR BANK MANAGER. They are there to help and should help (I love mine). Choose a good bank too. I like National Bank because they have a series of talks and seminars tailored to small businesses and also because I like my bank manager.

Get an accounting package

Sign up for an accounting system immediately. I use Xero and although it’s still pretty new, it is definitely getting very slick. Once you have your accounting system, do your accounts weekly. It’s just not worth getting behind, you lose money and waste time. Having your accounts permanently up to date also helps you plan and forecast and see when you may have quiet times and when you may need to look at boosting your sales. Spending a couple of hours a week saves you an entire week later and means you ALWAYS know what shape your business is in.

Talk to the IRD

I didn’t know this, but turns out when ou start a business, you can get someone from the IRD to come and chat to you and explain what your responsibilities are and walk you through our tax system in NZ. It’s a free service so why not? I spent years utterly confused about quite simple stuff because I never took an hour out of my day to sit down with someone and have it all explained.

You can then happily set up your GST payments (GO 2 MONTHLY – if you pretend you can sort yourself out enough to pay every 6 months you are lying to yourself, I know you could be earning interest on that money, but it’s just not worth it.

Get an accountant you like and trust

I’ve known my new accountant for a long time and while the old ones were good (and the main reason for leaving them was to simply have a clean break) it’s quite different having an accountant who you know REALLY cares about your business and who actively offers advice for how to save money, simplify your business and ensure you are not paying too much tax and whos first question is always “how is it all going?”

I would also recommend getting an accounts person who you pay a lot less to help you with your weekly accounts. Initially it’s a good idea to sort them out yourself so you know what you’re doing, but after a while, you are best sticking to what you do best and let someone else sort your financial side and just look at the results.

Get to know a good lawyer

Especially if you are getting into business with someone else (regardless of how well you think you know them) You save heaps of time and money later on if you get the simple stuff sorted initially. Once again, get one you trust and who cares about you (I know it sounds weird but small business is VERY different from big business and work becomes personal and you need to know their top priority is minimising your stress levels). I know when everything is exciting at the start getting all legal on each other seems a bit of a downer, but I know so many examples of people missing the simple stuff and it all ending in tears.

Use iPayroll

Sorry everyone who doesn’t live in NZ, but this is the best online tool I’ve ever found. Actually it’s not even the online tool part. Please overlook the ugly interface and kind of awkward usability (What I’d give to get my hands on it and sort it out!!!), within half an hour of signing up, I received a PHONE CALL from their sales person and am now meeting with them on Monday to run through how it all works. Basically for $9 a week, you enter your timesheets and they do EVERYTHING ELSE from calculating holiday pay to filing your PAYE reports. That’s like the best $9 you’ll ever spend.

The other reason is so that you don’t end up like us and have a year’s worth of overdue PAYE. Just get it sorted from day one, it’s uber simple.

Keep ALL your receipts in a folder

Don’t throw them all in one big box or anything, you often need to access old invoices and receipts especially when you live in New Zealand and both our cellphone companies make dodgy phones that break every 5 minutes. Keep one file for every month. It’s also cleaner and tidier and gives you a zen feeling or organisation.

Get employment contracts for employees

Once again, at the beginning it seems silly, at the end it doesn’t. This gives everyone security and means everything is outlined and everyone is on the same page regarding job descriptions etc.

Which reminds me, stick to your job descriptions. I know small business require a lot of flexibility, but if you hire someone for one reason, don’t start them doing other stuff. They do not own the business and they are there to further their career, not do your odd jobs.

That’s about it for today :) PHEW!