June 2019

EMPLOYEE RELATIONS BEST PRACTICES

Are You Building a Fact or Fiction?

Small-Business Myths
Championship Team? Debunked
Because great teams are goal-oriented and imbued with a sense of purpose, Not all advice is good advice. To succeed,
team-building needs to be a holistic process. entrepreneurs must discern what counsel is
The first step is to choose team members who can and will contribute in sound and what is pure fiction. Following are
meaningful ways to the team’s overall success. Once the team is in place, as three of the most common myths that can lead
team leader, you need to delineate the roles and responsibilities so that small-business owners astray.
individuals know that their jobs matter and that they bring something unique Tax myth: Topping the list of management
and essential to the table. mythology is the notion of increased spending
Next, set clear, realistic short-term and long-term goals, and establish milestones to reduce taxes. It’s true that the timing of
and deadlines. Motivate progress toward the goals with positive reinforcement, expenditures sometimes yields beneficial tax
but also know when to pivot or course-correct if necessary. consequences. But this does not mean that
unnecessary costs are a good idea simply
Provide continuous feedback and maintain open channels of communication. because they’re tax deductible. Especially
Communication fosters engagement and commitment to the team’s success and disastrous is borrowing to pay for things that
also enables team members to surface ideas, suggestions, and issues that may don’t add to business productivity. Burning
lead to a more productive workflow. $1,000 to obtain a $300 tax deduction simply
Celebrate successes and accomplishments, but also acknowledge problems, results in a $700 net cost.
setbacks, or concerns. This type of candor conveys the importance of working Image myth: Some people encourage
together and reaffirms each individual’s responsibility to contribute to the frivolous spending on things the customers
team’s success. never see. For instance, retail stores need
Ultimately, it takes vision and strong leadership to create and sustain a high- visible locations with plenty of parking, but a
performance team. As a leader, you will have to make difficult decisions, fancy office suite will not impress clients who
establish standards of performance, and implement corrective action from time interact with a business remotely. In addition,
to time. Be aware of your leadership style and techniques. Get to know the despite the importance of reliable
people you work with so that you can have constructive discussions and lead transportation to jobsites or a decent car for
your team to achieve the best outcomes. client meetings, frequent upgrading to the
latest model is wasteful. Remember, image
cannot replace performance.
Payroll myth: Perhaps the most important
myth to dispel is that you should always
reinvest in your business before paying
yourself. Instead, focus on operating a
profitable business. If you have invested the
right amount to launch the enterprise, it
should provide some amount of compensation
for your work. Always plan to pay yourself
Carry yourself like a champion something first and expand with what’s left. If
now so when you get there, it’s you aren’t getting paid for running a
not a surprise. profitable operation, you’re only reinvesting
in an unprofitable endeavor.
David Fizdale.

Page 1
HOT BIZ TRENDS

Customer Reviews Are Crucial;

Here’s How to Get Good Ones GOSSIP!

These days, customer reviews can make
or break a small business. This means
you need to actively encourage your
satisfied customers to share their
experiences with your company online.
Here are some tips to get you started:
Social Media
Make sure you have a presence on all
major social media sites that are
relevant to your business. Start with
Google, Facebook, and Yelp. Then
consider Bing, Angie’s List, LinkedIn,
Yahoo, TripAdvisor, CitySearch, and
others.
Feedback
Ask your customers to give feedback.
As long as you deliver as promised on
your product or service, they won’t
mind if you ask for a review. Don’t wait
too long, though. Customers are more
likely to provide feedback right away.
Follow-Up
Whenever possible, follow up your
initial request with a reminder email
containing links to suggested review
sites. And anytime customers
compliment you in person or via phone
or email, ask them to post their Thank
feedback online. you for making SHRED DAY a
Convenience success! We had a lot of
Make it easy for your customers. Put positive feedback and hope to
direct links to your review profiles in do another one this fall!!!
multiple places, such as in emails, in
newsletters, and on your website.
Incentives
It’s okay to incent, but not buy, reviews.
You might offer your customers a
bonus or reward of some kind, but be
sure all reviews are authentic.
Review
Make sure your employees understand We like to
the importance of soliciting reviews congratulate all the
from their customers, and be sure to
monitor the reviews. You need to know graduates whether its pre-
what is being said about your business school or college it’s a job
and where you may need to improve
your level of service. well done!!!

Welcome New Clients and Thank you for Referring

We love giving recognition to our new friends and our wonderful existing clients who are kind
enough to refer their friends and relatives to us! We are all helping each other, which is the
whole point. In the last month we were fortunate to welcome 53 new tax clients and 8 new
business clients. They became members of our firm’s accounting and financial planning family.
We’d like to welcome them and thank all the people who have referred business to us. Surveys, surveys, surveys, it seems
like every time you turn around
As you may know, marketing for new clients costs a great deal of money, time and energy. We,
like any business, need to get new clients to stay in business. Over the years, we have found that
someone would like you to take a
marketing takes away from the time we would rather be spending with you. We have learned survey. This was the first time we
that by encouraging you to refer your friends and relatives to us works for all of us. We help have ever done anything like that.
you, and you help us. Thank you. It has really helped us! We are
grateful to all of you who took the
time out of your busy schedules and
did our survey!
Feedback is the breakfast of
champions.
Ken Blanchard

Page 2
ACCOUNTING

Financing a Purchase? Follow These Accounting

Basics
Accounting for financed asset purchases account on your business Balance Sheet Financing Formalities
is likely the most complicated
bookkeeping procedure to untangle.
Where should you start? To avoid
missing vital details in your books, you
must record the entire cost of an asset,
including the part you pay in the future
as loan payments. This allows you to
deduct asset costs appropriately and
sidestep future errors when recording
loan payments.
Use the following procedures to keep
your books in order.
Lingering Liability
Loan payments do not belong on your
Income Statement, which includes
revenue and expenses. Repayment of
loan principal applies to a liability on
the Balance Sheet. Only the interest
portion of a loan payment is recorded
on the Income Statement as an expense.
For this structure to function correctly,
the loan liability must appear on the
Balance Sheet when the money is
initially borrowed. Without this
element, you have no Balance Sheet
liability to reduce as the loan principal
is repaid.
Judicious accounting of your loan
payments ensures that the liability
precisely matches the lender’s record of
Cash that leaves the business bank
what you owe. Periodically reconciling
account for a purchase is recorded as
the loan balance on your books to a
either an expense on the Income
report from the lender is as essential as
Statement or a capitalized asset on
reconciling your checking account
the Balance Sheet. Accounting
balance to a monthly statement from the
software automatically deploys this
bank.
double-entry process.
Capitalized Curiosities
Since capitalized costs are typically
Most costs of doing business are larger than ordinary expenses, their
recorded as expenses on the Income purchase often involves borrowed
Statement. However, a capitalized cost money. Funding from a lender must
is a special exception. be identified along with the amount
spent by the business. Paying a
Capitalized costs are assets such as
capitalized cost with borrowed
equipment, furniture, machinery,
money does not change the amount
buildings, and improvements to rented
paid for the asset. You depreciate the
business space. Some of these items,
total cost, regardless of how much
however, may cost so little that they are
company cash is spent at the time of
accounted for as expenses. Rely on your
purchase.
tax accountant to determine the cost
threshold that requires you to capitalize Journal entries are used with
a purchase. computer bookkeeping programs to
record the full cost for a capitalized
Capitalized costs are recorded in an
asset along with the borrowed part of
account on the Balance Sheet. The
that purchase, which creates a new
amount spent is deducted over time as
liability. Consequently, business
depreciation. When this happens, your
owners must provide bookkeepers
financial statements simultaneously
with all the information about the
document depreciation expense on the
cost for an asset purchase and any
Income Statement and a reduction of
loans incurred to buy it. This will
capital costs on the Balance Sheet.
allow for accurate accounting of your
financed purchase.

HOW WELL DO YOU KNOW YOUR CUSTOMERS???

Quick Quiz
You can learn a great deal about your customers simply by talking with them. Don’t be afraid to
call, email, or approach customers or prospective customers and engage with them about what Each month I’ll give you a new
they're buying or planning to buy in the future and what’s important to them about the purchasing question.
experience.
Just email me at
Probe deeply to understand why and when they buy certain things, what they expect from you Lisa@cpcfinancial.com or call 610-
and your company, and what unmet needs they have that your business might fulfill. Their 265-4122 for the answer.
purchasing motivations may be related to pricing, convenience, selection, timing, or levels of
service or it may be something you haven’t even considered. This month’s question:
Find out what brings top customers back again and again, what brings occasional customers in, How can you salvage a cake that is
and what prompts new customers to give your business a try. Be sure to ask people what they stuck to the bottom of the pan?
know and think about your competitors and why they might choose to purchase either from you
or from another company. Inquire about what competitors may be doing to attract or reward
customers and stay ahead of trends.
If yours is a B2B business, get to know whoever is responsible for the decision to buy your
products or services, and be familiar with the company’s procurement processes and protocols.
If you know what drives your customers and the challenges facing them, you can address their
needs and offer them solutions. Conducting your own market research can be as simple as just
chatting with them.

Page 3
Clairmont, Paciello & Co., PC
250 Tanglewood Lane,
King Of Prussia PA 19406

BUSINESS DEVELOPMENT

How to Create a Successful Business Plan

The prospect of writing a business plan
can be overwhelming for a would-be
entrepreneur. It is a time-consuming and
laborious exercise, and it requires that
you intimately know and understand
your business, your product or service,
your competition, and the market.
Is it really worth the effort?
Yes. Beyond helping you obtain a bank
loan or financing from investors, a
business plan serves as a road map to
guide you through the start-up, growth,
and expansion phases of your business.
A comprehensive business plan sets
forth a vision for your company and
outlines how you intend to realize that
vision.
The US Small Business Administration
recommends that business plans include
an executive summary, a company
description, a mission statement, a
description of products and/or services,
a market analysis, an outline of the
business’s proposed organizational and
management structure, a detailed
financial analysis, and a succinct
description of the short- and long-term
goals of the business.
Another key component of a good
business plan is a strategic marketing
plan. Your marketing plan should
include detailed sales objectives and
marketing strategies as well as plans for
bought and earned PR, an optimized
website, targeted online advertising,
social media marketing, pricing,
promotions, and proposed conversion
techniques.
The marketing plan should also include
data about your target market, budgetary
and cash flow projections, operational
plans and contingencies, growth
milestones, ways of measuring progress,
and other details, such as licensing
agreements.
A business plan is a living document
that can help guide future business
decisions and keep your business
relevant over time. You may need to
modify your plan as the business grows
and/or as the market evolves. Whether
you’re sharing it with investors,
potential joint venture partners, or board
members, it needs to show that you’re
committed, passionate, and dedicated to
the success of your business.

This newsletter and any information contained herein are intended for general informational purposes only and should not be construed as
legal, financial or medical advice. The publisher takes great efforts to ensure the accuracy of information contained in this newsletter.
However, we will not be responsible at any time for any errors or omissions or any damages, howsoever caused, that result from its use. Seek
competent professional advice and/or legal counsel with respect to any matter discussed or published in this newsletter.