Time Tracking

Keeping track of how you and your workers spend time is one of the most important things you can do in your business. Labor costs can be a large portion of expenses, and understanding how time is spent can help you manage your business better in a multitude of ways.

Benefits of Time Tracking

There are many reasons and benefits to track time:

If you price by the hour, time tracking is mandatory, because without it, you won’t be able to invoice your clients accurately.
Tracking time helps managers understand how long a task should take, where employees may need training, and where processes and procedures may need improving.
Information on time reports can be fed into a project management system and reviewed to make better fixed fee pricing estimates on future jobs and customer proposals.
Time tracking feeds into job costing for construction companies.
For manufacturing businesses, time tracking feeds into labor reports.
Time tracking is used in payroll systems to pay hourly workers accurately.
Time tracking can increase accountability among workers as they become more aware of how they spend their working time.
When time is budgeted in advance, actual hours worked can be compared to see how the budget is used and whether it was too much or too little.
Time tracking allows managers and business owners to determine when they need to hire additional staff because the backlog has become too large.

What Is Time Tracking?

Time tracking is the recording of how you spend your time. You can use paper, a spreadsheet, or time tracking software to log the task you are working on and the length of time you worked on it. For example, here’s a simplistic example of a time log, or timesheet, for one day:

Employees may be required to complete timesheets on a daily or weekly basis, which are then turned into their managers and payroll administrators.

Managers can take time tracking to the next level by adding hourly payroll costs as well as the employee’s hourly billing rate to gain insight into further time-tracking financial metrics.

Time Tracking Software

There are many different types of time-tracking software:

A time clock allows employees to “punch in” when they arrive for work and “punch out” when they leave. This type of machine is mostly used for payroll in a manufacturing setting.
Time tracking applications allow workers with computers to enter their time via the application. In some cases, workers can enter their time via a mobile device.
Some companies will have their time tracking function embedded into their project management, job costing, or billing system. Employees would then enter their time via those applications.

Getting Employees on Board with Time Tracking

Reporting your hours in a time-tracking system is one of the least favorite tasks of employees and requires an education in mindset and attitude more than any software instructions. It’s important that your employees do not feel like you will be “Big Brother” when it comes to using their time data.

For best results, let employees know how the timesheet data will be used. Allay their fears that they will not get fired or in trouble if they feel something “took too long,” which can often translate into an employee “fudging” their hours on a task where they might have made a mistake. Make sure they know they won’t be penalized in any way for what they report.

Communication is key in getting employees to report their time accurately so that managers and owners can receive meaningful information. Have managers tie time tracking to an employee’s personal career goals to increase adoption and reduce resistance.

Personal Time Tracking

Time is our most precious commodity, and tracking your personal time can give you insights into how you are investing in yourself. Some really interesting questions can be considered when you have some time data for yourself.

How much “downtime” do you need each day?
How much time are you spending on your life goals?
Are you spending time on what you consider to be important?

Getting Started with Time Tracking

If you’re considering time tracking or would like to take your current time-tracking function to the next level, please reach out. We may be able to help with integration, implementation, the accounting aspect of time-tracking, and financial metrics and reports.

Cool Apps: Chatbots

In the last year, chatbots have exploded. A chatbot, short for chat robot, uses artificial intelligence to imitate a conversation with people. One place they have exploded is the Facebook Messenger app, which is a free instant messaging platform.

To get Facebook Messenger, you can download the app on your smartphone or go to https://www.messenger.com on your PC or Mac in any browser.

In Messenger, a chatbot looks just like a person. All you need to do to connect to a chatbot is to go to the People section and enter the name of the bot you want to connect with. Typically, there will be a Get Started button. The bot may ask you some setup questions such as your time zone, city, or topic preferences.

Bots can do many things. There are bots to deliver the news daily (Chat Newswire), bots that entertain and play games, bots that help you find recipes and restaurants, bots that improve your productivity, bots that help kids with their homework (Christopher Bot), and even a bot that connects with QuickBooks (Freelanzr).

Each bot works a little differently. In general, you will receive a welcome message, then the conversation will begin. The bot will prompt you to ask a question, enter a phrase or a word, or select from a group of horizontal button choices.

Bots are useful for your daily routine. You can get daily news, weather, reminders, and tips. If you are stuck standing in line somewhere, riding public transportation, in an Uber or taxi, or experiencing other downtime, you can have several conversations with your bots to pass the time.

If you don’t know of any bots or wonder about a bot that does a specific thing, there are lots of bot directories available. To get you started, here is one bot list: https://botlist.co/.

The cool part is you can design your own bot for your business which can be fun for customers. The Facebook Messenger platform is open, and you can find out more about how to create a bot here: https://messengerplatform.fb.com/.

There are more platforms for chatbots besides Facebook Messenger, including Twitter, Android, Slack, and Amazon Echo, to name a few that you can explore if you don’t care for Messenger or Facebook.

It’s still early for bots. The effectiveness of the bots depends on how well they are designed as well as how much time the user spends learning how to work with the bot. Try connecting with a couple of bots to see if they will be productive for you. If nothing else, your kids will love the game bots while they are standing in line with you.

Do You Have Past Due Accounts?

If you perform a service or ship a product before you get paid, then you likely have a balance in your Accounts Receivable account. If customers pay when their invoice is due, all is right with the world. If they don’t, then your cash flow slows down and your bank balance is not as high as it should be. Here are some tips, preventive and supportive, to help you keep your accounts receivable current.

Granting Credit

When you deliver your service or product before your client pays you, you are in effect their “bank,” granting them credit. Not everyone deserves to be granted credit. Consider running credit checks, especially if you are billing large amounts of money for your sized business.

You may also want to ask for a retainer or deposit prior to starting work or shipping your products. This will smooth your cash flow and reduce your credit risk.

Offer Multiple Payment Options

When a customer is ready to pay their bill, make it easy on them by offering multiple payment options. Perhaps they will pay faster if you take payment by credit cards. Many people have extra money sitting in their PayPal accounts, so that is another payment option. Apple Pay and Android Pay are relatively recent options to consider adding.

You may also want to revisit the credit cards you offer: MasterCard, Visa, and American Express are universal, but many places also take Discover and Diners Club. If you are doing international business, consider JCB (Japan), China UnionPay, and RuPay (India).

Collection Process

Once an unpaid invoice has reached its 90-day mark, the chances of collecting it are about 50 percent. This means that you will need to put some aggressive collection processes in place prior to the 90-day mark.

If the invoice is due in 30 days, start at the 35- to 40-day mark with a friendly reminder. At 60 days, your customer needs a strong reminder and perhaps a phone call. At 75 days, they need to know what consequences there will be for not paying. Will you report the customer debt to credit agencies? Will you turn the account over to a collection agency?

At 90 days, it’s probably a good idea to make one final collection effort and then turn it over to a collection agency. It might sound too soon, but the odds of collecting something much older go down significantly as time passes.

At any rate, create your own process, and automate it as much as possible. The main thing is to stay on top of it.

Past Due Accounts

From how you first engage with your clients to the last steps in the collection process, there are many cost-effective techniques to avoid past due accounts and the unpleasantness that goes with them for both parties. If this is an issue in your business, try these ideas above and reach out if you’d like our help.

Eight Ways to Increase Your Profits

Increasing your profits might sound like it’s an unattainable dream just out of your reach. But there are a finite number of ways that profits can be increased. Once you understand what they are, you’ll have clarity on how to best reach your goals.

There are two primary ways to increase profits:

Raise revenue
Lower expenses

That’s not particularly enlightening or instructional, is it? Let’s look at the four ways you can increase revenues and the four ways you can reduce expenses to get clearer on what actions we can take.

Four Ways to Increase Revenue

1. Raise prices

The easiest way to raise revenue is to simply raise prices. However, this is not foolproof and assumes you’ll be able to maintain the volume of sales you’ve achieved in the past.

This method is also limited by market demand, what your customers are willing to pay.

2. Add new customers

Adding new customers is what most entrepreneurs think about when raising revenue. Increasing your marketing or adding new marketing methods is typically the way to add new customers.

Another related option is to work hard to keep the customers you already have. You can also potentially contact the customers you lost and ask them to come back.

3. Introduce new products or services

For some companies, your products and services are changing every year. For others, not so much. To increase revenue, consider adding new products or services that will bring in an additional revenue stream that you didn’t have before.

Even if your products are changing every year, you can consider adding something completely different that your customer base would love. For example, a hair salon could add a nail desk, a clothing store could add handbags or shoes, a grocery store could add a coffee bar, a restaurant could add catering, a landscaper could add hardscaping, and so on.

4. Acquisition

The final way a business can increase revenue is to acquire another business in a merger or acquisition.

Four Ways to Reduce Expenses

1. Negotiate for a better deal with vendors

If you’ve been working with a vendor for a while, you may be able to re-negotiate your contract with them. This is especially common with telecom companies. Call you phone provider and ask them for the latest deal. They always favor new customers over long term customers, but they don’t want to lose customers either. Just calling them usually yields a better price than what you are paying now.

2. Change vendors

If a vendor has gotten too expensive, it might be time to look for a new vendor. Health care insurance seems to be in this category. Often, changing providers will lower your costs.

3. Cut headcount

If there is not enough work to support your employees or not enough cash flow to pay them, then it might be time for a layoff or restructuring. You might also consider outsourcing a function that you previously did in-house.

4. Cut the expense or reduce services

It might be your business no longer needs to spend money on an expense. Perhaps this expense has been automated. In this case, it’s an easy decision to cut the expense out entirely.

Those are the eight ways to increase profits. Which one makes the most sense in your business? Create a plan around these eight ideas to boost your profit in 2017, and let us know if we can help.

Five Ways to Add Pizzazz to Your Customer Service

It’s the little things that add up to make an exceptional experience for your customers. Here are five “little things” you can add to your services to create an exponentially memorable connection with your customers.

Generosity

Add a little extra something to the products or services you offer. It could be a piece of chocolate like Hershey’s® Kisses®. It might be a handwritten thank you note. It could be a coupon for their next visit. It could be a bottle of water.

These little additions pack a huge wallop for the customer experience. And none of them cost a lot to implement (unless you eat all the Hershey’s® candies yourself). Think of what you can add to your customer experience so that the customer sees you as generous and caring.

Speed

Many customers value their time, and adding speed to your service will be appreciated. When customers call in or email you for a service question, how fast do you respond?

Set response time goals for you and your employees to respond to customer issues and questions. You might choose one minute, four hours, or one day for response time, depending on your business. Make sure customer emails are answered first, and have someone monitoring the phone during business hours.

Track your results and reward your speediest employees.

Acknowledge and Apologize

Sometimes things go wrong, and an apology to the customer is in order. In most cases, customers simply want to be heard, so your listening skills are your best asset at that moment.

As an entrepreneur, the buck stops with you. Even though it might not have been your fault, it’s sometimes a good idea to simply apologize in the sincerest way possible. If there’s something that needs to be done to make it right, go overboard. Give the refund, take the loss, and let the customer win.

Positive Communications

How you word things can make all the difference. Which sounds nicer?

“That item is out of stock and won’t be in for six weeks.”

“We will have that item in stock in six weeks.”

The first sentence has two negatives (out of stock and won’t), while the second sentence is positive. It avoids the negative wording.

It’s a small but powerful change in the customer experience. Think about how you can word your communications so that there are more positive words and fewer negative words when speaking with customers.

Your Full Attention

Although you want to respond to customer issues with speed as mentioned above, while you are working with the customer, take time to slow down and really engage with the person. Our world is so fast, and some companies even reward multi-tasking, but no customer appreciates interruptions when being helped.

When you are with a customer, even on a phone call, be with the customer. Avoid interruptions and distractions, and give them your full attention. It’s the most powerful thing on this list. Treat them as a real person, not just another figure, and the customer will notice.

Try one or more of these five customer service boosts to take your customer service experience to the next level.

The Death of the Annual Performance Review

If you have employees, you probably also have a process to help them understand how they are doing on their job performance. There’s a new trend in large companies to kill the annual performance review and replace it with continuous, instant feedback as well as a tool called an after-action review.

After-Action Review

An after-action review (AAR) is a fantastic process to help you look back at a project or period of your business to see what, why, and how things occurred and how they can be improved for the future. Taking a profit-focused view will help you get the most out of the idea.

The AAR provides you with a bit more formal process than a passing “hmm, how did we do on that project last month?” conversation in the hall. For example, if you planned your client retention rate to be 90 percent and your rate was 85 percent, you may want to take a look at why that happened. Doing exit interviews or a survey with discontinuing clients can help to explain the five percent variation.

Continuing the example, once you have done the interviews, you may have some ideas for improvement. It might be to automate some communication, increase response time, add more time for explanations, or something else. Let’s say you got sick last year and lost some clients because your response time during that time was not good. This year, you can put a sick plan in place to call on a peer to help you out so your service does not suffer.

The AAR requires an open mind and you will need to accept responsibility. One of the key benefits of the AAR is increased accountability. The core questions to ask yourself and your team include:

What was supposed to happen?
What did happen?
What worked? What should we keep doing?
What didn’t work? What are some improvements?
What advice would you give yourself at the beginning of the year? (Or project?)
What personal lessons did you learn?

You can use the AAR to improve your business by using it after each large project, to measure goals, or for a specific timeframe. Look at your first quarter performance this year. Are you on track? What improvements do you need to make for next quarter that you can work on over the summer and fall? Some opportunities to use the AAR include:

Technology changes / additions or training
Staffing changes
Hiring process changes
Marketing changes / additions or training
Operations changes / additions or training
New service or product development / new niches
Changes in your existing services or products
Customer retention
Sales cycle changes or development
Pricing evaluations
Client surveys / communications / service level changes

The good thing about the AAR is you can make it as formal or informal as you want. You can invite your team or do it yourself, although you’re going to need an open, unbiased mind. Try it in your business, and let us know if we can help.

Five Digital Marketing Trends to Get More Customers

Online marketing is a large component of marketing for many small businesses. There are many aspects to online marketing that you’ll want to consider for your business. Here are just five for your consideration.

Content Marketing

Content marketing is huge, and it consists of generating articles, blog posts, social media updates, white papers, videos, and other educational materials about your company’s products and services. Content marketing provides your prospects with something to read, watch, or learn from.

You can offer your content via your website, social media pages, a special landing page, in a blog, in the description portion of your profiles, via paid ads, or almost anywhere online. Your content should promote your brand as well as show your prospect how to use your product or service.

Video

Video has become incredibly important. It’s no longer enough to generate text. Graphics are better than text, but video trumps them all when it comes to effectiveness, higher search rankings, engagement, and sales conversions.

The good news is you don’t have to hire an expensive video team anymore. A good video camera is less than $500, and you can also use your smartphone for some very decent footage.

Directories

It’s no longer enough to simply have a website. Being listed in online directories will help your business expand its visibility. Some common directories for small business include:

Yelp
Angie’s List
Manta
Better Business Bureau
Yellow Pages (online version)
Thumbtack
Your local Chamber of Commerce
Craigslist
Google for Business (Google Places)

Some of these directories work best if you ask customers to post reviews. Be sure to also check out your industry-specific directories.

Social Media

Including social media in your digital marketing is a no-brainer today. Graphic and video posts are far more effective than text posts, so it’s important to make this content switch if you haven’t already.

If you’ve focused on the “big 3” platforms – LinkedIn, Twitter, and Facebook – it might be time to try some new ones. Pinterest and Instagram lend themselves to graphic representation of your product. Google Plus is often overlooked but can help search engine rankings. And YouTube is a must because of the importance of video.

Public Relations

Digital public relations has been around for a while as well. If you don’t already have a Press page on your website, consider this addition. It can list contact information for reporters as well as a list of articles that your product, company, or employees have been featured in. You can also post press releases to this page.

Distributing press releases is less expensive than ever with options such as PRWeb and PRNewswire.

Make sure your digital marketing campaign has all the components above and that you have updated your content for these latest trends. Having an up-to-date digital campaign will help you generate more revenue and grow your business.