Banking, Accounting and Money

17 minutes
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First tested there. The first set of systems I want to talk about are the ones that handle money in your business. Banking, accounting, invoicing, ecommerce, I'll tackle separately. I've been involved in e commerce for almost 20 years on It's its own hairball. It's its own set of rules, its own set of challenges. And as it stands right now, you're not going to find those two things completely overlapped, at least not likely to so ecommerce, separate section.

Generic advice from the scorecard section applies here. When you're looking at your banking accounting invoicing solution or solutions. You want to say, do they have a good web story? is a cloud based, is it secure? Do they have a good mobile story and then critically pay attention to API's and or data integration, they'll make a big difference in how your business runs. And how it scales up.

As you grow, which is what you want to do. You'd think that banking and accounting and invoicing could all be done in one package. I don't know of a bank that says we're also an accounting system. Maybe there's a rules reason for that. always struck me as a little bit, huh. Because it's the same data.

I'm mostly dealing with bank data when I'm looking at accounting data, but there you go, I'll give you my bias up front as well. accounting is the one piece of this equation that I find sort of the least interesting to do myself. So take my perspective on accounting with a grain of salt. I'm not necessarily good at it. Um, you need to make a good bank choice right off the bat and making a good bank choice will actually make your life and running a business a whole lot easier. We went up the growth path from local credit union.

Oops, outgrow that to local bank. Oops, kind of outgrew that. Now we're with one of the major international banks, I'm not going to log into our bank account and walk through stuff, it would take way too long to start masking numbers in details that shouldn't be published in a video. So there you go. But we are with one of the major national banks. Now, in this case, Wells Fargo, the reasons we did that.

We had some international transactions and needed to deal with wire transfers. The other guys the smaller guys didn't really know how to handle that. That was one of the pieces. The the systems built on to the banking at the major national guys are really pretty, pretty impressive. Like, the things you can do look at detail delegate, hook up, automate, are terrific. And the mobile clients are coming up the curve very quickly.

For the big national banks. I suspect that's true for the local banks as well, but they don't have the war chest and the numbers equation to do that quite as aggressively. I was out of the office the other day realized I hadn't paid the supplier wire, pull my phone out of my pocket logged into the Wells Fargo app found him in the list of suppliers and Bill Pay said pay this guy send a check tomorrow done. I didn't like a stamp. I didn't look for the checkbook. It's all recorded.

And I didn't have to be in the office to do it. No, no substitute for that kind of flexibility. The the data import export from banking is it kind of a weird state and I suspect it's gonna get better quickly. But here's my observation what I've seen in the last decade or so, banks slowly started offering consumers and businesses the ability to do web login, to look at transactions as systems like accounting, invoicing, even CRM, have started showing up and say we need data out of that. There's this massive hack going on, where you provide your web login for your bank, for another system to get the data it needs. out of your bank.

So little knucklehead, if you think about it, that the banks should provide a transaction flow or a data flow. That's specifically not what was for human beings. And now it's going to be used for systems. But that seems to be where a lot of more Now, one of the things to put on your checklist for banking is, Does my bank provide the data that other systems might need? The bigger it is, the more likely that is? The smaller it is, the more important it is to look at that question.

So enough said for banking, you're a bank, if you're going to do e commerce, a bank that can handle on merchant banking side of e commerce may be something to consider right off the bat. I'll try to touch on that when I get to the e commerce section later. So that for banking, yes, it's central to your world. Yes, you log into your bank or fire up your bank mobile app all the time. You should you're running a business right. Now let's talk about accounting and invoicing.

As I said, count is not my thing. And I'll tell you why. I've, it feels like it's too easy to spend time categorizing the paperclip and staple transactions and ignore the big thing that will make or break your business, which is are you actually getting paid for what you do? Many of the accounting systems in existence will take care of invoicing. I suspect they're all getting better rapidly. My experience as of five or six years ago was that the invoicing in accounting systems stunk, just stunk.

And it was really easy to get behind the curve because that that task had so much bookkeeping involved to get behind the curve of actually saying, dear client, my no we did the work, please pay us your client. We're going to do the work. Please pay us. Did your client pay you? Yes, no. So the fact that invoicing systems just that narrow category invoicing, sort of showed up in the world as a separate viable proposition tells you a lot about how poor the invoicing function in a lot of accounting systems was, for a long time.

They're sort of starting to re converge on. Some of the invoicing systems in the world are starting to become accounting systems cloud based, and some of the accounting systems, particularly cloud based ones are getting better at the game of invoicing. I heard a talk by CEO some very successful company here. Actually, the guy's a friend of mine, a number of years ago, he talked at length about cash flow management. You think that's the most boring subject in the world, Franklin. I'm so grateful this day that I listened to him give that talk, because it really made me focus on cash flow management of our business.

Who who's paying us how quickly makes a huge difference to keeping the business viable, as you said, then more businesses die from poor cash flow management than anything So make your invoicing system selection. Make sure it works for your business. Let me walk through some of the pay no attention to that edit, break. Let's talk about invoicing up. As I said, it's very important to pick an invoicing system that works for your business. We've used fresh books for years.

They're growing their footprint from invoicing to accounting. They're not our accounting system right now. We were already invested in that we already outsourced the bookkeeping, that all works fairly seamlessly, because most accountants, as I said, are kind of QuickBooks centric. But for invoicing, fresh book is fresh books is the cat's meow. I'm not going to make this a feature tour of fresh books. I'll show you a couple of things that make it just amazing.

From my point of view. I set up a demo company. I made us a client of the demo company. This is all that's involved in setting up an invoice, pick the client is just one in there. Plug in the task or the item that you're selling or whatever else. invoice numbers will auto assign to numbers you can put in there, bla bla bla, bla bla and and freshbooks makes online payment fairly easy.

Let's leave that aside. We're not set up for that. If I was done with this, like this is the invoice I was going to send to say visually, I push the center send by Email button, boom PDF, or a link. Here's a critical thing a link goes off in email to that guy said visually saying you've got an invoice from demo co pretty seamless, right? We've sent hundreds, hundreds of invoices this way via email. One or two clients in the last four or five years have said no, no, I need a paper invoice and someone to lick a stamp and put it in the mail for the most part.

Sending invoices via email link linked, links in email, sorry, has worked great. Here's the thing that's deceptively useful about it. This, this set of invoices, right? There's only one right now, the last column there says status. Right now the status says, sent. Hang on a second, I'll go read the invoice.

So I just logged into my email, click the link, and refresh the screen status now says outstanding on our config. I think the status would say that the invoice had been read. Now, is that a little thing? No. When you're desperate to get paid by a big client that sucked up a lot of time, and you get a run around that says, Oh, yeah, we got your invoice. When you can log in and say, No, you haven't you haven't even read it yet.

You have a heck of a lot more power to move the discussion about terms forward. You should have good contracts and have all that arranged in advance. And hopefully nobody ever does that to you. But if you do get that, and it's threatening your business, it's incredibly empowering to be able to say, You know what? You haven't looked at it or you did look at it, but you looked at it and date date x, and you're responsible for it once you look at it. So could you please move this ball forward, so that I've got a business, I did my part, you Please do your part.

The other thing that freshbooks launched a few years back, which I think is just really, really, really, really smart, is they essentially turned freshbooks into a network in and of itself. When we bring on a freelancer to do work for us. I actually send them an invite to get a freshbooks account of their own doesn't cost them anything, at least at that stage of the game. The reason I do that is I say please send me invoices through freshbooks. Why? Because those come automatically into my invoicing system as invoices.

Received, I don't have to do separate, double entry paperwork, keep track of PDF stuff. All of the freelancers I paid are in there in the invoices sent to me in the same system. It's great design. And actually, I think the more people using that system, that cloud based system, the better for everybody in the system. There are plenty of alternatives. I'm sure they're very, very good.

I found these guys to be fantastic. I recommend them highly. I've mentioned them enough in the last in the last few lessons. So take a look at them. See if they suit your business on I can't really talk to freshbooks accounting. We don't use it yet, as I said, but given the solidity of their execution on invoicing, I would expect them to do a very, very good job on accounting, they still have to come up to that threshold of QuickBooks and CPAs.

And the sort of standardization of that world on QuickBooks to really They compete. Let me move from invoicing actually Sorry, I'll hit a couple of other invoicing systems. I've heard good stuff about Ronen, I haven't used it. But you should look at alternatives and not just take one bit of advice. So put these guys in the list that you should evaluate Zoho, I've kept track of for years. It's a very, very comprehensive cloud platform with lots and lots and lots of functions, including now invoicing and accounting.

I suspect that you could run your entire business soup to nuts on Zoho. So you if you're just getting started, you may want to take a serious look at all of the different modules and components including invoicing, including bookkeeping. The one thing I'd say characterizing it when I've evaluated Zoho for various functions in the past is it can get a little expensive piece by piece. The benefit is all the pieces work together. But it actually Little get a little bit can be a little bit costly compared to sort of piece by piece best to breed other solutions. So factor that into your research and planning so Zoho worth a look.

Ronen worth a look. I'll bridge over talk about accounting. As I said, most of the cloud accounting systems are starting to do invoicing better, they probably always did it. But functions like invoice via PDF, keep track of the link keep track of the status. They're just they're just great. It makes it a lot easier to run business on.

If a solution you're looking at for accounting does invoicing the old fashioned way, which is print and stamp. Don't bother. Seriously Don't bother. Make that one of your checklists added for accounting solutions in the accounting domain. The bulk of people are still on desktop accounting system. We're actually still in desktop accounting system because of The CPA and bookkeeper legacy.

They're they're very well, they were very well versed in the desktop solutions. They have a whole bunch of automation of their business wrapped around using those desktops, solutions. Specifically QuickBooks, I actually paid our bookkeeper extra for close to a year to keep our books in two systems side by side, I had to keep the books in zero x Dr. O. And I had to keep them in one she was accustomed to QuickBooks. At the end of that period, I said, Okay, which one works better for you? which one works better for us?

And she said, I get why you'd like the online cloud based accounting, but I do all the accounting stuff for you. I'm more used to I'm better, I'm faster in the one that I'm accustomed to. And you're not telling me that there's any financial status or reporting stuff missing. From me doing it that way you tend to get most of that from your bank. So all things being equal, I'd prefer to stick with the one that works with the rest of the flow and goes easily to the CPAs, and so on. And I said, okey dokey.

And we shut down to zero evaluation. I had been impressed with it. I didn't log in every day. In fact, I didn't log in every week, it was kind of like she's dealing with it. I just don't like that level of categorization leads to financial transactions. So if you've got more detailed accounting to do, and you really want to keep a finger on the pulse, what are we spending on this that the other if you're if your business has a lot more transactional and cost of goods, complexity, before you go off the desktop solution, if you can kick the tires really hard on a cloud based solution, like zero or possibly outright, or possibly QuickBooks Online, I'd encourage you to do so.

Recognize that you'll be having a discussion with your accountant about file formats and Reports and things like that. And it may make a once a year pain or once a year additional cost that you don't want to take on, I have to put in a plug for into it. That is a fantastically smart company. And despite their massive market share and grip on small business accounting with QuickBooks, they are not sitting on their laurels and not changing that they're moving it forward really fast. I suspect it's their tax clients that are more the inhibitor on how quickly they can make a cloud based platform that's as good and comprehensive. last little plug about QuickBooks desktop version, the sacred who's got the QuickBooks file thing drove me nuts.

That's the real reason I don't like desktop accounting. So I always feel like there's one file somewhere on the planet. It's got everything about my business in it. So to close off on making really good banking choice. look really hard. At the comprehensiveness of the website, the set of features and functions specific to your business, the integration to external systems, make sure they've got a very good mobile app that that suits the kind of things that you do.

Invoicing and accounting, you may end up with the same solution for both you may get an accounting system with terrific invoicing, you may get an invoicing company that's really starting to expand it footprint in accounting. There are lots of them out there. I mentioned a couple. I'm guessing there's dozens, if not hundreds, that that work in this domain on look at how they'll play with each other and with other systems that will be part of your business before you make a choice. Because once you're in, you're probably in for the long haul. We'll talk we'll we'll touch e commerce next.


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