GO-PAYROLL

Why Hiring Out Your Payroll is a Good Move For Your Small Business

2011-03-07T10:22:00.001-08:00

Those of us that own and operate small businesses know that there are some functions, especially some administrative ones, that are best left to experts. These can include tax preparation, accounting, human resources compliance, and payroll.

Most people who start a small business are not versed in these areas, and can indeed get themselves into a good bit of trouble if deadlines are missed or other errors are made.

Trying to save a few bucks by doing these things yourself can cost you big time in the long run. Miss filing your quarterly 941 forms? Penalty. Miss making a scheduled 941 tax deposit: penalty and interest.

A good payroll service will help you in a variety of ways. They can see that your paychecks and/or direct deposits are provided on time and accurately every payday. They can make sure you are aware of every deadline, be it a tax payment or a tax return due date. They can provide specialized services such as tracking workers’ compensation data, or 401(k) contribution data. And they will of course provide your W2s (and 1099s) at the end of the year.

Here are some questions to ask a prospective payroll service:

Do you provide complete payroll processing?

Can I opt for direct deposit for my employees?

Do you use your own software? (No is not a good answer)

Is my set up free?

Is my first month free?

Do you take money out of my bank account for taxes that are not yet due?

How much is this going to cost me?

Are you local?

These are just some of the questions that might be helpful. At Go-Payroll.com we are local, we use our own software, we can handle virtually any type of payroll situation for you, and WE NEVER USE YOUR MONEY TO MAKE MONEY! And we charge far less than the big payroll services. Why? Because we are a small business, and understand perfectly the needs of small business. Our overhead is reasonable, and while we want to make a fair profit on our services, we want our prices to be reasonable as well.

So visit our website at http://www.go-payroll.com and check us out.

Black and White

2011-02-04T10:24:00.000-08:00

Black and White

OK. I admit it; I am a black and white thinker. I’ll also cop to being a Libra, which means I like things to be reasonably fair and balanced. If I could be granted one wish in this lifetime, it would be that every human being be predisposed to honest and straightforward behavior. There is too much in our world that is based on misdirection, obfuscation, and the all-important error of omission.

My wife and I are deluged with solicitations for charitable donations. We have a well thought out charitable giving plan, and there are a number of causes and institutions that we support each year. Because we pay attention and because we keep good records, we have noticed that very often a number of these organizations will send out renewal solicitations at different times. These have begun to appear to me to be deliberate attempts to generate extra money from those people who might not keep as scrupulous records as we do. Others attempt to scare you by invoking “alarmist rhetoric” in order to goad you into giving to their particular cause. In these situations the truth is often stretched to the breaking point in order to motivate people. I find this tactic just as distasteful as the multiple renewal tactics, and have resolved never to give to ANY organization that uses either tactic. Be straightforward, give me the facts and let me make intelligent decisions about my charitable giving.

Political causes are famous for the “alarmist rhetoric” tactic. And this takes several forms. For example, the word “liberal” has been demonized. On the right, the NRA will tell you that your gun rights are in serious jeopardy when they are not. On the left, the Right to Choose movement raises the alarm with every mailing, letting us know in no uncertain terms that our rights will evaporate if we do not contribute immediately . The environmental movement has cherry picked data to make a particular point on more than one occasion. The anti-immigration movement would have us believe that all our public services are in jeopardy because we are providing them to people who are in this country illegally. These tactics are used because they work, despite the fact that often they are very often out and out lies. They move the discussion from a rational plane, where facts can be evaluated and intelligent choices made, to an emotional plane. This tends to eliminate civil discourse about ANY issue. And the use of this type of tactic is in no way limited to either the left or the right. It is almost as if demagoguery is the only language spoken in politics. I find this truly disturbing.

And don’t even get me started about advertising, packaging and related issues. Every day we see blatant examples of misleading advertising, financial disclosures written in incomprehensible language; ads for dietary supplements that make extravagant claims under a small disclaimer that says “These statements have NOT been evaluated by the FDA…” And seldom are these people called out on these lies. And even when they are caught, they simply fire up the PR machinery to spin even faster. Imagine this: in the United States, there is only one state where using an asterisk in an advertisement to mislead the reader or viewer is illegal. That is Massachusetts. In any other state, advertisements can blatantly lie in large print so long as the truth is told in fine print under an asterisk, which can be placed anywhere else in the ad. Isn’t that special?

If this is the place to which we have come; a place where the media and the advertising world count on the fact that we are too stupid to make our own choices, then it is sad indeed, not to mention profoundly insulting. Even sadder is the fact that in this day and age each of us is exposed to far more information than our parents and grandparents were. We are exposed to information and advertising during virtually every waking hour, by television, radio, print and now the Internet. It is orders of magnitude more difficult for the average person to discern the truth about any given fact that is presented.

Finally, I’d like to say a few words about our “system of justice”. As you may or may not be aware, our “system of justice” has little to do with actual justice. It is little more than theatre, and often it is theatre of the absurd. We are told that every defendant is entitled to a vigorous defense. I am OK with that, especially knowing that there are a significant number of innocent people serving sentences for crimes they did not commit. There are likely also a significant number of people walking the streets who have committed crimes and never been punished for them. Why, on one hand, do we spend a bundle of money for a trial for the person who committed the atrocity in Tucson, when he is clearly guilty; and at the same time have prosecutors fighting tooth and nail to keep a defendant who has been proven innocent by DNA testing in prison? Is this not absolutely ridiculous?

And how many vigorous prosecutions and vigorous defenses involve misdirecting the jury; cherry picking jurors that may be unable to understand a complex case or who may decide a case based on emotion instead of fact? In many jurisdictions, it unfortunately comes down to winning; who has the better lawyer. For this sad situation, I do not blame attorneys. Most often they come out of law school with the best of intentions. It is the system that needs to be changed. And while the system is so very imperfect, we certainly have no business putting people to death unless we are 100% certain that they are guilty and that there is no other means of punishment that will assure that society is kept safe.

We have created systems that have gradually grown to the point where we can no longer rely on them to be straightforward with us; and that are very easy to game. It is almost as if every time we shop for something we are going into battle. Our complaints are ignored; our airlines and telecommunications companies treat us like sheep, and we are often powerless to have any effect on the outcome.

What can we do? The very best advice I can offer is this: pay scrupulous attention. Pay attention to everything you are told, and then question the answer. Be a troublemaker. Question everything you read and try to independently determine the truth, especially when the issue is important to you or you are making a large purchase or investment. The more we are troublemakers, the less likely they are to lie to us, because they know they will be challenged.

Changes to Payroll Reporting

2010-05-25T07:37:00.000-07:00

Changes in Payroll and Reporting for 2010
-OR-
Who’s Your Amazing Payroll Guy!

There have been some sweeping changes made to payroll reporting as a result of the Hire Act of 2010. This legislation was created and passed to provide incentives to employers to add employees.

These incentives are significant.

In 2010, you will have a “holiday” from the employer portion of the social security tax (6.20%) for any qualified employee hired after 02-03-2010. A qualified employee is any employee who:

• begins employment with you after February 3, 2010, and before January 1, 2011;

• certifies by signed affidavit, or similar statement under penalties of perjury, that he or she has not been employed for more than 40 hours during the 60-day period ending on the date the employee begins employment with you;

• is not employed by you to replace another employee unless the other employee separated from employment voluntarily or for cause (including downsizing); and

• is not related to you. An employee is related to you if he or she is your child or a descendent of your child, your sibling or stepsibling, your parent or an ancestor of your parent, your stepparent, your niece or nephew, your aunt or uncle, or your in-law. An employee also is related to you if he or she is related to anyone who owns more than 50% of your outstanding stock or capital and profits interest or is your dependent or a dependent of anyone who owns more than 50% of your outstanding stock or capital and profits

In other words, if this employee is hired and works the remainder of the year, and has wages of $20000 for the remainder of the year, you will save: 1240.00 in employer taxes for that employee in 2010. The accounting for these savings is done on your form 941 return done each quarter.

Is your head spinning yet? We have your back!

Here at Go-payroll.com, we have modified the payroll to handle these changes in the law.

In 2011, those employees qualified under the Hire Act, who remain employed for 52 weeks, and whose wages meet certain criteria, will qualify you for a $1000 tax credit on your corporate income taxes. Your tax professional can assist you in determining the additional criteria that must be met.

Be not afraid! The Go-payroll.com payroll system will track these employees for you and provide reporting in 2011 as to who qualifies for the credit.

Another massive change for employers and other business people was buried in the Health Care reform legislation. Starting with tax year 2012, businesses will have to issue 1099MISC forms to ANYONE whom they pay more than $600 in a year, regardless of whether they are a corporation or not. The IRS is attempting to reduce the monumental amount of unreported income that happens when 1099s are not filed.

We’re already on the case. Our ability to process your 1099s for you has been available for years. So don’t worry, just let us handle it. We already process and print hundreds of 1099s each year for our customers.

As we are fond of saying around here, “see how it feels to have and AMAZING payroll guy!”

Who Are Your Customers?

2010-04-22T06:56:00.000-07:00

This article will focus on the idea of knowing your customers and knowing what your ideal customer looks like so that you can aim your marketing efforts at attracting that very type of customer.

Every so often it is useful to evaluate your customer base versus your current business plan. It may be that one or more of your regular customers no longer fit the criteria you have established for your ideal customer.

In our business, software development and on line payroll, we look for people who:
• Need our products and services
• Understand the value of excellent customer service and are willing to pay for it
• Help us constructively improve our products and services
• Do what they say they’re going to do
• Pass the “Grief to Revenue” evaluation

Any marketing effort will attract a variety of prospective customers to your door. Some of those will not be qualified to be your customer. Think about that. Not everyone is qualified to be your customer. This is indeed an interesting concept, and one that bears a great deal of your attention.

Do you have customers that complain about every bill? Do those same people who complain about the bill also make unreasonable demands on your time? Do they then string you out to 120 days before paying you? I contend that there is no customer that is worth that sort of treatment. It is wise to try to determine in advance if any of these behaviors will show themselves before entering into a relationship with the prospective customer.

In addition to preventative customer evaluations, it is wise to review existing customer relationships from time to time in order to make sure that these relationships are still working for you.

There are times when long-term customer relationships can have an adverse effect on your business. For example, a customer may become increasingly demanding over time, citing the long term relationship as a rationale for the increased demands. Or a customer may resist your attempts to modify how you do business. Many people do not like change. And since the evolution of a business, especially a high-tech business like mine dictates frequent change, we find that periodically some customers will be resistant to that change. We have updated our accounting software frequently in the 26 years we have been in business. And at every major update, we have had people that insisted on staying with the older versions. Over 4 or 5 major rewrites of the software, it can become an expensive and time-consuming proposition to continue to support and modify the older versions.

As a business grows, often we hire people to do jobs that we have handled ourselves in the past. For example, I have always handled customer support, and customers like talking to the ‘guy who wrote the software’. Delegating customer support to a new employee will cause some resistance on the part of some customers.

You must be cautious here to pay attention to what customers are saying. It can be a big mistake to simply make a number of new rules and expect all customers to accept them without question. Separating reasonable objections from frivolous and self-serving ones can be a real challenge, but one we must all undertake if we wish to maintain a quality customer base.

So as always, the most important aspect of maintaining good customer relations is to PAY ATTENTION, PAY ATTENTION, and PAY ATTENTION SOME MORE!!
Matt Cantillon
04-21-2010

On Being an Employer

2010-03-08T09:28:00.000-08:00

10 Things about Becoming an Employer

You have elected to expand your small business and hire a new employee. This will mean that you have to do payroll for the first time. It is important that you bear several things in mind as you venture into the world of withholding taxes, 941 Forms and W2s. Here are 10 things you need to be aware of.

1. You need an Employer Identification Number from the IRS. If you do not already have one (for example you are a sole proprietorship), you need to apply for the EIN. You will not be able to report wages or pay employment taxes without this number. Here is a handy link to the IRS that will tell you all you need to know about applying for an EIN:

http://www.irs.gov/businesses/small/article/0,,id=97860,00.html

2. You should register as an employer in the state in which you do business. This is likewise critical. You will need to make sure that you are registered to pay withholding taxes for the state, as well as being registered to pay unemployment insurance. These days, most every state has a one stop web site for new employers.

3. Be aware that some states have additional taxes beyond the standard withholding tax and unemployment tax. For example, California requires withholding for disability insurance, as does Rhode Island. Some states also have county and city income tax that needs to be withheld from your employees’ pay. Your state’s one stop web site will usually provide this information for you.

4. Make sure you are familiar with the federal wage and hour regulations, minimum wage requirements, and also those of your state. Some states have minimum wages that are higher than the federal minimum, and in these cases the state’s rate supersedes the federal. It is crucial to follow these regulations. You do not want to get caught up in any kind of wage and hour audit.

5. Make sure you have your employees fill in a form W-4, an I-9 form, and provide proper identification that documents that they are legal residents of the U.S.

6. You will likely be required to report new hires to your state’s department of labor. Make sure you do this when required.

7. When you do payroll, you will withhold a certain amount of Federal Withholding tax, FICA tax (Social Security), Medicare Tax and state taxes as well. You will be required to deposit the federal, FICA and Medicare taxes, along with the matching FICA and Medicare amounts that you are required to pay. When these deposits occur depends on how large your payroll is. For small, one and two person payrolls, you will likely be able to deposit quarterly or monthly.

8. You will also need to file quarterly payroll reports. These include federal form 941 and at least one state income tax return and state unemployment return. These will usually be due within 30 days of the end of each calendar quarter.

9. You will need to provide each employee with a form W-2 by January 31 each year, detailing the wages and taxes for the prior year. In addition, you will need to file these forms to the federal and state governments.

10. If by now your head is spinning, welcome to the world of being an employer.
It is a lot to keep track of. Being an employer is serious business, and missing any of the required steps can result in penalties, extra taxes, and sometimes worse.

One possible way to deal with these details in an efficient manner is to hire a payroll processor, or an on-line payroll service.
These companies can handle all the details for you. They can remind you when taxes are due, and provide you your quarterly and annual returns.
We are such a company. Pay us a visit at:

http://www.go-payroll.com

and see how we can, for a very reasonable monthly fee, turn the dizzying world of being an employer into a simple and easy to manage part of your business. We’re the ‘Amazing Payroll Guys!”

Building The Customer Centered Business

2009-10-20T11:58:00.000-07:00

Building The Customer Centered Business

I have owned and managed my small software business for nearly 26 years. My average customer has been with me and used my systems for 17 years.

What is it that compels a customer to remain loyal for such a long time? Customers buy and use products and services that will benefit them in the long run. So how have I maintained this base for so long? That is what I will attempt to explain in this article.

My business has centered around the development and marketing of a fairly sophisticated high end accounting system for small to medium sized businesses. This system provides things like payroll, cash management, job-costing, inventory and other important accounting functions. My customers range from professional accountants to construction firms to restaurant chains.

How many of you have been enthusiastic about starting a business relationship with a new company, only to become disenchanted the first time you required some service, or needed a question answered? How many of you have found surprises in dealing with a new supplier after you have signed on the dotted line? It seems that customer service has been replaced by something called CRM (romantic, isn’t it??). CRM is a software program that is designed to manage customer relationships. This approach, if done properly, can be an excellent one to manage a large number of customers. A good example of a company that has done really well with servicing huge numbers of customers is Amazon.com. Conversely, if this approach is mismanaged, as it is in so many instances, it can leave customers feeling angry, cheated and unheard.

When customers call my company, it is usually because they have a question about how to do something, or something has gone wrong in an unexpected way. Very often, what has gone wrong has more to do with their computer environment, their Internet connection or some other factor external to the software. However, we do not play the “it’s not the software” game. We try to diagnose the problem, whatever it is, and get them help to get it fixed. If they have an accounting question or problem, we do what is necessary to get them an answer. When they want something in the software changed or something added, we work with them to iron out a solution that is economical and will meet their needs.

In our business we take the approach that there are no foolish questions, even when the question may seem, well, a bit foolish. My industry trade journals are full of amusing stories about computer users doing dumb things and asking questions that seem very elementary, for example. In truth I am sure I could contribute many similar stories myself. Regardless, there is no situation where it is a good idea to embarrass a customer or make them feel badly that they called. That is simply unacceptable customer service.

The software business model has evolved and consolidated to the point where there are fewer and fewer small shops like ours around. We ourselves have evolved into a new business model that will carry us into the future: on line accounting services. The larger companies with millions of users, take a very different approach to customer service than we do. Often the large companies’ methods result in unsatisfactory customer attitudes toward the product and frustration with its support.

We will continue to listen and to pay attention to our customers’individual needs. No matter how many customers we sign up in the coming years, we will always try to make them feel as though they are part of something special.

10-14-2009

Matt Cantillon

Keeping a Small Business Afloat 25 Years II

2009-09-01T12:33:00.000-07:00

Keeping a Small Business Afloat for 25 Years – Part II

Today, I would like to focus on some specific and hopefully helpful ideas to help you keep your businesses afloat for 25 years or more.

1. Stay on top of what is going on in your industry, and incorporate new ideas that you find useful.

I am in a high tech business, and as such, it is absolutely essential that I keep up to date with the latest technological advances, and make a determination as to how these advances can benefit my customers. I work very hard to keep myself informed about new and cheaper computer and printer hardware, new web design ideas and methodologies, and most importantly, advances in computer security.

There are a number of reasons why this approach is essential. First, it provides a valuable service to my customers. If I am up to date on what is relevant to their computer installations, then I am a resource that they can turn to at any time for advice, making me a valuable asset to their business success. Secondly, it provides me an avenue to stay sharp and fresh. Any business can become stale. One of the greatest enemies to the life of a business is the idea that “That’s the way we’ve always done it!” You can easily become stuck, stale and irrelevant to your customers.

2.Pay close attention to what your customers tell you. Listen, listen and then listen some more.

It is common for business owners to presume that they know what is best for their customers. Many large corporations have developed very bad reputations with respect to customer service because they no longer listen. They operate in a vacuum without any firsthand knowledge of what their customers need, want or value. Unfortunately many small businesses fall into the same trap.

Not everything a customer will tell you is something you want to hear. However, these are the most important things out there for you to hear, especially if you hear the same thing from more than one customer. You have to know what they need, what you are doing right, and most importantly, what you are doing wrong, if you want to be the one to meet their needs. And it does not matter what your industry is. Listen, and pay attention!

3.Pay very close attention to your expenses and income. Understand where your revenue is coming from and where it is going.

This is a very crucial aspect of small business ownership. You HAVE TO MANAGE IT, even if it is a one person business, like mine. At the beginning of each year, I create a revenue budget and an expense budget. These are not just spreadsheets that end up collecting dust in some abandoned corner of my hard drive. I compare my actual results to my budgets for both income and expenses every month. If you do not know where your revenue is going to come from, then how can you plan how to market your product or service?

And if you don’t maintain an iron grip on your overhead, it can get away from you faster than you could ever imagine.

Along these lines, as you grow it is essential to put controls in place so that you can continue to understand the financial aspects of your business. Here your greatest ally is a CPA who understands small business. The value of a CPA to your business cannot be overstated.
4.Stay enthusiastic.

Several times over the last 25 years I have fallen into periods of “burnout.” These happen to all small business owners, sometimes as a result of stress, or even boredom. I have been lucky enough to use these as an opportunity to take a hard look at what I was doing. Your customers will respond way better to someone who sounds glad that they have called. Everyone has days when they are cranky, but if your burnout, and associated crankiness last for any length of time, your customers will hear it, and many will be turned off by it.

Make absolutely sure that you maintain outside interests. Running a small business can be an intense and extremely demanding task. It is absolutely essential that you take care of yourself by getting adequate rest, having outside interests, spending time with family and friends. Have a life outside your business. It will keep you fresh.

These are but a few of the many things we can do to keep our small businesses and ourselves afloat.

Matt Cantillon
Go-payroll.com

Keeping a Small Business Afloat for 25 Years

2009-07-02T08:25:00.001-07:00

Keeping any business afloat for a quarter century can be a challenge, as we have recently seen with General Motors and Chrysler. Who’d have thought that we would be witnessing the demise of large businesses such as these auto giants, or the investment banks, media companies and airlines we have also lost. These situations illustrate that no business is immune from the effects of an economic downturn. Small businesses are especially susceptible to difficulties during such downturns.

What kind of business perseveres during difficult times? What are the qualities that allow businesses to be successful even in the face of adverse conditions?

My own small business recently celebrated 25 years in business. I develop and market accounting software systems for small businesses. These include payroll, inventory control and other such accounting modules. My average user has been with me 17 years. What has been the major factor in my survival? It is because I pay attention.

I pay attention to my customers’ needs. I pay attention to what things cost me. It is lack of awareness that can sneak up and put you out of business. An unhappy customer lurking out there, feeling ignored and unsupported can be a real horror, especially if that customer makes his or her unhappiness known to others. Runaway overhead costs can put you behind the cash flow eight ball faster than anything else. Failing to collect your accounts receivable can damage your cash flow beyond repair.

It can seem overwhelming to pay attention to all the aspects of a business. The way I have dealt with this issue has been to limit my growth, and to limit the amount of new business I take on each year. This works for me because I am a one-person business. By staying small, I have the capacity to listen to each of my customers, limit the amount of overhead expense, and make sure I collect all my receivables each month.

This strategy cannot work for all small businesses. I have not had to worry much about marketing, as my customer base provides both new projects and sufficient referrals each year to keep things going at a brisk, but not daunting, pace. Many businesses in a variety of industries must market themselves in order to be successful. Many small businesses need growth to survive.

Being a small business owner implies that you have to keep your eye on ALL the balls in the air coming at you. Careful planning can be your greatest asset in dealing with all those balls. You need a yearly plan to help manage your expenses, and you need to monitor it and stick to it. That way you know what is being spent and where. You need a marketing plan in place so you know how you are going to generate new business. You need a customer service plan in place so you can make sure that your customers are cared for in the way you would want to be taken care of. In other words, you can leave nothing to chance.

If you are completely on your own, or if you do not feel expert enough in these areas to design and execute these plans yourself; help is available. The value of a good team of advisors cannot be overstated. A CPA can help you with the financial planning and accounting needed to keep the financial end of your business in shape. A good business attorney can help you in a number of ways, including choosing the best structure for your business (corporation, LLC and so forth). A good business attorney can review leases, advise you about trademarks, and assist you in establishing employment policies. Being careful and attentive in your hiring decisions can bring you skilled and hard working employees who will help your business grow.

In coming articles I will get more specific about several of these areas. Next time we will focus on the financial aspects of your business.

I’d like to close with a story about a fellow who embodies small business success. This man is a realtor. I tell people that when you look up realtor in the dictionary, there is a picture of Jason Boggs. When he is your realtor, he is your advocate. He listens carefully to your needs. He tells you the truth. He acts in your best interest. He does what he says he is going to do. If someone needs the services of a realtor, I always recommend him. As a result of the way he operates, he has been, and continues to be very successful. His value system is at the core of how every business should function.

So there you have it. You have to pay close attention, do what you say you’re going to do, and act in your customers’ best interest. We will discuss how best to do this in future articles.

Matt Cantillon

GO Industries LLC

2009-05-18T09:49:00.000-07:00

The Concept of ‘Caveat Emptor’

This week begins a series of essays on business ethics. I hope to discuss a variety of subtopics under this main topic. We will begin with the concept of “caveat emptor”, or ‘let the buyer beware’.

This is an age old concept that asserts that when we enter into a transaction, we should be skeptical and we should perform all possible due diligence to protect ourselves from being cheated. This concept remained the conventional wisdom for centuries. In the marketplace, those buyers who did the most homework were able to most often avoid being cheated. And those who did not got plucked, like the pigeons they were. Who among us has not read a story about someone falling for the “Nigerian Banker” scam, shook our heads and smugly thought, “I’d never fall for that!”

For purposes of this discussion, let’s leave aside all the obvious scams, ponzi schemes, spam, phishing and pump-and-dump operations. We hopefully all know enough to avoid these types of scams. But what about navigating the everyday marketplace?

There are many who will argue that the ‘marketplace’ is sacrosanct, and should not be regulated in any way. The marketplace, so this logic goes, will police itself, and cheaters and scammers will be winnowed out because buyers are smart and can spot them. There are many areas of the ‘marketplace’, where this argument simply does not hold water. Why? Because the game is rigged. The average person’s chances of success in certain ‘marketplaces’ are as poor as they might be in a casino, or a lotto.

A while ago I was in a supermarket and was looking at soap to purchase. The particular soap I wanted was $1.79 for a regular bar. Next to the individual bars, they had a special group of the same sized bars banded together and labeled with a “ SPECIAL 2 for 3.99!”, inferring that the better deal was the “2 for 3.99”. I wandered around the store and found several other such examples where the inference was that buying multiples would be cheaper, and in each case, purchasing 2 of the single item was cheaper than the multiple offer. Do we really have to always be on our toes to this degree when we go shopping in order to avoid being taken advantage of?

Corporate America brings to bear some powerful weapons to motivate us to do whatever it is they want us to that day. And we are all susceptible. Because we are busy, tired, stressed and overworked we are susceptible to motivations and mild misdirection.

In the pharmaceutical sector, we are deluged with ads urging us to ask our doctors if “lipo-hydro-oxy-blasto-narco-soma is right for you”. Often these ads are very clever at glossing over the real facts behind the use of certain pharmaceuticals they advertise. Under the idea of ‘caveat emptor’ we would drag out our “Physician’s Desk Reference” and read all the chemistry and pharmacology related to any medicine we are considering taking, so we are fully aware of it’s implications. Or perhaps we could suspend our normal career and get a degree in biochemistry or pharmacology.

We are deluged with come-ons from financial service companies that then bury the terms and conditions in layers of incomprehensible jargon, so that we are hard pressed to make a determination as to the benefits of the offer. Perhaps here, we can all become lawyers to protect ourselves against hidden or obscure terms and conditions buried in a mountain of legalese.

Retailers, telecommunications companies and other giants often obscure the true pricing of what they are selling in order to preclude us from being able to comparison shop.

In virtually every area, commerce with larger entities (not every one, mind you, but a good many) becomes a futile exercise in trying to determine what is real. What is the real price? What fees will I be charged? What are the side effects of this medicine? What if I want to cancel my plan?

As consumers, we are obviously not going to become lawyers, doctors or pharmacists just to learn the truth of each advertisement we see or hear. But we can pay attention, we can do the math, we can bring to bear a healthy skepticism about any advertisement to which we are exposed.

And as businesses, can we not try to be more forthright in our advertising? Are the bottom line and shareholder value so important that we are willing to compromise all our ethics to achieve positive results? I do not think it would be naïve of me to suggest that we are now witnessing the consequences of too much emphasis on shareholder value. If you trade in your ethical standards for increased shareholder value, you will end up with neither.

Matt Cantillon
05-18-2009

Short Term Disease

2009-04-08T11:20:00.000-07:00

Lately in the financial meltdown, we have seen lots of examples of what I’ll call “Short Term Thinking Disease”. This is an infirmity that causes us to think only in terms of short term advantage, as opposed to longer term strategic thinking. The simplest example I can cite is the person who spends $10 a week on lotto tickets, looking for the big score, as opposed to saving the $10 a week in a savings account or IRA. Unless this hypothetical person is extremely lucky, in 10 years this person will be out $5200.00. Had they saved this amount in a conservative investment paying even a 4.00% return, they’d have: $6383.33.

This is a simple example. But we humans are wired for this sort of thinking, and unless we find a way to rise above this, we are quite possibly in a great deal of trouble. Consider the many CEOs of large corporations who, at the risk of alienating customers and employees, make savage cuts in service and quality in order to show a short term profit. They seem not to be concerned at the long term consequences of their actions. And inevitably the customer base shrivels up over time, and the corporation that has behaved like this is acquired or goes away completely. There are any number of companies that are dancing this type of death dance.

I once lived in a city that had two car dealerships that sold the same brand of car. One dealership treated customers respectfully, had a very good service department, and tried really hard to build a loyal following around not only the brand of car, but also their dealership. This resulted in a steady and respectable business that was sustainable. Their competition was not concerned about whether customers came back. They were all about getting a customer’s name on a sales contract. If the customer later discovered that they had been cheated, so what? It was too late. In addition, they ran a shoddy and dishonest parts and service department. People would go there once, and never go back again.

Sell one car to every eligible buyer in the city, or slowly and steadily build a loyal customer base? If you choose the former, what happens when you have swindled every possible customer? It simply is not sustainable.

We find ourselves in a difficult situation with respect to the economy precisely because of this same type of thinking at every level. Do we do the research buy a solid stock and hold it (boring!) or play the day-trader game (exciting!). Do we buy a home we can’t afford with a mortgage that will become intolerable 5 years down the road? Do we borrow to buy what we want to have today rather than saving for it?

All of this at every level has brought our economy crashing down. Why? Simply that this type of behavior is not sustainable. It may be flashy, it may bring instant gratification (which is just as quick to disappear), and it may even accrue short term financial gain for some.

I have had my small software business for 25 years now. I cannot tell you that I have always thought strategically for the long term. There have been times that I made a mistake or irritated a customer. There have been times I have chosen projects poorly, underestimated the time or costs involved. This sort of thing happens to all small business owners. For the most part, though, I have charged less than the competition and given my customers more. That is why I am still around, thriving and successful. This is why my average customer has remained with me for 17 to 18 years, with many having been on the books for over 20 years.

It is very difficult to resist the temptations presented by the mass media to go for the short term gain. But resist we must.

Corporations and small businesses need to obsess less about the bottom line, and more about pleasing customers and building quality products and services. Odd thing about that is that if we all do that, the bottom line will take care of itself.

All of us need to start being more self sufficient. Take $5 a week and build a slush fund. Take another $5 and save for the future. You won’t miss it. You can use the slush fund every now and then for some discretionary treat. And your future will thank you very much.

Matt Cantillon

Go-Payroll.com

The Business of "The Right Thing"

2009-03-09T11:51:00.000-07:00

The Business of “Doing the Right Thing”

We are witnessing the greatest financial meltdown of our lifetime. Many of our friends and neighbors have lost a job, are in the process of losing a home, or are suffering under staggering medical bills. How is that we find ourselves in such a place?

I contemplate these issues at a time when my own small business has just passed its 25th anniversary. I am proud of the fact that I have managed to outlast several economic downturns, moves across the country, health issues, and many other of the vicissitudes of life. I am proud to say that I have several customers who have been with me more than 20 years. Why is this so? Am I cheaper than everyone else? I do not think so. I think it has to do with integrity. I am not writing this to brag about my own integrity. I leave that for my customers, friends and family to judge.

What is painful to watch in this economic downturn is the staggering lack of integrity that corporate America has shown. And now they are reaping the whirlwind. But if it were just some inept CEO’s and their henchman that were suffering as a result of the meltdown, that would perhaps be OK. But so many of us are suffering life threatening (or at least livelihood threatening) consequences for absolutely no reason.

Every day we hear some horror story about cheating in the marketplace. From salmonella peanuts to Credit Default Swaps to Collateralized Debt Obligations . We hear about exorbitant bonuses paid, not for meritorious performance, but just simply to keep the mediocre performer from moving elsewhere to perform in a mediocre fashion.

In addition, whether or not the average consumer is aware of this, there is a war on. We, as consumers of food, health care, insurance, financial services and entertainment are at war with corporate America. Or rather , they are at war with us. We are deluged moment by moment by advertising. We are expected to make important decisions without being given all the information that we need to make good choices. We are expected to believe what their marketing machinery tells us without independently verifying their claims. Many corporations do not want us to make informed choices (it’s bad for the bottom line!). So we must fight to get the data we need to make a good choice. Whether it be a cell phone plan, cable television for our home, a mortgage, a credit card, or a prescription drug.

So what are we to do to fix this?

The answers are not simple. But here are some things both individuals and businesses can do to help.

If you are a consumer:

• Always make your consumer choices based on the best available data. Use Consumer Reports and other objective sources to help in your evaluations.
• Do not support businesses that lie to you. If a company will not tell you what something costs, perhaps you ought to look elsewhere.
• Do not support businesses that engage in predatory competitive practices. Keep informed about the practices of companies with whom you do business.
• Do not accept mediocre customer service. There are many fine web sites, such as “The Consumerist” and “Rip Off Report” that can help you fight back.
• Develop a healthy skepticism about advertising that you read, hear or see on television.

And if you are a business:

• Always do what you say you’re going to do. Always. Period.
• Pay attention. So much of life is about paying attention. Listen to your customers. Listen to your employees. Listen to your suppliers. It is amazing what you do not miss when you listen.
• Provide good value.
• Always fully disclose the terms and conditions you require to do business with you. Never use hidden fees.
• Treat your employees with respect. History shows us that an adversarial relationship between employer and employees is very bad for business.
• Treat your customers with respect.
• If you take care of your employees and your customers, as well as control your costs, the bottom line can usually take care of itself.
• Not all customers are good for your business. There are bad customers as well as bad businesses. If you find yourself with a bad customer, fire them.

There are those who will read this and say that I am some sort of socialist: that I am anti-business. I am not anti-business. When I have received good service from an airline or a bank, I write letters to compliment them. What I am against is mediocrity, poor service, indifference, cynicism and dishonesty. These have no place in running a business. And if, with the government in conjunction with the outrage of ordinary citizens, we have to regulate ourselves back to a healthy business climate, so be it.

The days of “every person for themselves!” are over. We need to start acting like a society.

03-06-2009

Happy New Year

2009-01-07T08:43:00.000-08:00

Happy New Year! This month is what we (affectionately?) refer to as 'W2 Season', wherein all our customers perform their various year end accounting functions. This year seems,at least so far to be going well. I am getting ready to design the public portion of the web site for GO PAYROLL, our new on-line payroll service.

We look forward to 2009 as a year of positive change and renewal for all of us. I will keep everyone posted on the progress of our new services.

Have a good month

Getting Close

2008-10-27T10:55:00.000-07:00

Hi There!
The software development for the on-line payroll system is nearly finished. All that remains is the year end processing (W2 Forms and such), and some additions and security programming for the control system. We are on track to launch the product in February of 2009.

Small business is suffering under the weight of the cost of health care, until a few days ago, the staggering cost of energy, and now the economic downturn, affecting people's purchasing power everywhere. We will attempt to provide an excellent value to small business when we launch.

Please do not forget to go out and vote next week. It is crucial.

What We are Doing

2008-10-15T08:58:00.000-07:00

Hi!

Just back from a trip to Washington State to visit family. I had never been there before and it is a beautiful state, from one end to the other. It always takes a little effort to get back up to work speed, especially for someone like myself, a one-person firm. But I have been doing what I do for 25 years. Our software, which will start going on line early next year, is 25 years young, in terms of its business logic, but has a whole new user interface, which will make it easy to do ALL of your accounting on our family of sites: GO-PAYROLL.COM, GO-RECEIVABLES.COM and GO-CHECKBOOK.COM. Regardless of your type of business, you will find an easy-to-use, economical and powerful place to manage your business's payroll, receivables and financial reporting.

In the next month, I will update the website (www.go-payroll.com) with more detailed information about the services available, and will also have available sample kits and user manuals that you can download to check out what we are doing.

Talk to you next week!

Small Business Philosophy

2008-10-03T07:56:00.000-07:00

Hi!
This week I want to open up the discussion about small business and its needs. It is a well established fact that over 50% of the employment in this country is provided by businesses of 25 or fewer employees. And yet we small businesses are very often overlooked when it comes to tax benefits, business assistance and so forth. Just look at the current bailout bill. Is there anything for small business here?

Be that as it may, we need to persevere in this difficult economy. The most important thing to remember is to keep debt and overhead as low as possible. My first business lasted only a few years back in the 70s and early 80s before it was acquired. I have had my current business 24 years. The primary reason is that I have managed to stay debt free and have a low level of overhead. Thus this small business has allowed me to make a living for 2-1/2 decades. It is important to watch these areas carefully, especially as the economy slides into whatever euphemism you care to use. Do not waste money on bank fees, office supplies, office space, and most especially interest expense. Spend carefully, and then make every purchase count. We will, in future posts, get into detail about all these areas, and provide useful information about how to maximize the value of what you buy, keep excellent records, and competently manage the financial area of your small business.

Have a great week!

2008-09-29T08:55:00.000-07:00

Hi:

The development on GO-PAYROLL continues at a good clip. Today, however, I would like to politicize the blog a bit. We are, as a nation, in trouble. We have had an environment of "cowboy capitalism" since 1980. Deregulate this, deregulate that. As a result, we have no one advocating for those of us who pay the real freight and do the real heavy lifting in this country; the middle class. From drugs to banks to airlines to telecom, there is no regulation, there is no consumer protection, no safety net. People are losing their savings, losing their retirement nest egg, their health insurance... I could go on and on. I am not going to advocate a particular candidate. That is not my purpose. But I DO want everyone who reads this to think very carefully about what kind of government they want. I want everyone who reads this to participate and making that kind of government happen. We need to be proactive in order to put things back on track in this country. Get out and vote, and do so thoughtfully!

2008-09-19T09:06:00.000-07:00

Hello. The development project for go-payroll.com continues apace. This week we finished the payroll processing portion of the software, added in the documentation pages and set up a comprehensive test plan. Next week we will begin testing the system with some difficult metrics to expose things that are not easy or intuitive to use. Hopefully this process will allow us to deliver to you, our users, a pleasant experience doing your payroll.

Talk to you next week!

Welcome to GO-PAYROLL

2008-09-12T09:44:00.000-07:00

Welcome to GO-PAYROLL. We are in the process of creating a web site dedicated to providing information about, and the ability to do your payroll on line. If you are a small business with any kind of payroll need, including construction and job costing payroll, we can help. For the last 25 years, we have been providing excellent accounting software solutions to a variety of businesses. Our average customer has been using our applications for 16 years!

Our payroll solution will be reasonably priced, and available 24 hours a day, 7 days a week for your use.

Return to this blog often to see our progress.