6 Keys to a Successful Business

Millions of people dream about starting their own business, but only a few go further than their thoughts. Many people are unsure of the keys to a successful business, especially when today’s business world is full of unknowns, twists, and turns. 

While there are always procedures you need to follow in your business and industry, there are also certain keys to a successful business that apply to any venture. Check this article to find out what they are! 

Key #1. Know your competitors

No matter what type of business you’re starting or running, you’ll have competitors. Even if there’s no other business offering exactly what you plan to sell, there are likely to be other products or services your target customers use to satisfy their needs. Moreover, other businesses may be doing something right that you can implement in your business to make more money.

To succeed, you need to research the competition and find out as much as possible about what they sell and how they sell it. Competitive research is something you should plan on doing on an ongoing basis, too. 

If you’re running a coffee shop, you can visit your competition’s cafes, ask other customers what they think, and gain helpful information. However, if you’re running a business with much more limited access to your competitors, such as a chemicals company, you can take a different approach to research your competitors. For example, you can consult with a business professional and accountant to go over their financial information, not just what the business presents to the world. 

Key #2. Do market research

Market research is one of the main keys to a successful business. Entrepreneurs should never throw their caution to the wind and start businesses based solely on personal opinion. Business success depends on many factors, with data being one of the most fundamental. And data comes from research. What is the size of the possible customer base, and what are their characteristics? It is important to understand what drives and motivates the buyer personas to target them efficiently.

Key #3. Have a detailed plan

An accurate and precise business plan can help you focus on your goals. You’ll refine your business idea as you create your business plan, and you’ll have a roadmap to refer to before making major decisions. What do you expect from your business? How long will you take to achieve your goals? What is your monthly or quarterly target? 

So, whatever your goals are, write them down and put them somewhere where you will see them every day. Then take each goal and break it down into smaller steps. You can set a certain time to review your plan and mark what you have completed. Having a clear direction will bring you closer to your goals. 

Key #4. Provide great products or services at a reasonable price

In today’s hyper-competitive business environment, your business’s products or services need to be good enough to meet or surpass the clients’ expectations once the customers are there. This is how you turn your customers into brand ambassadors, which is one of the best and most cost-effective ways to get a small business on the map.

The first principle to consider in establishing any new product or service is to determine if it meets an actual, existing need that customers have right now. No product or service can succeed unless it’s somehow unique and superior to its competitors’ products or services. A new product or service must solve a consumer problem or improve the client’s life or job in a cost-effective way.

The safest strategy here is to start with a common product that already has a widespread market and then figure out how to improve it (e.g., provide faster delivery, produce higher quality, or lower the price of the product or service.) It’s a good idea to start with a product or service that people are already using and find some way to make it more desirable, instead of trying to invent a whole new thing. 

The second principle for any business success is offering good quality products or services at a fair price. Your business must have a unique selling point (USP) if it competes with other products or services. It is one or more features or benefits that make your products or services unique, different, and superior to any competitors.

Key #5. Keep your records organized

All successful businesses keep detailed records. Proper bookkeeping helps you know the business’s financial status and what could potentially become a problem moving forward. Knowing this helps you visualize future projections, create strategies to overcome those challenges, and assist in business planning. 

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Most businesses are choosing to store their records physically and digitally. By constantly backing up digital information, especially when it comes to financial data, a business owner no longer has to worry about losing their data. If you choose to keep physical records to ensure that the digital information is correct, keep specific folders for each aspect of the business appropriately labeled and organized so you and anyone in the company can access them easily. 

Key #6. Be consistent

Consistency is a key component of a successful business. Being consistent means understanding that your business will not likely make money immediately, but you still stick with your goals and never give up. Consistency creates long-term positive habits and produces the results you were hoping for so that your business will eventually make some money. 

The bottom line

Once you know the main keys to a successful business, you’ll have a strong foundation to grow your business. 

In summary, to succeed in the business world today, you need to be flexible and have good planning and organizational skills. Being a business owner means being in a state of constant learning and adapting.

Don’t forget to subscribe to the Shoeboxed blog for more helpful entrepreneurship and success stories for small business owners! 

About Shoeboxed

Shoeboxed is a receipt management application that turns your receipts and business documents into a digital format in just one click by taking a picture straight from your smartphone or scanning a pdf. It automatically extracts, categorizes, and human-verifies important data from your receipts so that you can go over and check your records anytime with ease. Shoeboxed ensures you will always have your receipts securely stored and ready for tax purposes.

Access your Shoeboxed account from your web browser or smartphone app. Stay audit-ready with Shoeboxed for FREE now!

Why Do Small Businesses Need a Bookkeeper?

To any small business owner, keeping track of your finances is essential for your business’s success. However, you may find that handling your bookkeeping tasks takes more time than focusing on the business’s core. This article will explain why small businesses need a bookkeeper. 

Is bookkeeping hard for small businesses?

You’re not going to like the answer, but it is both yes and no. Though this may sound confusing at first, everything will make sense once you understand what bookkeeping entails.

Bookkeeping is an important aspect of running a small business. It helps small businesses organize, store, and analyze financial data. By using this financial information, small business owners can accurately draw conclusions about the financial security of their business.

Without proper bookkeeping, it’s difficult to track and report critical information to the federal government. Furthermore, incorrect reporting or failure in filing might result in penalties and fines.

However, for every busy small business owner, finding the time and energy to maintain your books properly can be challenging and has the potential to cause endless headaches. You must not only be a perfectionist in making sure that no comma, decimal, or number is misinput, but you must also keep track of each employee to ensure that they provide you with the information you require.

That’s why hiring a bookkeeper has become more popular for most small business owners. Let’s read on to see why small businesses need a bookkeeper! 

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Why do small businesses need a bookkeeper? 

A bookkeeper helps you organize documents and records and identify mistakes early

Last-minute stress from trying to find a critical business document can lead to missed deadlines and serious problems. Businesses of all sizes shouldn’t make any mistakes, and regular bookkeeping can help you with that.

A bookkeeper helps you keep orderly records by doing your books frequently, staying on top of them, and not leaving them until the last minute. It will become much easier to find the bits of information you require quickly.

Moreover, a bookkeeper helps you identify mistakes early by tracking the accounts and overseeing daily transactions, ensuring accuracy. By that, you’ll be safe from any unusual transactions or bookkeeping mistakes

A bookkeeper helps you make accurate budget decisions

A bookkeeper keeps your books accurate and updated, with your business income and expenses properly organized, making it easier to review your financial resources and costs. 

Having an accurate budget helps you plan for your business’s future expenses. On the other hand, if you don’t keep your records organized, you might lose control of your cash flow because everything will be guesswork.

A bookkeeper ensures that you’re tax-ready

Whether you like it or not, you need to file your business taxes at the end of the fiscal year. Small business owners need to determine what their business earned before knowing their total annual income. 

Hiring a bookkeeper ensures that you have detailed balance sheets over time and all your financial information ready for tax season, which helps you predict your annual profits more accurately. By that, you will no longer need to spend hours on the tax filing process or find yourself in deep trouble with the IRS.

A bookkeeper ensures your business meets government regulations

We all know that tax policies can change every year. Failing to adapt to the new policies can lead to the termination of your business. One of a bookkeeper’s main tasks is to observe and update the latest government regulations and law changes, ensuring you have proper documents to file taxes, your business’s financial activities are up to date, and help avoid being audited or incurring tax penalties.

The bottom line

Bookkeeping is a fundamental aspect of corporate finances that can impact your company’s growth and profitability. Taking good care of your bookkeeping helps you plan your business budget, keep everything well organized, and get ready for tax season. It’s something you shouldn’t put off if you want to keep your finances in order and prevent the IRS from causing you extra headaches.

About Shoeboxed

Shoeboxed is a receipt management application that turns your receipts and business documents into a digital format in just one click by taking a picture straight from your smartphone or scanning a pdf. It automatically extracts, categorizes, and human-verifies important data from your receipts so that you can go over and check your records anytime with ease. Shoeboxed ensures you will always have your receipts securely stored and ready for tax purposes.

Access your Shoeboxed account from your web browser or smartphone app. Stay audit-ready with Shoeboxed for FREE now!

Top 3 Lessons Learned for Filing Business Taxes in 2022

If you’ve submitted your business tax returns before April 15, congratulations! You’ve successfully passed 2022’s tax season! On the other hand, if you’re still struggling with your financial records and IRS forms, no worries, we’re here to help! This article reveals the top 3 lessons learned for filing your business taxes in 2022. 

Update yourself on tax law changes

The first and foremost thing to remember when filing your business taxes is to educate yourself on the areas of taxation that affect you and keep yourself updated on tax rules and developments. It’s always a wise option to keep track of the current news because things change annually.

The changes listed below are in effect starting in 2022, so be aware of what they entail for your small business when submitting.

Employee Retention Tax Credit

The Employee Retention Tax Credit (ERTC) is a financial incentive for employers who suffered lower revenues or business disruptions due to government-imposed limitations in 2020 and 2021. Businesses and certain non-profit organizations that paid employees despite the COVID-19 pandemic’s obstacles are also eligible for the ERTC, and many beneficiaries are receiving cash refunds. 

Though ERTC expired at the end of 2021, you can still claim this tax credit in 2022. Business owners have three years after the program’s closure to review wages paid after March 12, 2020, to see if they are eligible. The requirements to claim ERTC are the following: 

  • Your business recovered from a significant reduction in gross receipts
  • You haven’t claimed this credit before. 

Excess business-loss limitation

Businesses could transfer net cash outflows backward five years or forward forever in 2019 and 2020 thanks to a suspension of Tax Cuts and Jobs Act provisions. Nevertheless, those rules have been reinstated for the 2021 tax period.

This means that taxpayers cannot claim losses totaling more than $524,000 (for couples filing separately) or $262,000 (for the unmarried). This relates to business earnings and liabilities, notably Schedule C and revenue and shortfalls from pass-through entities.

Furthermore, they cannot use W-2 wages to cover business losses. Husband and wife taxes are paid separately and may result in a tax obligation even if lost income exceeds spousal earnings.

Interest expense limitation

Another tax law suspended to assist Americans during the pandemic is the accrued interest restriction rule, which will be reinstated for the 2021 tax year. This regulation restricts taxable income to the current tax year and cuts the financing costs deduction from 50% to 30% of modified tax liability.

Set up a checklist for filing your business taxes

When you run your own business, you’ll be accountable for keeping track of various critical records and tasks. It’s a good idea to establish a checklist to collect all the data you have to monitor year-round. This checklist helps you identify and collect your important documents (such as the home office or travel expenses) and keep them for tax preparation. 

Your tax status will probably be similar year to year. Even if your tax situation changes, you can still use the discipline you set in place during the year to expand on in the future. A little effort in planning and staying organized can go a long way.

File your taxes as soon as possible

It might be a good idea to schedule and have all of your papers in one place to assist you in filing early and receiving your tax refund quickly. If you are getting a refund, the earlier you file your form, the faster you will receive your refund—which means more cash on hand during this difficult time.

The sooner you file your taxes, the more time you’ll have to correct any bookkeeping problems or locate lost invoices, documents, or invoices. This additional time can go a fair distance toward reducing stress throughout what can be a stressful time of year.

Additionally, filing your taxes as soon as possible might help you overcome your financial flow. It’s critical to keep track of your 2022 quarterly tax estimate requirements since they may be changing continuously. 

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The bottom line

When filing your business taxes, remember to use Shoeboxed to save you time and hustle!

Shoeboxed is a receipt management application that turns your receipts and business documents into a digital format in just one click by taking a picture straight from your smartphone or scanning a pdf. It automatically extracts, categorizes, and human-verifies important data from your receipts so that you can go over and check your records anytime with ease. Shoeboxed ensures you will always have your receipts securely stored and ready for tax purposes.Access your Shoeboxed account from your web browser or smartphone app. Stay audit-ready with Shoeboxed for FREE now!