I have a medium-sized business and I struggle when trying to understand the annual accounts my accountant gives me. Are there any tips on improving my knowledge?
Feargal replies: It sounds to me like there might be a wider issue here. The most successful businesses who are focused on their numbers are now operating on monthly accounts. So I don't understand why your accountant is still producing annual figures unless you have instructed them not to move them to monthly. It is impossible to run a business if you are only getting sight of the key figures annually as the timespan between results is too long to be able to take meaningful action.
Having a good accountant is really important and this person needs to be proactive, challenge the business and help set out a road map for you on how to improve the various different figures.
Perhaps your accountant has been suggesting these things and you have been ignoring them or you view possible additional cost as a negative aspect. I would view it as the reverse and would encourage you to spend slightly more to get a more frequent set of reporting and ongoing meetings with your accountant.
While I was always famous in Superquinn for jokingly saying "Don't let the accountants take over", I also recognised the critical importance of having a good accountant in a business.
In a case like yours where you have a tight management team and you can't afford a permanent in-house accountant, then your external accountant is a valuable resource.
You have two choices here. Sit down with your accountant and restructure their input in the business provided they are proactive and understand the intricacies of the business. Alternatively, you need to change accountant and find someone who can provide this new service. With regard to understanding the figures, your accountant should be able to give you some training with regard to this and it might be worth having a conversation with your Local Enterprise Office who sometimes provide workshops on this topic.
Q I am planning to launch a product targeted at the hardware/DIY sector. I have bought a logo on one of the online websites and need some advice on pack design.
Feargal replies: You could be about to make a big mistake from the information you have given me. While there are lots of great online sites which allow you to buy predesigned logos, these usually do not fit with the overall brand design process and you end up 'bolting together' a series of disjointing pieces. If you are planning to sell a product at a farmers market, or a less formal retail environment, then a simple logo and branding would suffice.
However, you are indicating that you are going to go into a mainstream market to compete with other brands and the retailers' own private label. Branding and packaging are the key determining factors as to whether a product succeeds and it is the one area I would advise you to invest the appropriate money at the beginning of your business. It could grow the value of your business enormously and could be the difference between success and failure.
Ideally you should be going to a brand design agency with the expertise not alone to create the appropriate logo, but also the brand messaging appropriate to your product. The brand is not just about the logo but rather the wider messaging that goes with your product. This branding will extend far beyond your packaging onto websites, social media, etc. While there will be cost involved, I would encourage you to shop around and make comparisons. Very often work streams like this are eligible for grant assistance through your Local Enterprise Office. Study websites for help available for young companies.
Do you have problems with your small business? Email Feargal at firstname.lastname@example.org