Good afternoon and welcome, everyone. My name is Scott Stearsman, and I lead our small business team at Truist. I'd like to start by welcoming all of our clients who have joined us today. Thank you for choosing Truist for your financial services. We also welcome any businesses who are not Truist clients. I know we have a number of Truist branch leaders with us today as well, and we'd like to thank you for the work that you do in helping our small businesses in your local communities.
As we always do it Truist, we start all of our meetings with our purpose. Truist is a purpose-driven company. Our purpose is to inspire and build better lives and communities. We value and celebrate the small business owners. You're at the center of our local communities. We're committed to helping our small business owners succeed at every stage of your business through the products and services we provide and through the expertise we share.
Today's webinar is an example of that. Having good bookkeeping practices is important for every small business, and we are happy to partner with Intuit to offer this webinar. This webinar is a continuation of a quarterly series of webinars on topics our small business clients tell us are top of mind for them. So thank you all for joining us.
In today's webinar, we'll start off with an expert perspective from Mike Skordeles, our senior US micro strategist at Truist on our current economic environment and relevant points for small business owners. After that, Mariette Martinez will provide information to help you better manage your finances year round. We also will be joined by three business owners who will share their perspective and experiences. So with that, we'll turn it over to Mike to start us off with his thoughts on economic trends that are most relevant to our small business owners today.
Thanks, Scott. Economically, things look pretty stable right now, particularly most of the economic data. That said, as we look ahead, there are some storm clouds that are gathering-- particularly rates. We've seen rates jump around in the last couple of months, particularly as we've moved into March, and that does give businesses, both lenders and borrowers, somewhat of a pause.
And what that means for small businesses is that certainly as we see rates jump around, it makes it a lot more difficult for not just lenders but also borrowers to try to guess where things are going and whether they want to finance a piece of equipment or carry things like their inventories and other things. So it does start to tighten financial conditions even more than we've already seen.
And if we see lenders leaning back a little bit because they're scared of rate volatility, that means that overall, it makes a tighter environment for not just businesses, but also end consumers to finance things-- whether we're talking about cars, homes, or other things. And that economically, it means that you start to see things shrink a little bit. And again formal name for shrinking is a recession.
Our call is for a recession in 2023 because of those tightening financial conditions. But again, this rate volatility and jumping around that we've seen does make it a little bit harder, especially for small businesses.
We take it a little farther is that small businesses, as we know, tend to use unsecured credit, things like credit cards and other things, particularly for the smallest of small businesses or micro businesses, and so these higher rates that we've seen over the last few months really ratchets up pressure, not just on consumers but also these micro businesses. So again, that's another headwind as we move forward.
That said, all is not lost. We don't see a calamity on the horizon. And it does look like between the Treasury and the Federal Reserve and the FDIC that things within the banking system seem to be fairly stable. Again, yes, there were a couple of banks that were rescued, but over the course of a normal year, you typically see three to five bank failures that work their way through the system, and again, aren't something to really be overly worried about for small businesses.
That said, the environment does remain pretty constructive for small businesses. We do see a recession in the back half of the year, but the overall environment the last couple of years has been a focus on expenses. These are things like hiring and firing, but also input costs for things that have seen a lot of inflation in recent years.
So for most businesses, prices have been, at least for input costs, have been stable and in some cases even falling. So the overall environment is a little bit better than it has been particularly compared to 2022. So with that, I'll throw it back to you, Scott.
Thanks, Mike, for that really great information. Now I'd like to introduce our featured speaker and small business panel. Today, we have Mariette Martinez, the founder and lead educator at Master Your Books, a learning center designed to empower growth stage entrepreneurs and their value-driven accounting partners through business and accounting literacy.
After two decades serving as a small business account and tax advisor, Mariette is on a mission, alongside her education partners, to deliver action-based learning so that no business is left behind due to the lack of community support and the knowledge and skills to empower their dreams and goals. I'd like to introduce our small business owner panel first.
First, we have Janette Kinard, who is with Champion House of Care. Second, we have Ivy Mak, who is with The Cactus Club. And finally, we have Michael Angelicola, who is a consultant to small businesses and has a couple of businesses of his own. Thanks, everyone. With that, I'll turn it over to Mariette.
As we start today's session here as a panel and as a small business community, we're going to do it in a storyline. I believe it's so important when we come into small business empowerment to relate to the story. So all of this discussion today is going to be in a storyline, and we're going to bring your small business owners into the story throughout today's show.
So let's go ahead and quickly talk about the four stories that we want to cover. We want to cover the business money story, the accounting story, the money tracking story, and we're going to bring in QuickBooks to share the magic, and then the partners story.
So let's start with the business of money story. When we talk about money, many times there are a lot of stories related to money. If you really think back, the first time you heard about money, maybe it was when you were first growing up, and it was a very personal connection on how you were going to grow up and start building wealth.
But when we talk about business money, we really need to pull that story out and just focus on the entrepreneurial journey, and that's what we're going to be doing today. And when we do that, the actual story gets simpler for everyone because the business money story can actually be built out by every entrepreneur in two ways. You can focus on who is part of your story, and you can focus on what is the business story.
So we're going to start with who, and I love sharing the who, because yes, the who always starts with you. You the passionate entrepreneur that had a vision, that had a dream, and that had a goal to build wealth through entrepreneurship. But I'm going to have to quickly pivot you out of this story because there are other players in the story. The customer, the customers who you are ideally searching for so that way they can build out your story further by buying your product and services.
The vendor-- they are the team player in your story that you're purchasing from. The contractors that are helping support your business, and they are the ones that you are buying from in your story.
And lastly is your business team. As you start building your dream, you realize really early on, especially if you started as a micro-enterprise or as a solopreneur, that you have a bigger story, a bigger purpose, and there's no reason why you need to do this alone. So many times, that's when building your dream with a team is the next step on your journey.
So which story are we talking about? Your business story. And when you learn that, what's really important to understand as well is that your business story starts with you but needs to be separate from you.
Your business story may have started with you, but you're just part of the story. So who are you in your story? If you're a for-profit business, you may be an owner, a partner, or a shareholder. If you are a nonprofit, you may be a stakeholder.
So we're going to have some moments to think together and really answer some questions together as a panel. Before we do that, I want to share one thing. Once you know whose story you are telling, how does that actually pay off year round? How does that build better habits?
How it builds better habits is that now you can have awareness around you having to pull yourself out of the story. And many times, that's the number one bad habit or old habit that many business owners have. They want to be part of the story, and many times, they want to mix their money part of the story. And we can't do that if we want to organize a legitimate business that's going to be growing and thriving.
So what do we want to do? We want to start considering what is it like to build a legitimate, organized, formalized business. What are those considerations? Here, I'm just going to bring up a few, but I want to talk to our panel about this.
So of course, some obvious ones are open a business bank account. Separate yourself from the very beginning from the business. Open up business credit line so you can start building that business credit.
Utilize a filing system to stay organized year round and take the stress out of building your business, getting organized, and of course, getting ready for taxes. Utilize an automated bookkeeping system, which we, of course, we're going to go ahead and see some magic in today's session and learn how to pay yourself the right way from the business.
now what about some personal considerations? And these are the ones that I hear really quickly on when I serve my business clients. But I need to put money into the business. How do I do that?
You're absolutely correct. You can transfer money from your personal account into your business account to create those cash reserves. You can contribute cash into the business, but you need to make sure you understand the intention of it. What were you thinking about when you contributed that money into the bank?
We all know that in real life, especially if you're maneuvering many different things in your lifestyle, you may have used some personal cash for the business, but create a ledger to separate that so you can get reimbursed from the business. And most importantly, if there are multiple parties in your business-- meaning a mom and pop business or a partnership-- make sure everybody is on board in regards to this.
So let's go ahead and think about some better habits about separating personal and business, and let's see if we can hear some of the favorites of our panel. Back to you, Scott.
Thanks, Mariette. That was really great information. Now I'd love just to spend some time with our panel and get some open dialogue and feedback from you. Why don't we start with just a little bit about your business and what you do? So Janette, we'll start with you.
So I'm the executive director of Champion House of Care, and where I support teens and adults with intellectual and developmental disability, such as Down Syndrome, autistic, cerebral palsy, the Blind. Giving them life skills, job training, interacting with their peers, but most of all, being involved in the homeless community.
Wow, Janette, you're a saint. Thank you for what you do.
I'm a co-owner at a small local plant shop. We offer a variety of cacti to rare house plants, and we also help style people's home and do interior decorating.
Great. So now do you have a green thumb?
Yeah, I can say it.
I'm not a botanist yet, but a good hobbyist.
That's terrific. Michael?
I own a consulting company, and then I own small bits of interest in a couple of local companies here in Charlotte. Most recent one is Eden, a nightclub that we're opening up in Plaza Midwood. But yeah, a couple of things.
Terrific. It sounds like you're pretty busy. All right. Well, we talked about the players in your story, so describe just for a minute, who are the players in your business story?
Well, most of mine are the parents. They are the corporate companies and local companies that come and support the nonprofit, as well as volunteer and work. And once they volunteer, then the company reimburses us for the volunteering.
That's great. Michael, it sounds like you've got quite a few players in your story.
Yeah, so from a personal development side, it's been my lawyer who's really done a lot of good stuff for CEO training for me and then a previous business partner who acted as a mentor. From a business development side, we tend to focus on clients that we've had relationships with for an extended period of time and not spread ourselves very wide, but focus on just a small network of people to give them good focus.
That's great. We hear from our small business class how important mentors are. It sounds like it's been impactful for your business as well.
Built me to where I am today.
Great. Ivy, how about you?
So it's me and my business partner who deal with the everyday work. We have a good account that helps us with the logistics stuff, and we do have a part-time marketing person who helps us with online shipments and stuff.
Sounds like you've got a lot of great partners.
Yeah. Mariette also talks about the importance of separating your business and personal accounts, so talk a little bit about how you've done that.
For me, at the start, it was very tough just because at my age, my personal life tends to mesh entirely with my business life. I don't really do many things that aren't related to business. I've built my businesses around things that I like to do. If I like to go have a drink, I'm going to go have a drink at a place that I own. If I'm shopping for shoes, I'm shopping at my shoe store, little things like that.
And so now that I've gotten to understand the pitfalls of that, structuring my time surrounding my finances have been big for training me personally in my own habits and actually paying myself the way that I'm supposed to pay myself and then allowing what's supposed to be a reasonable business expense to stay there and not shortchanging myself, even in that as well. Recognizing what is considered reasonable compared to what's not and not being scared of claiming that reasonability, and then just making sure that I'm covering my own bills on my own.
That's a lot of great best practices right there and true from personal experience. Just describe maybe one of the pitfalls, if you wouldn't mind.
So recognizing that, for instance, leasing my car as my business. That's my personal car. Where most people will start a business and own the car and not realize that they can lease it to their own company and making sure that expense stays within the company if the company is what's using the car the entire time.
Right. Really good. Thank you.
So starting out, just an initial investment that learning how to pay yourself accordingly and the amount of expenses we have, what is going back into the company towards inventory, paying people out. It's just difficult at first, but QuickBooks does help a lot.
But it does give you sections like how to manage your money better with the business and personal.
That's terrific. Spoken from experience. Yes. Janette?
Well, mine's a little different considering I'm a nonprofit. A nonprofit starts out with nothing.
So you're really coming out of your pocket a lot, and you find out that you try your best not to mix the money, and you know you can't mix the money because then the government gets you, so you have to keep that money separate. And you make sure that the nonprofits start getting donations and grants, that way it can carry its own weight. So we don't mix the money at all.
That's good. That's good. Ivy, you talked about QuickBooks being a great resource and tool for you. Are there other tools or software services that you use?
We use Shopify for online sales, but everything that we do is do QuickBooks.
Just for like accounting, because you can send your report straight to your accountant, and then like everyone-- not everyone, whoever you want to have access to it, and you can just take a picture of your receipt and just send it to QuickBooks. Like, it's great.
So I tend to take on bookkeeping role for a lot of my companies that I have my ownership in. And so we like to use Asana, as well as project management software to make sure that transactions are taking place and then have a record of those transactions with memos tied to what they were for. So when it does get passed off to our CPA and our EA, they know they have a full log. We're not having to go back and forth on Excel spreadsheets and things like that for them to have all of the information tied to each expense.
So I use Microsoft. They have a nonprofit platform, so we do use the Excel spreadsheet. But after talking to Ivy, I'm going to switch over to the QuickBooks.
I like it. I like it. That's terrific. OK, with that, Mariette, we'll turn it over to you.
Well, I just want to share that I love the variety on the panel from nonprofit to for-profit, and I love the lessons learned. There's nothing like hearing true lessons from small business owners from inception to learning a few years in. And of course, those that watch this are getting that head start, so I love that.
And then sharing the whos. So I tried to keep my whos very simple, but you all shared so many more whos in your team, so thank you for that because that gives just so much more context to what we mean by who is on our team.
So now actually let's cover the what. And interesting enough, many of you already talked about what, so we're going to go ahead a little deeper into it.
Now, I'm going to take what from a perspective of an accountant of over two decades serving my business owners and wanting to set them up for success. And this is essentially what I go through with them when we first have our first consultation.
So we're going to use a real-life example. Of course, this is an example of many, many business owners that I have served over the years. So Maria Hope is super excited. She opened her new business, and she has a business called Her Business Master VA Services, and she's a limited liability company. She provides graphic design and virtual services for her clients.
So if you can see very quickly, I move Maria Hope over to the side. Yes, she's the sole member. She's super passionate about her business, but we need to focus on, what, the business story.
So Maria has to move over to the left for a moment, even though we know she's the visionary, and we need to talk about Her Biz Master VA. And what we do when I meet with my clients-- so here's an example-- is we build out two key areas of their business. The first one is called their business profile, and the second one is called their accounting profile.
I'm sharing this because I have found that this is a very important best practice that entrepreneurs should understand and be aware of, especially if they've never done it before. And more importantly, that accountants and bookkeepers and tax professionals that are serving business owners really should be using this best practice. So let's just quickly cover it because, of course, this could be a very long session.
The business profile is where I pull up some really important items of that business. The company information, the owners of the business, their legal and tax entity type, which has a huge impact on how we're going to set up their accounting infrastructure. How many years in business, who are the players in their business, and of course, the industry in the infrastructure.
And here is an example of what it would look like just initially as we're actually documenting this right inside of our meeting. I know the business name, the owner. I quickly learned their legal and tax entity type, how many years in business. And of course, my wheels are turning, but I'm staying quiet, and I'm just listening to the business owner.
But what pops out at me when I'm listening is legal entity, tax type-- meaning, how are they filing for taxes? Their specific industry and their specific infrastructure. Why? Because those lead into the next story, which is the most important story I hope we share in today's show, which is the accounting story. How are we going to set the business owner up for success?
So the accounting story is actually built up the second profile, which is called a business accounting profile. The business accounting profile, as I mentioned, starts with that infrastructure of the business profile, but then we go deep dive into accounting.
First, we've got to get real transparent and real vulnerable, and I have to ask them, what is your knowledge? What is your financial literacy knowledge? The reason why I do that is because many times there's a lot of shame in not having this financial literacy knowledge and awareness, and I want to empower them.
And so what I do very quickly is if I realize we are not using the same language that they're going to be lost for the next 45 minutes, I go ahead and pull back and say, let's just do some financial literacy 101. Let's make sure we're using the same language because this is the language we're going to use throughout our relationship together. Once we're speaking the same language, then we can go back into their profile.
We can set up their chart of accounts, build workflows and processes, choose the right accounting solution for them, which we hope is QuickBooks, but it may be another one. And then more importantly, I want to make sure that they feel that accountants, bookkeepers, and tax professionals, and all of the other great business partners out there are really locking arms with them, and we're partners, and we want to have a relationship with them. That all happens when we're building a business accounting profile.
So I actually want to jump back quickly to the panel here because I'd like to hear some practices you've done, either on your own or with your accountant bookkeeper or tax professional, in regards to building your accounting story. Back to you, Scott.
Thank you, Mariette. So that's a great question. I'll let anyone take that question from Mariette.
I had to learn a lot from my accountant how to properly expense what needs to expense. Like where he was saying getting a drink, so your meals and entertainment, but your hotels are separate, but you can't expense so much because there are some other accounting things that I need to learn about. It was just so much to learn about, but it's a lot of questions that I have to still ak too.
And who do you ask? Who do you lean on for those questions?
The banker and my accountant.
A lot to my accountant.
Something big for me was to learn to be proactive instead of reactive. Kind of working on tax strategy before tax time so then you're prepped. Making sure that your company is structured properly so you're not getting double taxed.
I get a few K-1s, which is just trickle down and come from other companies. And I remember my first time getting K-1 from two companies, and it doubled my personal income on my tax return. And I am still on a payment plan for that tax return, and that's years ago.
And so being proactive and making sure that you are working with somebody that focuses on tax strategy, not just somebody that just preps your taxes, but actually says, no, put your money here to avoid this and this right. And then also recognizing that tax code is, what, 4,000 pages, something like that. Only a couple of percent of it is about how to pay taxes. The rest is about how to strategically not have to. So being aggressive and learning that and educating yourself to make sure that you are empowering yourself properly to be able to write off what you need to write off.
It sounds having a plan and from experience helps you avoid those unexpected surprises.
Well, mine come from being with my treasurer and, of course, being with my banker. Teaching me right and wrong and the way donations are supposed to go and how they're supposed to be used and what donations are reimbursable, so that we make sure we keep everything in line so when time to do taxes, we're ready.
That's great. Mariette, some really great testimonials from our panel here. I'll turn it back over to you.
Thank you. Yes, I love that I heard a lot of the language we're all trying to learn here, and that actually ties so beautifully into the accounting story. So we talked about the accounting story being built from the business accounting profile. And I also shared that, of course, this is an extensive conversation that you'd have with your financial partner, your financial professional. But today, I wanted to pull out two key areas that I really want to highlight in regards to going deeper, and those are the knowledge and skill set that I heard you all said it was important. And it's ongoing. It's ongoing.
Of course, again, the tax code, accounting language, what's unique to your business. This is an ongoing learning, but we're going to discover a quick way to learn it, and the second thing we're going to deep dive into is bookkeeping tools.
And I like to share this story from the perspective of some universal truths that hopefully will calm our nerves and help us feel that we are all on the same playing field. The first one is the truth about tracking your money transactions and how to build this accounting story.
So I want to bring in business owners, and I want to give you a real example. And I love this because I feel like it ties so great into today's show. When I asked them, so how do you track your money transactions, and then this is what they'll say.
Oh, I bought a new computer. Oh, I have to pay back a loan. Oh, I put my money into the business, and so I had to take my own savings and put it into the business. Or I just did a whole day worth of hair services, and I got cash, and I also got paid by credit card. Or I spent the day piling up my business supplies.
OK, all good answers, but guess what we're not talking here? We're not using the same language. And so when they go and say the same thing to their accountant, the accountant will be using a completely different language, and that's where the disconnect is.
That's why many times business owners and their accounting partners cannot-- there's a huge gap in their language. So let's fill that gap right now. Let's do that with accounting language.
And guess what, everyone? Accounting language is super simple. Yes, I'm saying that. OK, accounting language can be super simple. Let me show you how.
Here is the simple universal accounting language. This is how you want to speak initially when you think about how you spend in your business. When you're tracking money in and money out. Because if you use all of the examples of what you did, then you are going too far away from the five key categories on how you actually use that money.
Here are the five categories. You either invest it in an asset, you have to pay a liability, or you're building equity. Or you have some income that came in, or you paid out some expenses. That's it. Five categories in regards to how you actually made a money in or a money out transaction.
Now, what it actually is is the detail or description of the transaction, but every single business transaction has to be one of these five things. Now, let's actually explain each one of these things.
An asset is what a business owns-- what they purchased of value and that's increasing in value. A liability is what a business owes. They can owe it to their creditor, a lender. They can actually owe it to you if you actually contributed a loan to the business.
Equity is going to be the obligation back to the owner. This is an area that can get very confusing because people say, what do you mean? Well, equity actually includes the earnings of the business and any transactions the business has received from the owner. So that's an obligation back to the owner, and that's why understanding that you and the business are separate is key because now the business is obligated to you.
Now, these two are much simpler. Income is revenue from product or services sold, and expenses is the cost to sell or produce or operate your business.
And that's it, but here is where I get so excited. Once you learn these five categories, what you actually did is build the heart of your accounting story. The heart of your accounting story is two-sided, which is assets, liabilities, and equity on one side, which is your balance sheet, income statement is your income and expenses on the other side, which are the two key and most critical financial statements for any partner that wants to work with you.
And that's the truth. That's the business accounting story. So let's bring our business owners again, and let's hear what they have to say after they learn this language.
So Mariette, I bought a new computer, which means I just purchased an asset. Hey, Mariette, I have to pay that loan back from the bank. That means I owe a liability and have to pay that back.
You know what, I had to go ahead and invest in my business. I use several of my savings, so that's my equity, right? Yes, that's your equity.
I received cash and credit card today from my hair services. That's income on my income statement. And I went ahead and made purchases today for my business. That is expenses that you made for your business. And those are going to be found assets, liability, equity on the balance sheet. Income and expenses on the income statement.
And that's how you build your accounting story. It's that simple. So I would love to hear from our panel. Does this learning path resonate with you? Have you gone through an exercise like this with your accounting partner or maybe even taken a financial literacy class? How have you become financially empowered as a business owner? Back to you, Scott.
Yeah, wow, Mariette. Really valuable, simple, the accounting language. So what are your reactions to what Mariette described?
I had to learn when I started with my accountant, he had to explain to me us owning two vehicles if that's the asset part or the equity part. I was so confused at first, but like now I'm like separating everything slowly, but it is challenging at first. But eventually, it gets easier and knowing what you can expense and what's income and what you owe and what you do own and stuff, but it's a lot.
Yes, yes. So I repurchased my home into the nonprofit name. So that way, I can get the equity out the house to supply income to the nonprofit.
Interesting. Now, did you have advice along the way to make that happen?
I did have advice along the way, thanks to my banker.
She advised me on what steps to take and how to go through with it.
Simple is better. Make a clear story, easy to process. You get too detailed, you can confuse people and then say you catch an audit or something like that, that's four years back. Simple story is better as always. It's just easy to follow, easy to track, easy to trace. And you don't necessarily have to speak too much as well. Your paperwork can tell the story at that point.
Right, right. Really good information and practices. Mariette, so I'll turn it back to you.
Thank you, and yes, I love that. That's really the key objective or goal that I have when I teach that story, and you're absolutely right. It takes time of course I've been living this story for over two decades, so it probably comes out like I'm saying my first name.
But interesting enough, as our panelists said, it's about keeping things simple because we need to remember who is actually looking at this information-- bankers, auditors, accountants, investors. And we want to be able to have that simple story, and then eventually if someone wants to dive deeper into our story, then that's when having a software is very, very beneficial. And actually, that's a good lead in to money tracking.
So we're going to start with the accounting language, again, and assuming that we're all tracking using five main categories-- assets, liabilities, and equity to build out our balance sheet. Income and expenses to build out our profit and loss.
OK, but where do we actually start? Let's just give a really simple real-life example if you are just starting from the beginning, because we want to empower all entrepreneurs in today's show.
So just imagine that you're trying to figure out, OK, well, I need to grab some kind of document and start this exercise. Isn't that correct? Absolutely. And guess what is the best document to start with.
A bank statement. You just start with your bank statement because that is ultimately where everything should live. Now, I want to just have a caveat here before I go any further. I'm not saying only use bank statements to track your money in and money out. You need to substantiate these transactions through source documents, but it's a very good place to start.
So let me give you a very quick path on some best practices. You grab that bank statement, and first, you look at the descriptions to start seeing what it is that went in and out of the business. Secondly, you add a column-- literally, you could do this either right on that PDF statement, you can do it on a actual physical statement, or you could export it out and do it. But you want to add that column because you already want to start training and learning, OK, so I have this particular money in or money out, but let me think about it from the accounting language.
And the third thing you're going to do is you're actually going to go ahead and go line by line and you're going to say, is this an asset, is this a liability, is this an equity, is this income, or is this expenses? And I want to just pause for a moment, and I need to be very clear about this. There are many business owners that believe that everything on the money in column is income and everything in the money out column is expenses.
Please, if there's anything you learn from today, that is absolutely false. OK, there's a lot of money in transactions that are not income and a lot of money out transactions that are not expenses, and that's why this exercise is super important.
And lastly, have fun with it. Have fun. Get some highlighters. Highlight the different accounts and have a little bit of fun with this. But let's also be very honest, this is maybe what you're thinking right now-- really, Mariette? Have fun with it. No, this doesn't sound fun at all. This sounds very manual, and there has to be a more efficient way of doing things.
And yes, of course, there is, and that's why we were excited to partner with Intuit in today's show because there is an absolute more efficient way to tell and document your story, and that is with a bookkeeping system. An automated bookkeeping system has many, many benefits. I'm just going to share a few of why it's important for you to build a financial and digital platform.
Of course, you can track all your transactions in one place, and now it's automatic because it's automated. You can spend smarter because now you have visibility, and you have this visibility in what's called real time. So many accountants use that phrase, do you want it in real time? All that means is, do you want it all the time? Do you want to be able to see your books and know what you're looking at?
Of course, there are a few other examples-- being organized, being audit-proof, being abreast of the new technology. And of course, in today's show, making sure you're separating business and personal. But what else should a strong bookkeeping system provide?
Now, what I wanted to do here for all of you is I did want to bring in QuickBooks for a moment because it's so much easier to highlight this example with a real-life accounting solution. So remember those players? Remember those players?
Again, I kept the players simple on purpose because I wanted to think about you, I wanted you to think about your customer who's paying you, I wanted you to think about your vendor who's your paying, and I wanted you to think about the possibility of you scaling. What does it look like for you to scale your business?
And what I love to call this exercise, which is a completely new meeting I'd have with a business owner, is let's build QuickBooks as the core of your bookkeeping system. And what does that look like?
What it looks like is first the business owner says, I was told I just need an accounting system, a general ledger, my debits and credits. I need my accounts in there. And I go, yes, OK, that is the formal reason why most people need an accounting solution, but let's think differently about that. Let's think about what you want. What are those pain points?
As soon as I change the perspective and allow the business owner to dream and actually share what their pain points are, this is what really comes up. Well, I want it to be automated. I don't want to have to think about it all the time. I want to be able to easily categorize things. I don't want to manually do anything.
I want to be able to do reconciliations because we heard from our accountant, and that needs to happen. I want to be able to pull out my very important financial statements, my balance sheet, and my income statement because I need to show that to my banker. I need to build out cash flow statements because cash flow is the number one reason why businesses fail. So on and so forth.
As that discussion happens, then what I allow them to do is I go, OK, but now you need to explain to me how you work with your customers. And they say, well, I need to be able to track my sales. I need to be able to build workflows on day-to-day how I work with customers, how I'm going to invoice them, and how am I going to get paid from them.
And so essentially, what happens with an electronic system is you take those same team members, and you help the business owner to develop and customize their QuickBooks to their particular needs. And the most amazing part, at least for me, in this journey is when we get to the growth part of this conversation. How can businesses use accounting, technology, automation to actually grow their business? And that's the exercise that I go through with my business owners when we want to focus on QuickBooks.
So I'm going to go back again to our panel. How have you built out your bookkeeping system? And more importantly, how have you built it out to grow alongside you? Back to you, Scott.
Thank you, Mariette. So let's talk about that. What bookkeeping system do you have in place today?
QuickBooks. All right, so why QuickBooks, and how is that helping you manage your business?
It was hard at first learning how to link your bank accounts and expense certain things, but I do like QuickBooks. It offers those reporting to you in real time because it lets me print out by the month, by the year my loss and profit, so I can track what I'm doing good at or I have to change certain things or I'm expensing too much or anything like that. That's what I love about QuickBooks the most. And also my accountant has access to it 24/7.
That's good. What a great testimonial. Easy.
All right, Janette. So running a nonprofit, bookkeeping is really important. So what tools and advice do you have?
Really important. We've been using Excel, but we're going to change over to-- yeah, we're going to change.
So you see the value.
Yes, we see the value. We see how there could be a difference, how it can be much easier if we just use QuickBooks. We can keep a better track of everything.
OK, I'm going to keep pushing you here a little bit. So you've been a client for 30 years.
So thank you for your loyalty. How has your bank helped you with bookkeeping and management of your business?
Well, she's taught me how to get a credit card, first of all.
She got our credit card.
Be able to track your business expenses.
Yes, so we can track how expensive. We invest in a CD so that we can have some other equity and everything sitting there.
She keeps me on track if I see where I'm getting down too far. Then she's like, hey, we need to look at building this up some and make sure you don't take out too much. So she's been a great help.
Sounds like she's been shoulder to shoulder with you for quite some time, and she being your banker.
Great. That's terrific. Michael, running multiple businesses, bookkeeping has got to be really important for you. How do you keep track of all of your records, and especially when you have multiple businesses?
So QuickBooks for actual tracking of expenses. We've trained it to do the automation, so it'll track if it's coming from a certain vendor. Typically, it'll be thrown to this, and it'll categorize itself. So I use that for expense reconciliation.
And then from a standpoint of knowing what I can use to reinvest or what access will cash and my schedules, we just have a simple Excel calculator that I have a page for each one of my businesses, and I just track cash on hand, expected sales this month, expected sales next month, OpEx this month, next month. Just those kind of things. And I'll just throw out a number at the end of the two-month cycle and say what I'll have after that, so then I'll know when I can spend what to try to increase that.
Yeah, it sounds like you've got a great system in place.
How about your bank? How has that helped you along the way as well?
So banks have always scared me. I've never been a big fan of banks. Coming to Truist, shout out to Courtney, she has been awesome, honestly. I've gotten so much education working with her specifically.
I've always done very well when it came to an income basis, but I've never looked too good on paper, and I've never been approved for a credit card. And it took forever, and I've been in an entrepreneur for coming up on eight years right now. And so this was my first year that I got a credit card for myself and also for my business, and she was able to get me credit cards for multiple companies, and that has just grown my companies drastically because I've never taken an investment.
It's always just been what money can I put in, and that's how I get started and I bootstrapped everything that I've done. And so now being able to use OPM, Other People's Money, and grow my business and then pay it back quick and continue to grow it and get increases. Honestly, working with Courtney has been-- I've doubled my knowledge on how to be efficient with my finances.
That's terrific. So it sounds like great bookkeeping, great tools in place to help with that, but also the importance of having a banker along that journey with you.
Oh, absolutely. If they don't know the banking system properly, they're not helping you. Right. It's like it's like using an accountant that doesn't understand tax strategy. Like you don't know if you're paying too much taxes or not and they're not empowering you. So making sure that you have a banker that teaches you how to structure yourself to make sure you look like somebody that's good to loan money to. That's very valuable.
That's right. That's right. And that's why it's so important to have that relationship and create that journey together. Yeah. Thank you, Michael. So Mariette, it sounds like you've got some great testimonials here. You've got clients that aren't QuickBooks users but soon will be QuickBooks users from what you've described. So I think everybody now sees the power of QuickBooks.
Yes, I love it. And the last quick story we're going to share I think it's going to go back to the panel real fast because you've already talked about it, but before we do, I wanted to share for those nonprofits out there, please visit TechSoup. TechSoup is an organization that provides massive discounts to organizations so you can get QuickBooks at a discounted rate at TechSoup. That's the organization.
So make sure you don't purchase it just offline, on the website. And QuickBooks is OK with me saying this, by the way. They're aware of TechSoup.
And then in regards to the conversation about using Excel for cash flow forecasts or cash flow planning, I love that example. And I only share that because many times people think, oh, so am I only using QuickBooks?
Many times, you're exporting your transactions or your specific reports out of QuickBooks to create a more developed system, like cash flow planning to be honest, is much easier on a spreadsheet. I personally like to use Google Sheets, but the idea is to use a spreadsheet method to do that heavier cash flow planning, so I really love that example I heard.
OK, so the last story-- and this is going to be a quick one-- is to just remember the players on your team. But more importantly, to remember that there are more players on your team, which many of you already mentioned them already. So Scott, you're going to have to get creative here to see who else they're going to mention. The accountant, the attorney, the banker, the coach-- I heard that several times.
So I do want to go back to the panel though and just talk just a quickly about that. What does it mean to truly know that you are not alone and that there are so many more players on your team? Back to you, Scott.
Thanks, Mariette. Really great question. So you have to leverage so many partners along the way as a small business owner. So just talk a little bit about who's influenced your journey and your success.
Who's influenced my journey, I would honestly say my banker. That's a given.
Miss Janet and Miss Barbara, they've told me, hey, you can push. You can do this. They taught me how to separate myself from the company, from the nonprofit. And told me that, hey, now we're going to get you a credit card, and we're going to separate you from everything so that way you can grow bigger and better and become more at this nonprofit life.
So they have been my inspiration to say, hey, you can do this.
Wonderful. And you're not being paid to say this, right?
No, I'm not being paid to say this.
No, not at all. They didn't pay me.
I would actually say our customers. They push us to do better and want to grow and learn and do more things. Yeah, I think our customers play a big part.
And be on our team.
Yeah, from a not necessarily answers your question, also answers a little bit of what she was pushing. The importance of partners is huge. Also recognizing that a business partnership is like a marriage. Like it's contractual, and you have to know who you're getting business with.
A really valuable lesson I learned was a lot of people that I brought on as partners in my early on businesses, I could have just paid a salary to and gotten 10x the work out of them because they weren't entitled with ownership, and so that was really big for me. And then partnering with people that actually really care. And so--
I love that.
We were in one of my companies, a small story, but we removed pretty much every equitable owner that was there as a founder besides me, and then I've brought two of my first employees that have been with us for almost three years and made them equitable owners, and now they're shareholders. And they care more than anybody I've ever met. Honestly, they take more pride in it than I do.
And so the value of partners is tremendous. You can do a lot on your own, but you can go very, very far with a team. Because we're humans. We get tired. We're going to have off days. We're going to have cycles. And so you fill the gaps, you support your team.
Amazing. Thank you. Yes, I think you filled that perfectly. Thank you. And I love it they brought up different team members, and I just want to highlight the customer.
Many times, we have customers, and we have that purview that the customer is just-- we're serving them and they're paying us, but I love the idea of them being our partner. In my case, as an educator, my learners, who are my customers, are absolutely my partners because I need to hear from them on what they need to be empowered in next. So thank you for sharing that customers are our partners, and I think Truist is a great example of that as well, so thank you for that.
So let's wrap up, everyone, just with a few things. So we talked about knowing the business money story. We hopefully brought in some good money habits. I would say the business panel brought in amazing money habits. We also talked about the importance of building that confidence, the financial confidence through language, and this takes time. It's not going to just be today's show. This is a continuous learning journey that you're going to choose to be.
We covered a lot about the power of partners, so thank you so much for that. And I also just wanted to highlight two resources. Intuit QuickBooks has a very powerful Resource Center that you all can go to, and there's going to be a related blog. That is going to be launched alongside this show specifically on separating personal and business finances, so I'll be super excited when you all can access that too. It's a Truist and Intuit blog that they're partnering on.
And before I go, of course, I just want to give a huge thank you to Intuit QuickBooks, to Truist for allowing me to be here. And I also wanted to just share this really important part. Even though we talked a lot about separating you from the business, you are the business. So the next time you want to invest in yourself, remember, you're also investing in your wealth. Thank you everyone, and back to you, Scott.
Mariette, thank you so much for investing your time in providing the advice and expertise to all of our small business clients out there today and many of our teammates. And Janette, Ivy, Michael, thank you so much for dedicating your time sharing your personal testimonials, your experiences, so many best practices that you've learned along the way, the partners that have influenced your journey and success as well.
I don't know about everyone out there, but I've tremendously learned a lot from each of you. So thank you for taking that time and being here today.
Glad to be here.
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Thank you so much for taking the time to join us today. As I mentioned at the beginning, we want to help business owners at all stages of your journey with the right solutions and advice, so I hope the information we provided today was valuable to you. Thank you all and have a great day.