Category Archives: Outsourcing

Cash Flow Pressures

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Now might be the time (certainly in Sydney & Melbourne markets) where you might be discovering how strong the foundations of your Real Estate business are? When markets are strong and revenue plentiful, it can hide a multitude of sins. Got a problem, throw more money at it!

However for many, this may be the first time you’ve experienced such challenges in the real estate industry, especially if you’ve been in business less than 10 years, anyone remember the GFC….? Or more recently if you’re on the West Coast, the down turn that came via the mining sector correction, lots of listings no buyers or new managements, but no one to live in them.

It is now that your business requires strong leadership and financial management to push through the other side. First and foremost ask yourself these questions;

  • What is my businesses break-even point?
    • How many sales per month do I need just to keep the lights on?

  • Is my sales team being productive? Being busy and productive are very different, they’re not productive if they’re not listing and SELLING.

  • How does my cash-flow look for the next 6-12 months?

Two of these are financial, the one that is not, can have the biggest impact on the other two! Knowing your break-even is the barometer of your business. If you’re monitoring the productivity of your agents then you’ll know exactly when you’ve passed the “kept the lights on” moment. Your profit and loss report gives you great insights into where your money goes (and if you’re making any) and the trends of your business, a forecast cash-flow shows you where you are going! If you would like a break-even analysis done on your business or a forecast cash flow, then contact us now.

Now is the time for action, keep listing through Christmas up until the office doors close, if you stop so will your sales team! Remember your December BAS will be due for payment in February and March BAS in April, two big cash flow impacts in a short time frame, be prepared.

Outsourcing is a great way to protect cash during lean times, employing staff that are not busy or efficient is a drain on your business. By outsourcing you pay for only what’s required, by someone who specialises in that area. Think about this, if you had to go to court, you wouldn’t go get a law degree or employ a full-time solicitor, you go get a gun for hire to do that job that needs doing! Find out how we can help here.

10 Actions Points for your Business to be the Big Fish in your Real Estate Market?

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Want to be the dominant business in your market and have a profit to show for it? Here’s a word of advice, don’t rely how today’s successful businesses got there, that can’t be replicated ever again, but if you have the ambition to match them, if not topple them, then adopt these action points and if you want it bad enough, there is nothing stopping you. 

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I am currently working on my book, and in preparation for its completion I was asked how I would run an agency if I was to do so. It got me to think about what I have learned from successful businesses I have analysed from the inside out, across all markets.

So here are the actions points you must complete if you are to become the market leading agency no matter where you are.

  1. Work hard! Your best competitors are. If you want to be the best business, you have to beat the best business.
  2. Focus on innovative ways to get an edge, but on the important factors first. Which ones you might ask? no surprise here: “LISTINGS , LISTINGS, LISTINGS” or “PRODUCTIVE AGENTS, PRODUCTIVE AGENTS…..!
  3. You can’t become invincible in your first year, but you can become insolvent. Keep cash flow flowing.
  4. You can always pay your best agents more, if they do more.
  5. If a good business in your market comes up for sale, buy it, but do your homework
  6. Property Management is small in cash flow, but big in value. It’s not a complaint line, it’s a golden egg.
  7. Profit is the goal, not income. Business is about spending a $1.00 to make $1.16, not 85c. Income is great, but margin is what you keep.
  8. Measure everything and review it. Learn from your successes and failures.
  9. Don’t limit your potential, but minimise your risks. Always know when to stop a bad decision and don’t apologise.
  10. Listen to experts, not naysayers. If you have good people, your business will fly and remember to look after them.

If you are thinking about getting into agency business and want to know how it all works, speak to people you either trust or who you know have had success in real estate business. It makes it so much easier when you get things right from the start, rather than the all to familiar “learning the hard way” mentality.

We are always available to help any agent who wants to get their books in order and their business plan finished, just contact us at info@liverealestateaccounts.com.au . The rest is all about hard work and results.

Happy listing and selling,

Chris

7 Traps Of Do-It-Yourself Bookkeeping

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In business, we like to think we can do everything.

But as a business grows, smart business owners soon realise that to manage their time better.  They must outsource non core business functions like bookkeeping.  But many businesses, still try to do everything themselves and so we’ve come up  with 7 traps you must look for for do-it-yourself bookkeeping.

1. Doing it yourself, makes it hard to monitor cash flow.

A business under financial pressure needs to monitor its cash flow carefully.  A dedicated bookkeeper does this by keeping records up to date with regular reporting rather than updating the books at the end of each quarter.

2. Accounting software is not as easy to use as you think.

Whilst some Accounting software is user friendly, there are some traps for businesses that don’t know how to use the software properly.  You need to know what records need to be entered and where to enter them.  Only bookkeepers with experience in using accounting software can provide access to accurate financial records that represent the real picture.  This ensures you won’t have any nasty surprises from the ATO.

3. You must keep on top of your BAS, GST, PAYG and Superannuation obligations.

Every quarter, your business needs to lodge a BAS statement and pay GST, PAYG and Superannuation.  Missing deadlines for any of these can result in penalties. You must have up to date records will give you peace of mind.

By outsourcing your bookkeeping, these deadlines become straight forward as they are managed by someone focussed on keeping your books up-to-date.

4. Don’t lose track of your accounts payable.

Accounts go unpaid for a variety of reasons.  In most cases, it’s because you’ve lost track of what you have and haven’t paid.  A bookkeeper will put the systems in place so you don’t have unpaid accounts hanging over your cash flow and potentially damaging the reputation of your business.

5. Incorrect recording can be a problem.

Incorrect recording occurs when a business owner is unsure where to record the item.  So they just choose from whatever ‘sounds right’ rather than ensuring all items are recorded correctly. Having a bookkeeper experienced in the Real Estate industry means they know which items go where.

6. All bookkeepers are not the same

A good bookkeeper gets things done on time, accurately, which produces clear reporting and accounting benefits to your business. Poor bookkeeping hinders the accuracy of your financial reporting and may result in nasty surprises and headaches for you the business owner.

7. Don’t fall for the “I can do it cheaper” trap

A common mistake by many business owners is not realising the REAL cost of employment.  Employing staff is often more expensive than outsourcing as you must also factor in costs such as: costs to advertise a position, your time to interview candidates, cost of training and then the additional employment costs such as workers comp, payroll tax, sick and holiday leave and superannuation.  With outsourcing you don’t need to worry about these additional costs.

Whilst DIY bookkeeping can seem like the cheapest alternative, you’ll soon realise that you are better off outsourcing this non-core function.  It will give you the time and freedom to do what you do best, grow your real estate business.

Real Estate Bookkeping

7 Benefits of Outsourcing Your Bookkeeping

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Outsourcing key roles in your real estate business is a way to improve profitability and productivity, save time and money! By outsourcing the bookkeeping role with Live Bookkeeping there are many benefits and below I’ve listed 7 for you to think about.

Real Estate Bookkeping

1. On-site – we come to you

Live Bookkeeping will provide an on-site experienced bookkeeper to your business at a time and day the suits you.

2. Peace of mind

There’s no need for you to worry about sick leave, holiday cover etc. If required Live Bookkeeping will provide another bookkeeper, up to speed the next day.

3. Great value for money

Often in small businesses the bookkeeper will either assume or be handed responsibilities outside normal bookkeeping duties, by having a Live Bookkeeping bookkeeper come to you, you know they are there to focus on your books, saving you time and money.

4. Tailored to meet your needs

Once our team has assessed your bookkeeping requirements they’ll be able to guide you on the real time needed to complete the accounts and be able to tailor a bookkeeper to the hours, time and days that suit the business needs. This flexibility allows more hours should the business be experiencing a busy growth period or scale back the hours required should the market taper off.

5. BAS accredited & over seen by a Chartered Accountant

The Tax Agent Services Act 2009 require people who offer BAS services to be registered by the Tax practitioners board, there are fines for unqualified bookkeepers who perform BAS related work.  All of this overseen by our in-house CA.

6. Experienced network of agencies & bookkeepers

Live Bookkeeping provides real estate specific bookkeepers who have the benefit of a wide variety of real estate business experience, from start up, small business, independent to multi franchise offices, gaining valuable knowledge and experience to share with you.

7. Concentrate on your core business while we do the books

By outsourcing this compulsory role in your business and having one less staff member to worry about, you’ll be able to focus your attention on listing and selling and growing your PM, all the while knowing your books and business financial’s are accurate and up to date.
These are just seven compelling reasons to investigate the role outsourcing can play in your business, without going deeper into the “real cost of employment” when you are reviewing roles and staffing requirements of your business

For more information on outsourcing your bookkeeping contact us now.

Happy listing and selling.