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Why Business Plans Don’t Cost Extra | Edmonton Accounting Firm


Clients who needed the plan the most. We’re sometimes in the least favorable position to be able to afford the plan.

I can see cause it’s mad. Died.

Hi. Thanks for joining us for another episode of ask [inaudible] CPA. Today we’re talking about in terms of Edmonton accounting firms, why business plans don’t cost extra Harris and associates. So why business plans don’t cost extra, Edmonton Accounting Firm, you know, habits in accounting firms, Brolin associates. Um, the quote that we have here is a Benjamin Franklin quote when way back and says, if you fail to plan, you are planning to fail. If you fail to plan, you are planning to fail. And the statistic you know, that we’re committed to helping is 50% of all Canadian small businesses are out of business in five years. Uh, and some of the ones that are still in business are or aren’t making the type of profits that they should be for the efforts of putting in. And the story that, that we get here at young business owners, they know that a plan is a good idea.

Conceptually. They know that a plan is a good idea. Um, but they don’t get help on it because they don’t know what this thing is going to cost and if they can afford it. Um, that’s a problem. So, Trevor, what are the questions that you think these business owners and that they should be asking? Well, I think the first question will be when we’ll businesses generally benefit from having a business plan. Yeah, there’s a couple of circumstances where business will Jennifer, uh, Edmonton Accounting Firm, you know, benefit from having a business plan. But let’s start with the one who’s not going to benefit. If you’re a status cool company and all you want to do is eke out, you know, three more percent than last year, you’re going to do exactly what you did last year. Just raise your prices incrementally or a couple more hours or something like that. If you’re just looking for a real incremental improvement, things are, you know, clicking along, looking for incremental improvement, you’re probably actually not going to get the most value from business plan.

They’ll be a document that you’ll do and you know, slap in the drawer and you do exactly what he did last year. So that’s not the one, you know, the ones that are really going to benefit from business plan is, you know, they’re struggling in their business there. They’re having some challenges in the business. They don’t know how to alleviate it. Um, businesses that need financing, you know, the bank is a lot more, I’m agreeable to giving you financing. If you have a plan in place, they want to know how this money is going to be deployed. And at some level they’re just going to say, we’re not going to give you any financing if you don’t have a plan. Um, so it’s going to be mandatory, not optional. And the other one is, you know, businesses that are making major changes. And I say major changes.

If you want to grow substantially, that’s a major change. You know, if you’re not talking 3%, and if we’re talking, you know, 10%, 20%, 50% growth, that’s going to be done with a plan that doesn’t happen by accident, that’s an intentional act that’s going to happen. Um, and we want to set that up for, you know, how are we going to do if we, if we did 200,000 last year, well how are we going to do 300 next year? Uh, that’s not something that will happen by accident, that’s going to happen as a result of a plan that’s well executed. So, um, do you charge extra for business plans? Edmonton Accounting Firm, we do not charge extra. That was a, you know, a shift that we made that shift to a couple of years ago. But you know, it’s built into our monthly fee and a flat monthly fee. We don’t charge anymore and we don’t charge any less if we don’t do the plan, the plan is there.

If you need the plan, we’re going to do the plan just because it needs to get done. So is this different from most accounting firms? Yeah, it’s different for most accounting firms. It was different from the way we used to do things that back a couple of years ago. But a couple of years ago we made that switch. And most accounting firms, they’re going to charge you, you know, an extra fee if you want to play it. And it’s like he, every year in do you get another fee? Every return you get another fee. Uh, he’s on a flat monthly fee like us. Is that, that’s we’re kind of the, um, the anomaly in that scenario. Let’s say that maybe we’re not the only one, but Edmonton Accounting Firm, you know, it’s one of very few lists that actually do it that way. Price it that way. Or a business plan. Doesn’t cost extra. Are the extra charges for business plans at other firms set or are they based on time spent?

Yeah, that’s one of the other scary things. This is no, now you need notes or planning and even if you’re willing to spend a couple of extra dollars, you don’t know what a couple of extra dollars means. And maybe a couple of extra dollars means a couple of tens of thousands of extra dollars. Oh Man. Um, you know, you wanted it to plan, but you know, all of a sudden you’re 5,000 or 10,000 or $20,000 to do a plan. Um, so it’s not just, you know, that it’s an extra cost, it’s an uncertain extra costs. Um, you know, based on how much time is going to be involved in the business. Honor, well, I don’t know how much time it’s going to be involved with the accountant. Doesn’t know how much time is it? Well, how am I supposed to know the time that time is involved, you know, they’re paying account and do that. Um, so yeah, it can be a scary situation I think.

Yeah. Getting the mystery bill at the end of the day. Exactly. It’s the sticker shock and you can’t really refute it because you asked for a plan as to point and then you get, you get this gigantic bill. Yeah. Um, so when did you decide to stop charging extra for business plans? It was a couple of years ago. And when we’re, we’re going on a, Oh, it’s two, three years now that we’ve been doing, you know, plans included in the, Edmonton Accounting Firm, in the monthly fees. And it probably a lot of it has to do with it the state of the Alberta economy too, and you know, the economy doesn’t, you know, it started to really tank when oil prices tanked here in Alberta and you know, clients who needed the plan the most, we’re sometimes in the least favorable position to be able to afford the plant, you know, so what do we do?

Do we let those clients go and go looking for new clients that we stick by those clients and actually try to add value and actually try to, you know, Edmonton Accounting Firm, accomplish our vision of helping you know, a thousand businesses for five years or more rather than letting them fall off and just finding people with deeper pockets. Yeah. It’s not the, well who need a doctor. It’s the ones who are sick and in trouble that needed the doctor. So that makes it a lot of sense to me. Yeah. Now how did you use tax planning process? As a model for creating these business plans. So we were, you know, really good in our, in our tax planning process, we had very set processes, templates, systems on how we did our tax plans, which is, well maybe a little opposite of how other people do things and they try to, you know, do them ad hoc.

And we did them, you know, how do we systematize it? How do we find the common missteps that business owners make and how do we address those missteps in the plan? Just like on tax return. What are the common things that people, you know, Miss and how can we set them up? They reduce their taxes, the exact same thing on the business end. You know, what are those misses common mistakes that business owners make and how do we avoid them? And what are those initiatives that business owners don’t really know they don’t know about? What are the things that we can do to grow their business or improve the, you know, reduce the risks in their business. Um, you know, a lot of these things are, there’s a lot of items, but they start to become calm. When you start to look at hundreds of businesses, you know, there’s, um, there’s a, uh, a handful of dozens of strategies that work amongst different industries and you know, that’s how we use it as a, as kind of a template.

We’re renew that if we put systems in place, you know, we can get these things out the door at a higher level more efficiently. Why do you believe that a lot of other professionals are resistant to templates? Yeah, and this goes beyond accounting. This is not just directed as accountants. I know this is accountants. This is lawyers, doctors, engineers, the professionals. And they say, I went to school for so long and I don’t need a template. That’s why I went to school. You can’t template my work. Um, but that’s been proven to be false. Edmonton Accounting Firm, you know, two of them one day and one of my favorite, the checklist manifesto, he, he goes through it and says how they were able to use checklists for emergency room doctors. Um, and these are some of the most educated and highly trained people in the world and the checklist, you know, reduced the number of fatalities in emergency rooms.

And yet we sit there as an accountant or as a lawyer, as an engineer and say, you can’t checklist, well yeah, you can check lists. And I think it’s a level of arrogance, um, that develops because of that education. But you know, it’s that, you know, being humble about that and realizing that there are so many things that we can do to help our clients. It’s impossible to commit all those things to memory and be perfect and the recall that memory each and every day and then try to scale that memory amongst all our employees. It’s absolutely impossible. And when we had a good example where a journeyman electrician and he’s one of our clients and he showed me his checklist for doing a basement renovation, right. And it had like 200 items on it. Then he goes through and he’s like, Josh, I, I’ve been a master electrician for two decades and he’s probably one of the best guys in the city at it.

But he, you know, he, he’s honest enough to admit that if he doesn’t have this checklist, he could very well miss one of those 200 items because the next day in, you know, some commercial outfit, you know, doing a data center. Yeah. I think that we can commit all those things to memory, I think is arrogance and that’s a little dangerous and we can all operate at a higher level. If we were, if we had that humility to admit that the checklist helped us, even if we’re the ones who wrote it, it will still be better with her own checklist. Yeah. Well, when you think of airline pilots, yeah. There’s a checklist for each individual plane that’s out there because if they didn’t have a checklist for each plane, every pilot who went in there would, Edmonton Accounting Firm, would fly the plane differently. And we know what kind of results that we want to avoid and flying aircraft.

So, uh, I mean if it’s good enough for airline pilots as good enough for a small businessman now, how do you believe that a template helps you perform at a higher level? Yeah, I think it just has, you know, the processes that you would otherwise not be able to commit to memory. The things that, yeah, there’s a hundred different, you know, tax buying an issues we can consider here. Did we actually consider each and every one of them, you know, the airline pilots that, that uh, you brought up in a great, because they’re actually the ones, the one profession that these guys are highly trained, but they still go by the checklist. Um, you know the, the guy who flew the plane into the Hudson River in New York, you know the, Edmonton Accounting Firm, what was his name? Uh, oh, I remember, I forget it now, but they made the movie about him and they ask him, you know, how, how’d you do it? You don’t have this plane going down. It was a crash landing and you managed to land it in the middle of the river. And he says, I followed the checklist.

Has been a pilot, a pilot for decades, and then the plane was crash landing and he followed the checklist and we’re saying we can’t, you know, follow a checklist and a non life threatening situation. It’s just, there’s so many variables that we need to consider on each and every item. Let’s build a bigger and better checklist rather than try to commit a few things to memory. Does the template offers certain amount of customization. You’re never going to template everything. You know, a checklist isn’t going to help. A non accountant being accounted a checklist is just going to help an account accountant be a better accountant. This is the same thing. You know, a checklist will help a doctor be a better doctor, but it’s not going to qualify me or you to do that surgery. People seem to think that it replaces that education. It doesn’t replace that education.

It just improves upon that. You know, it’s, it’s, it’s going to, there’s going to be a certain level of customization, you know, professional judgment. Um, you’re just trying to take those standardized decisions out of it. Um, you know, this works almost every time. So let’s do this. Um, and then the things that, you know, we do have to make some professional judgment. Now we have more time freed up. You’ll make now we can spend our time on the things that need to be customized rather than the things that can be systemized. Well, Josh does the business planning process and allow work to be done at a reasonable fee? 100%. Yeah. So once we have those items and we have them systematized, you know, we know what marketing is, should generally work, then we can, you know, in our class, you know, we, we, we, we focus on those foundational marketing initiatives because they work almost every time and then we save our expertise.

Um, do you know what to look at some of the pipeline initiatives, what would be appropriate for that particular client concerning their vision in their industry with their skills that, you know, what’s going to fit right for that? Um, you know, it goes all the way through the business plan. You know, what’s that target market going to look like? You know, what’s their differentiation factors? You know, we’ve a combo of standard differentiation factors, but it’s going to be customized to them. They might have something completely, you know, completely different. You know, what are the risks of the business? We have all of our common risk listed out, but every once in a while they have to have the common lists and, and one of the other risks are completely different than one of the common ones are. Um, but having those systems put in place, it just allows us to plow through all of the things that are very similar, right?

Very quickly. Now the average business owner can actually afford to have a CPA prepare their plan because they’re not reinventing the wheel every time. They’re just applying their professional judgment of the things that are different in their business and they’re using their, their knowledge to give you the data on the things that work and the most efficient manner possible. Um, that’s how we generally tackling. So, so I think that’s what we have here today. Um, why business plans don’t costs extra at spurling associates seven, an accounting firm. Uh, as always, you have any questions, you know, Edmonton Accounting Firm, you know, please leave them in the comments below. We’d love to address them and use your, your feedback for, you know, to develop future content and, and please hit the like and subscribe buttons so we can continue to deliver your tips on how to beat the odds at business. Thanks very much.