Provide quality bookkeeping, tax, and QOE nationwide. Inspired Or Acquired Podcast host. Acquired 3 firms. Fly fisherman and small business geek. NH and COđ
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Updating my bio for new followers - Iâve acquired 3 accounting firms. Appletree provides bookkeeping, tax and consulting to small businesses nationwide. Previous background was sales and advisory. Dad of 3 boys.
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New clients we had in Sept for acquisition due diligence:
- Metal machine shop
- Pool service
- IT services
- Home care
- Warehouse Services / 3PL
- House painting
New accounting and tax clients:
- Wedding venue
- Marketing agency
- Short term rentals
- Author/Speaker
- Property management
- Marketing agency
- Window cleaning
- Cafe
- Real estate brokerage
- HVAC
Solid finish to Q3. Our annual goals are within reach but itâs going to hard to hit them.
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About 10-15% of folks selling their business should just say âyeah I committed tax fraud every year previously, but now that weâre selling the business I did it properly for one year. Hope that explains the numbers.â
And that would in fact explain the numbers.
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The top 5 causes of bookkeeping train wrecks:
1. CRM integration botched
2. Transferring money between companies
3. Personal expenses in the business
4. Too many credit cards and accounts
5. Inventory not tracked properly
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Production pay feels like a magical unlock as a business owner - solves incentives, alignment, results based culture. But I think thereâs some industries where itâs very very hard to track and implement - like residential landscaping
We killed our employee incentive program
Spent over a year trying to make it work. Felt like we had traction sometimes... hard to tell. Ultimately pulled the plug.
The program:
Revenue share over a certain percentage. Every day gets a baseline labor rate. Beat it, and you split the savings with us.
In theory it incentivizes guys to drop below a target labor rate. (guys to get faster underneath it)
Some guys got it. Some didn't.
Here's the thing: we could never explain it cleanly or get them feedback fast enough.
Lessons:
- It has to be simple. Easy to explain, easy to adopt. Too many penalties. Math problem was confusing.
- Feedback has to be FAST. Phone pings the second you make more money, you do that again. Next day is okay. Two weeks later is useless.
- They have to know why. Which actions actually made them money.
We were a few days to a week behind. By the time they saw the number, they couldn't remember what they did to earn it.
So it felt like funny money. "Cool, I made more." Or "cool, I didn't."
My dad has always said he doesn't believe in incentives below the foreman level. I get it now. Not sure I agree.
I still think the ideal is to push it as low in the org as you can, with feedback as fast as you can. We just haven't found the tool yet.
Anybody actually made crew-level incentives work? What did you use?
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Billy Strings concert in BostonâŚ.I hope the ticket prices arenât too high.
The ticket prices:
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"Clear insights, proactive advice and practical solutions." Love seeing reviews like this.
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Once youâre under LOI to buy a business thereâs a sliding scale of due diligence:
Naive Nelly - trusts the seller on everything and doesnât check anything, just wants to close.
Interrogator Ian - turns over every stone, finds new stones to turn over, drives the seller insane, loves spreadsheets.
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The right balance is somewhere in between. Nelly might file for bankruptcy because they overpaid or got fleeced.
Ian might never close because he finds every reason not to a deal, and if he does close the seller hates him and wonât help with a transition after a nightmare diligence period.
I meet more searchers who are the latter and we try to get them to see the big picture but theyâre sometimes impossible to reign in. Try to strike the balance in between.
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When we launched financial planning services alongside our accounting firm, I set a BHAG goal of $100M AUM in 5 years.
We're only 3% of the way there after 5 months but I'm absolutely certain we'll hit the goal. Why? I see the early momentum and have experience with a flywheel in the accounting firm. I'm a more seasoned operator now and know if we just keep plugging away, keep learning and providing good service it'll happen.
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In our monthly staff meeting that lasts 30 minutes weâve been taking 5 minutes to highlight someone whoâs built something with AI or automation. They share how it works, how it helps the client or makes us more efficient.
No BS or AI over hype nonsense. Just real life use cases other staff can copy.
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Facebook seller marketplace economics: you make $1 for every time you have to answer: âis it still available?â
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Weâve done a couple bookkeeping cleanups recently referred to us by business brokers before they tried to sell a business and realized the books were a mess.
The root issue in both deals was owners sending invoices in QuickBooks for projects that wouldnât start for 4-6 months. So revenue is overstated, the balance sheet isnât accurate, and lenders wouldnât give credit for accounts receivable over 90 days old. Plus theyâd send some invoices that never signed - so sales are massively overstated on that piece.
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Went to Garth Brooks concert last night. And then went line dancing and closed down the bar. My Garmin body battery 9/100 today feels about right.
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I presented on two webinars last week. One to a group of franchisees on how to understand their numbers and improve their accounting, the other Doâs and Dontâs for business buyers.
Would you be interested in a webinar on one of the topics below or anything else?
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Tax planning
33%
Due diligence
27%
Accounting KPIs
7%
Webinars are dumb
15 votes ⢠Final results
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âNo need to worry my accountant handles that.â as Biggie would sayâŚ
Sir you took distributions in excess of basis and havenât paid any quarterly estimates. You should be more worried.
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You feel that? Thatâs sales cycles magically speeding up as everyoneâs kids go back to school and people get back to work. Happens every year like clockwork.
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