I read an interesting post by Jean-Pierre Ruiz that I want to share with you. Did you know that 33 percent of new small businesses fail within the first two years? Knowing the 10 common problems small business owners face can increase your odds for success.

1. Not Enough Cash. Most businesses fail because they lack enough cash at first and, as a result, take on excessive debt.  Before you set off on your adventure, make sure that you have sufficient cash to operate for the next 12 months, using your worst case scenario. Then, pay careful and daily attention to your finances; carefully record cash inflow and outflow.  Make sure you are familiar with accounting principles.  No need to become a CPA or even take an accounting class.  Widely available and very affordable software packages, such as Quicken, make it easy to be your own bookkeeper.  Of course, if you can afford it, the services of an accountant who has extensive small business expertise is the still best solution.

Read the entire article here.

What do customer service and accounting have to do with each other? As a business owner, your customer’s needs should come first in every aspect of your business – including your accounting procedures. So give your accounting procedures an audit and find out what your customers would like to see improved. Is there something in the way you prepare invoices for your customers or apply payments from your customers that can be improved? Is everyone in your accounting department also trained in how to handle customers and complaints they may have in the billing process?

As a side note, since my business is focusing less on accounting and more on helping service businesses with their self-promotion, Thursday’s blog will now be more about customer service. Watch for tidbits on accounting here and there though.

Basic bookkeeping involves three main tasks:

1. Posting all financial transactions to the proper accounts.

2. Keeping financial records (invoices, sales receipts, and bank statements) in order.

3. Completing the accounting cycle on a regular basis, usually monthly. Often a bookkeeper prepares accounts to be adjusted and closed by an accountant.

Much more information can be found about basic bookkeeping at Learn Basic Accounting.

Accounting terms are often confusing and overwhelming to small business operators. Today’s term is ‘purchase order’. The website AccountingCoach.com defines this term as below:

Purchase Order

Also known as a “p.o.” This is a multi-copy form prepared by the company that is ordering goods. The form will specify the items being ordered, the quantity, price, and terms. One copy is sent to the vendor (supplier) of the goods, one copy is sent to the accounts payable department to be later compared to the receiving ticket and invoice from the vendor.

I’ve added several categories to my blog including Marketing, Accounting, Small Business, and Resources. Beginning next week on Monday, July 21, 2008, my blog will follow this format:

Monday: Each Monday I will post a blog entry about marketing.

Tuesday: The blog entry on Tuesdays will be for the Small Business category.

Wednesday: Watch for a variety of resources to be posted each Wednesday. These may be links to websites full of resources, books I’ve found interesting, book reviews, interviews with small business people, and once in a while a Q & A section. I’d be interested in knowing what resources you’d like to see in this section.

Thursday: On Thursday the post will be something to do with accounting.

Friday: My free-for-all day! Who knows what you may find on Fridays.

Now what am I going to write about Monday that has to do with marketing? Hmm….