Common misconceptions in your design business
Dr. Ralf Speth, CEO of Jaguar Land Rover, once said:
“If you think good design is expensive, you should look at the cost of bad design.”
I’m sure you’ve seen first-hand how bad design can ruin a room. Whether it’s lighting that kills the mood, an atrociously painted accent wall or another faux pas… you notice it.
The same belief – that bad design is incredibly costly – also applies to business. The way you structure your business, build your network and create process and systems to move you forward all have an impact on your longevity and success.
Today I want to tackle some common misconceptions that threaten to slaughter your profits – and show you how to avoid them.
1) Any accountant with a CPA license is good enough for your business.
When I talk to potential clients, they always have a funny story about how they started working with their accountant. The problem is, there are different types of accountants and not all of them will suit your business.
When you’re selecting a biz accountant, consider:
Your business goals: Do you have a specific goal you’re trying to achieve? For instance, do you want to grow your team, expand your offerings or reach $1M within the next 10 years? If so, choose an accountant with a proven track record of helping clients attain the goals you want to reach.
Your specific needs: Are you looking for an accountant to handle your monthly bookkeeping and year-end tax needs? Would you like your accountant to work as a part-time CFO, helping you reach your short- and long-term financial goals? Make sure you know what your accountant does and doesn’t do prior to working with them.
The level of expertise: An accountant with design industry expertise has the capability to help you navigate challenges specific to your industry, such as sales tax. This knowledge has the potential to greatly impact your bottom line.
2) You feel you need to do everything yourself.
If there’s one thing we can never make more of, it’s time. When you try to handle every aspect of your business, you’re bound to feel like you’re drowning. In addition to being stressed, dealing with the burden of everything your business needs to function takes a monumental amount of time. Wouldn’t your time be better spent focusing on other profit-boosting activities?
Client Joanna McNulty of JMID says:
In the beginning, I was responsible for all the things small business owners deal with on a day-to-day basis. I spent more time paying bills, entering transactions in QuickBooks, and filing sales tax reports than I did actually working on design projects. Now that I work with an accountant who understands my business, I save nearly 20 hours per month. I use this time to create beautiful designs for clients, which has given me more referrals and grown my business.
Ask yourself, “What could I accomplish with 20 extra hours per month?”
3) Having to fit your uniquely shaped business into a drab, square box… a.k.a, letting your accountant dictate your financial software
Here’s a mistake that even seasoned designers make: allowing their accountant to dictate what financial software is used to manage their expenses. Even if you use cloud-based accounting software to manage your business financials, your accountant insists you use Quickbooks Desktop to do your year-end tax management.
This process is not only inefficient, it can add hours to your month and waste precious time that you could be spending on more profitable (and enjoyable!) activities.
If you find that your accountant wants to box you in to a specific software, it’s time to find a new one. The best way is to ask trusted friends in your industry who they use and if they’re satisfied. Remember to ask pointed questions such as: “Has your accountant worked in cloud-based accounting software?” and “Do they have extensive experience working with designers?” The answers you receive will help you decide if it’s worth your time to schedule a consult.
If you’ve fallen victim to these trends, know that it’s not your fault. You can change the course of your business, regain control and start a new path toward financial freedom.