Archive for category: News

“There’s life and death in every email.” (Bill Gates)

Over the past 25 years, email has become synonymous with office life: a recent study found that the average worker sends between 9,000 and 15,000 emails a year. All of this is happening despite email being fundamentally flawed in multiple ways that choke businesses and, in some cases, even kill them off. Here are four reasons why email needs to go.

1. It thwarts productivity

   The first thing most employees do in the morning is to check if they have any important emails. Undoubtedly, they do – but these are often buried among a slew of customer queries, spam emails, company newsletters, messages from business partners, employee announcements, HR updates and IT memos. According to one study, wading through these emails to find the vital pieces of information can take employees up to two-and-a-half hours every day.

   The need to constantly check emails can interrupt employee thinking processes and break the vital concentration they need to keep their workflow going. This can slow down projects at every step with the hours adding up dramatically over each project’s lifetime. Worse, the need to be permanently online can mean this is happening with personal emails too.

2. It slows down collaboration

   For one-to-one communication, email retains a powerful role. But in groups, it’s seldom efficient. Email threads where some are always included, and others seldom lead to email dead-ends, lost information and uninformed team members. Even if you are kept in the loop, it can still be confusing. Is the version of the document in your inbox the latest one? Or has it been updated by someone else on another thread?

3. It’s damaging staff mental health

   The two challenges above lead directly to a third, perhaps more dangerous one – an attack on employee mental health. The need to constantly be available, connected and ready-to-reply is exhausting and can lead some employees into anxiety or depression. Humans simply aren’t wired to have their attention constantly divided. No wonder email overload can lead to a notable decrease in our ability to function, with one study suggesting this to be the equivalent of a 10-point drop in IQ.

4. It’s a threat to your safety

   The internet is full of scam artists, criminals and opportunists – all of whom are trying to find a way to steal your data and/or your cash. While antiviruses and firewalls may offer protection from many forms of attack, they can’t protect from everything. According to Seacom, 40% of cyber events that result in loss are Business Email Compromise (BEC) scams. BECs – emails designed to trick staff into giving up vital information or downloading malicious software – result in an estimated R53bn in global company losses each year.

So, what can you do?

• Train your staff
  
  Email isn’t going anywhere. All enterprises, no matter their size, need to find the budget to adequately train their staff in the correct, most efficient way to use emails to reduce the burdens on themselves and their colleagues, while also reducing the threat from BEC scams. As your accountants, we can help you to ensure there’s enough money in your training budget.
• Implement email rules
  
  While some countries (most notably France) have enshrined a “right to disconnect” in their constitutions, this is not the case in South Africa. That’s why it’s important to implement company rules that allow your employees to switch off and be unavailable – not just in the evenings and on weekends, but during the workday too. You can’t expect your employees to get any work done if they feel under constant pressure to check their emails. What’s more, you need to put your money where your mouth is, by sending fewer internal emails.
• Use shared communication spaces
  
  There are loads of new technologies that can help your team communicate better. Shared digital workspaces allow team members to immediately see the latest versions of documents, leave notes for the entire team, and communicate important project information without being afraid that something will get lost in the process. If you aren’t using Google Workspace, Teams, Monday, Slack (Butterfield does have skin in the game), Trello, or similar, you need to speak to your accountant about making this a priority in your budget.

• Leverage automation tools and technology

  The creation of AI has led to new solutions that can help your employees manage their email inboxes. These tools can sift out spam, and sort emails to help staff find the information they need while also deprioritising those emails that don’t need their immediate attention.

The world is getting faster every year, and your business can no longer afford to use email for the wrong reasons. Updating the way you work will have an immediate boost on your company’s well-being and productivity.

“There are no secrets to success. It is the result of preparation, hard work and learning from failure.” (Colin Powell, United States Secretary of State)

Of course you plan for your business to grow. But in an environment of constant change, it can be hard to know where to place your energy. These three focus areas will help you position your business for growth, regardless of the external circumstances.

1. Clean up your finances

   A business that’s ready for growth is one that understands its finances. How much money can you afford to spend on advertising? What investments need to be made to maintain infrastructure or hire the right staff? And can you afford to keep going if there’s a disruption in your supply lines? Businesses with tidy finances are able to answer all of these questions and more.

   If you can’t answer every conceivable question about your finances, then you need to ask your accountant (that’s us) to help you get them in order. Here are a few pointers:

   • Separate business and personal finances

     Business finances that are intermingled with personal ones create confusion and make it difficult to get a clear picture of just where the business is headed.

   • Introduce bookkeeping software

     You may not have the time to stay on top of your finances when you’re running the business – but that’s okay. Using bookkeeping software can keep you one step ahead of the game, and it will definitely save your accountant time.

   • Regularly update your financial statements

     Ask us to keep a set of financial statements up-to-date and on hand at all times. Financial statements can open doors, allowing you to get necessary funding, apply for awards or government incentive programs and/or build an accurate business strategy.

2. Optimise your client base

   Improving company finances doesn’t have to mean introducing new products or expanding into new territories. It’s far simpler to maximise the benefit you’re getting from your current market. Do this by ensuring your sales and marketing teams are functioning at the best possible level, getting the right information to your clients, and then maximising the impact they have on those clients.

   Focus on building genuine relationships with your customers by engaging with them and their needs, providing top-level service and offering value beyond the sale. If you truly care for your customers they will care for you, and you will find yourself at the front of the queue when it comes to new market information and advice on how your product could be improved. Your sales team should also be encouraged to follow up with potential new clients to ensure opportunities aren’t being missed.

3. Analyse your existing offering

   Growth can also be generated by making sure you’re offering the products your clients need at the right price. It’s no good pouring money into a product that’s not right, or which isn’t as good as its competitors. The first step to finding out if you’re on the right track is to ask yourself the question, “If we stopped operating today, would anyone miss us?” If the answer isn’t a resounding yes, then you need to immediately investigate what changes need to be made.

   Do you need to bring on new products to fill the missing gaps in your offering? Is there an essential thing that your product could be doing better? If you aren’t continually striving to deliver the best product in the perfect price range, then you’re probably falling behind.

The bottom line

A company is like the human body. It needs to be perfectly optimised to run at its best level. Making the changes to improve your business health today will pay off in the long run.

“The only real mistake is the one from which we learn nothing.” (Henry Ford)

Without revenue targets, businesses are unable to measure their performance against past years, reward employees, or accurately forecast and plan. Targets set by leaders for individuals or teams can shape morale and expectations for employees and bring accountability to team actions.

But it doesn’t always work like this. You might have found yourself in the unenviable position where your targets are consistently being missed – despite your team leaders reporting that their teams are giving it everything they’ve got. Here are four reasons why this may be happening – and what you can do about it.

Reason 1: You set the wrong goals

For many leaders, revenue targets are calculated by simply adding a percentage to the previous year’s turnover to show growth. While this system may seem sensible, it’s actually very wrong.

When setting revenue targets, you must consider a number of factors that go beyond the achievements of the previous year (or quarter), and the current inflationary environment. Consumer behaviours change; sometimes overnight. The market adjusts and new competitors are always springing up. What’s more, a new technology could arise, bringing new challenges or rendering one of your products or services obsolete.

The first step to setting accurate revenue targets is gathering all the data. Once you’ve done a thorough analysis of the market, competition, and consumer behaviour, you should look at each product or service you offer and evaluate its existing sales and potential for new sales. Setting individual targets should result in much more realistic numbers.

Reason 2: Short-term thinking

Pressure to show growth can cause you to rely too much on channels that deliver speedy growth. It’s easy to fall into the trap of doing things for short-term benefit, rather than building your business one brick at a time. Loads of things that are time-consuming and have no obvious short-term gain could eventually reap huge rewards – things like building an organic online presence or nurturing a business community.

The demand for short-term growth can also lead you to abandon strategies that do work simply because they don’t show immediate success. There’s almost always a lag between implementing a new strategy and seeing an impact on your bottom line – often a little patience is all it takes.

Reason 3: Failing to plan

Having a revenue target is not the same as having a plan. At the end of the day, it’s your staff who will convert the proposed numbers into a reality. Your teams must be given the tools they need to meet your revenue targets.

Have your numbers factored in a new competitor? Then your staff need to know how to market around that new competitor, and your sales teams need to know how to answer the questions they’re going to get about the competitor’s products.

If it’s growth you’re after, will your current team be able to handle the extra hours needed to achieve it? Or do you need to add staff? If you need new staff, have you allocated budget for hiring and training them? And have you considered that they’ll operate at a slower pace in the beginning?

Your accountant (that’s us!) can help you gather the necessary data to turn your sales targets into an actionable, budget-friendly plan that makes them a reality.

Reason 4: Bad sales pipeline

You can only sell to customers who actually need your product. You can kiss your revenue targets goodbye if your sales team isn’t getting enough good leads. Without good leads, salespeople start changing their behaviour, wasting time trying to sell to clients they know won’t bite and/or giving deep discounts just to get a hit.

Poor-quality sales pipelines manifest themselves through deals that either don’t close or that take a long time to close. If this is something you’re seeing regularly, here are three questions to ask yourself:

1. Is your marketing targeting the right demographics?

2. If you are reaching the right demographics, do you have a large enough budget to reach the number of clients you need?
3. Are your leads being assessed for quality, and if so, are the sales reps getting the highest quality leads first?

Remember, revenue targets are most often reached by those companies that have gathered accurate data and planned effectively to reach those goals. Your accountant should be on speed dial when you’re putting together revenue targets (and coming up with plans to make them work).

“The hardest thing in the world to understand is the income tax.” (Albert Einstein)

With an increasing amount of business being conducted online, it’s perfectly possible to live in one country and earn an income in another. If you are conducting services for global corporations and earning foreign income in another country, you could get caught up in a world of tricky tax situations. Under these circumstances, you can find yourself being taxed twice, both in the country where the business is conducted and here at home in Mzansi.

To prevent this scenario and encourage South African residents to bring valuable foreign income into the country, the government has enacted Double Taxation Agreements (DTAs) with 79 foreign powers. If applied correctly at tax time, a DTA should mean you don’t pay tax twice. But how does this work, and just where are the pitfalls?

Check your residency status

Many people incorrectly believe that DTAs mean that income earned in a foreign country is taxable in that country. While the exact terms of each DTA are different, most DTAs actually give taxing rights on employment income to the residential country, unless the services are rendered elsewhere. This means that if you live in South Africa, you should pay all of your taxes in South Africa. On this basis, any taxes also paid to the government of the country in which the income was earned might qualify you for tax relief in South Africa.

Surprisingly though, in some cases, and depending on the domestic legislation in the particular country, an individual may find themselves tax resident in both South African and the other country, regardless of where you live. This can have enormous implications on your legal obligations and the taxes you end up paying. Luckily, all DTAs cater for such instances, with a set of rules to apply to determine which of the two countries you will ultimately be deemed tax resident in.

That’s why it’s vital to ask your accountant to first examine the laws and determine just where you are officially resident and how the specific DTA applies in your case.

Do you need a tie-breaker?

Some South African residents working in foreign countries should normally be given tax residency certificates by the country where they make their income. But don’t fall into the trap of assuming this means you’re not a South African tax resident. More likely you now have dual residency for tax purposes and will be required to apply a tie-breaker test under the specific terms of the relevant DTA to determine just where and how you need to pay taxes.

For something that was supposed to make things simpler and decrease the tax burden on residents earning money overseas, DTAs can actually be somewhat onerous.

Does the DTA even apply?

The fact that there’s a DTA between South Africa and the country of your income may fool you into thinking you’re automatically exempt from paying taxes in one of the two countries, but this is not so. DTA relief is something that must be proven in South Africa before it can be granted. SARS will want proof of your claims – only once they have satisfied themselves that the income is earned offshore will the DTA exemptions apply.

The bad news is that if you do not have the relevant supporting documentation, SARS may choose to view the omission as a material non-disclosure. The good news is that your accountant can help you assess what documentation you need.

• 07 November – Monthly PAYE submissions and payments
• 25 November – Value Added Tax (VAT) manual submissions and payments
• 28 November – Excise duty payments
• 29 November – VAT electronic submissions and payments, Corporate Income Tax Provisional Tax payments where applicable.