Registered office and company records

All New Zealand domiciled companies must have a registered office, as well as an address for service, where legal documents can be delivered to the company.  Both addresses must be notified to the Registrar on application for incorporation.

The registered office must be a physical New Zealand address, not a postal box or accommodation address.  Normally it is the company’s business address or the company’s accountant. 

If a company wants to change its registered office or the address for service, the change and the date upon which it is to take effect must be notified to the Registrar.  This date must be at least five working days after the notice is registered.

At the registered office, a company must keep the following documents:

*  The company’s Constitution 

*  Minutes and resolutions of shareholders’ and directors’ meetings

*  Share register and register of Director’s interests

*  Certificates given by directors

*  Full names and addresses of current directors

*  Copies of written communications to shareholders including annual reports

*  Copies of financial statements and group financial statements

*  Accounting records for the current accounting period and for the previous 7 completed accounting periods

You may keep these records at any other location in New Zealand provided that their location is notified to the Registrar within 10 working days of the change.  The share register, if not separated, is the company’s principal register and must be kept at its registered office.  If separated, the registers may be kept elsewhere.

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Spam to be finally outlawed in New Zealand

With less than a month before The Unsolicited Electronic Messages Act comes into force; are you ready for it?

The Unsolicited Electronic Messages Act 2007 comes into force on September 5 2007 and aims to prevent New Zealand becoming a haven for spammers by prohibiting unsolicited commercial electronic messages. 

The Act requires anyone who sends commercial electronic messages to include accurate sender information and a functional unsubscribe facility.  It applies to all emails, texts and instant messages that market or promotes goods, services, and other schemes of a commercial or dishonest nature.

The Act will initially pose challenges for many small businesses who have been accustomed to sending out SPAM via bulk emailing to solicit new business.  Businesses will have less than six months to get their house (particularly their electronic marketing lists) in order to comply with the Act.

2 practical steps you can take in the lead up to 5 September include the following:

• Ensure that your marketing database lists are “clean” and all recipients on it have provided their “consent” to receiving commercial electronic messages in terms of the Act;
•  Have a process for maintaining and updating electronic marketing lists to comply with the Act (including a process for keeping accurate records of all consents, as well as persons who have used the unsubscribe facility).

A positive consent (or an “opt-in”) to receive future emails is required. Including an unsubscribe message.  The consent requirement applies to anyone sending one-off emails as well as bulk mail-outs. 

Parts of this article have been taken from the Beehive government website.  More details on this subject can be found here:

This is a very topical, and long overdue Act, subject and I encourage you to share your comments as tough penalties will be imposed on future spammers.

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Something to cheer you up

We all know that running your own business is often hard work and we often forget to take time out to celebrate our successes or to inject a bit of humour in our busy lives.  An Aussie friend of mine sent me this link a few days ago, which cheered me up no end! 

Take a quick peak at: 

Cheer me up

You’ll find some of the best on-air blunders and links to videos of them all.   WARNING:  It’s great viewing but some of the language is blue, so it is not for the faint hearted! 

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Proven tips to improve your cash flow

Ever heard of the saying that “a sale is not a sale until the cash is in your bank account?” 

If we you were paid for your sales the moment that you made them, you would never have a cash flow problem. 

Unfortunately, that does not always happen in many businesses.  Credit is a privilege (not a right) and too many customers seek to abuse this trust and often never pay for the service or product you have supplied.  

However, you can still improve your cash flow by managing your receivables. The basic idea is to take on only those customers and clients who will pay you and then convert the time it takes to collect their cash.  

Follow these techniques to improve the look of your bank account! 

Develop good terms and conditions
Having good terms and conditions is not only good business practice for the big corporate companies.  It’s a very good practice for small business owners to ensure that their clients are aware of when (and how) you expect payment.  Make sure you include late payment and interest clauses in them and state that debt collection costs will be passed onto the client.  I have had many clients who think that they can pass on a debt collection agency’s fees only to find out that they have to absorb these costs themselves because they did not make their clients aware of this. 

Carry out credit checks on potential customers or non-cash paying customers
Many small businesses take whatever business they can acquire and carry out credit checks only after problems arise.  Often, it is too late to carry out a check after issues arise.  It’s probably better for your business in the long run to reject a customer immediately if they have poor credit history, are slow payers or are consistently delinquent.  Slow payers are frequently troublesome clients.  They tend to be ones that fall behind paying you, are typically impossible to please, and will find any reason or excuse to pick faults with your business, draining your resources as they do.

Educate your sales team
Do not allow your sales team to sell to businesses or people who persistently pay late. Calculate how much it costs you in interest; telephone calls; letters and accounts staff time when someone persistently pays you late.  If your sales people are good, instruct them to find customers who respect your business enough to pay you on time.  Poor cash flow management is one of the most common reasons why businesses fail (I discuss this in more detail in my eBook “7 common reasons for business failure…and what you can do to avoid it happening to your business”) and quite often it’s because of bad or slow paying customers. 

Invoice promptly
The sooner that you invoice your client, the sooner that the clock starts ticking for them to pay you.  Issue invoices promptly and follow up immediately if payments are slow in coming. Consider sending invoices daily if it warrants doing so.  Find a way to bill everything on the day it happens.  Many businesses take too long to invoice; how much does that cost you in interest costs and efficiency? 

Enforce your terms and conditions
Make sure your terms and conditions specify when (and how) you expect payment.  Consider a late payment clause and interest costs.  Unless you are a bank, why should you finance other people’s businesses?  

Offer incentives to customers who pay promptly
Consider offering your client’s incentives to pay you early.  Chances are that many of your customers will pay promptly if there is an incentive involved.  However, I’m not a big fan of this personally as it amounts to a discount, which many marketing authors discourage.

Track your receivables
I am constantly amazed at the number of my clients who fail to identify slow-paying customers.  Constantly manage your receivables list and ensure that you address slow payers immediately as the longer you allow a client to pay you, the more likelihood they will not pay you.  I’ve seen too many horror stories of where businesses go out of business because of insolvent or bankrupt debtors. 

Develop a workable debt management policy
Consider the strategies that you will use to collect your money.  This may often combine letters and telephone calls to slow payers as well as sending statements.  However, also consider sending invoices and statements electronically (by facsimile or email) as this should reduce the number of clients who tell you “I did not receive your invoice”.

Review your payment options
Do you only accept cheques?  Consider offering a variety of payment options to your clients and make it as easy as possible to pay you.  Put your banking details on your invoices and statements so they can pay you electronically.  Not only is this often quicker for them to pay you but you’ll have cleared funds quicker and will have less administration (and bank fees) to handle the cheque.

Consider the benefits of offering electronic debit/EFTPOS or credit card facilities, as quite often it is a very convenient and fast way for a client to pay you.  If you do receive cheques, consider how often you will go to the bank to pay them in.  Set a limit so staff will know that when a certain value is reached, they MUST go to the bank. 

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Why employing full-time administration staff is costing you more than you think.

The cost of employing full-time administration staff is costing you more than you think.  Added to their salaries, you will have to pay them holiday & sick pay; other government taxes; training costs and they will have regular “down-time”.  And don’t forget the overheads associated with it – a telephone; desk & chair; insurances; software; stationery and many more expenses.  

Consider the following example:  You employ Mary as an Office Administration clerk to prepare your invoices; answer the telephone; type; collect and sort mail and do your banking.  She works (or you pay her for) 37.5 hours per week.  Her salary is $40,000 per year and she is entitled to 20 days annual leave.  She also has 5 days off sick each year (she says she’s “entitled” to them and she’ll use them!) and needs 5 days training at an external training provider.  She’s also  entitled to 11 public holidays per year.  You know that for 25% of her time she is not busy.  On the face of it, you think you are paying her $20.51 per hour. 

However, when you account for her absences and non-productive time, you’re really paying her $32.47 per hour…almost 50% more…and this does not include the overhead costs I mentioned; which may add up to several hundred dollars per year.…

Contrast this to using a virtual assistant (VA).In a conventional office, they are often called “administrative assistants” but to the ‘on-line’ world, they are called “virtual assistants”. They are both the same type of people but with one significant difference: a VA works usually from their own office and uses their own equipment instead of being physically present in your office to carry out the work.  Alternatively, they can come to your office.  As a VA, they are not expensive employees but self-employed professionals.

Generally, a VA will be well educated; hard working; have a proven range of skills; and use a wide range of computer software. This helps them to provide their clients with a tailor made service leaving their clients to focus on other business needs.  Most VA’s will have previously worked as a secretary, personal assistant, clerk, etc and it is likely that they have worked at the highest level in their particular field of work.  They are well trained and keep their skills up to date at their own expense. 

When starting a new business, it is inevitable that small business owners tend to handle all aspects of their business.  At some stage, a business will reach a point where too much time is spent on administration; rather than generating income.  That’s a lot of valuable time spent on an area that may not be your expertise.  By engaging a VA, you free up that time to focus on what you do best!

VAs provide a professional presence in foreign countries for international companies.  If you use a VA abroad, you will have a mailing address and a phone number without the overheads involved in setting up an office.  If you are away (holiday, business trip, etc), it’s possible to have incoming mail forwarded to the VA’s address. 

The case then, is pretty straight forward for many small business owners. 

I outsource ALL of my administration work to Karen and her team at Office Elves (www.theofficeelves.com).  I do not have to employ administration staff; I know that my administration gets done professionally; within budget and on time.  I recommend you consider using a VA; it will save yourself some headaches.         

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Why it pays to have a network of advisors – part 2

In my previous article, I discussed why it’s important to have a good team of professional advisors on hand to help your business.  This article follows on that discussion.

Marketing consultant

Many start-up businesses can’t afford the high fees that these consultants charge, but if you do have the cash, good marketing consultants are well worth it. At the very least, try to buy a few hours of a consultant’s time to discuss crucial sales and marketing questions, and develop a viable marketing strategy. You can gradually build up the relationship over time, as your resources grow.Internet and e-commerce experts can help you to market your company on the Internet, which will extend your reach enormously.

Management consultant or business advisor

These consultants can give you valuable advice on organisational structure, staffing, management styles, risk management, project management and business systems. The need for management consultants becomes greater as the company grows and proper structures are needed.

Information technology expert

A good IT professional can save you substantial amounts of time and money by helping you to set up IT environment appropriately and correctly, ensure that everything runs smoothly, and help you to upgrade and improve your IT infrastructure on an ongoing basis.

Selecting advisors

It’s important to find the right advisors, in terms of expertise, approach and personality. You need to be clear about what you need from an advisor, and feel comfortable with the person and his business philosophy.When it comes to the non-certified professionals, like marketing, management and IT consultants, you need to be cautious, because these groups encompass vast numbers of individuals with radically differing skills and competence levels.

They range from superb to downright dangerous or incompetent.For this type of advisor, word-of-mouth referrals are particularly valuable. You can also get names of advisors from professional and business organisations, and Internet listings.

Ensure, before you interview a prospective advisor that you have a list of questions and that your expectations are clear. When considering an advisor, ask for names of current or previous clients whose needs are similar to your own, and find out whether the advisor provided or exceeded the value they expected.

Professional fees

Ask about fees and fee structures in advance. Where appropriate, ask for formal quotes or contracts. Don’t be afraid to query fees that seem to be excessive or unwarranted.Don’t choose the cheapest advisor. Choose the one who will provide the greatest value to your company.

Mentors, coaches and advisory boards

Older or more experienced colleagues are often more than happy to give advice and guidance to small businesses. While friends can be helpful, strangers are more likely to tell you the things you don’t really want to hear.

It’s very useful to set up an informal board of directors to assist with strategy, planning and problem-solving. Don’t waste their time if you aren’t prepared to take their advice, though! Always ensure that the favour is returned in some way, either through friendship, appropriate tokens of appreciation, or simply by acknowledging their contribution and letting them know how it has helped your business.

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