So this week’s show we will be talking about Accounting and Bookkeeping with our guest Wayne Richard who is a Biz Dev Networking expert and Bookkeeping expert.
We will discuss a little bit about trying to stay within this whole Cross Border world of accounting which is extremely important and we talked about all different kinds of topics. We also share a little bit some of the experiences.It’s a good episode and I hope it inspires you to take better control of your finances.
Topics Covered in this Episode
About The Guest - Wayne Richard
Biz Dev at Bean Ninjas
Cross border ecommerce, online teams, and families while working remotely at home
Fascination with Online Teams
Experiences working remotely
Dealing with Family and home work
How to balance it
What is cross-border business, the definition
For those not familiar
Banking and classifications
Tips for how to put those banking things in check
Bookkeeping to understand your business, and what channel is best
FBA vs Third Party Fulfillment
What data can we see?
Tools To Help Sellers
What are some popular tools you have seen for virtual businesses
People / Companies / Resources Mentioned in this Episode
Episode Length 56:13
Thank you Wayne so much for sharing your brain, taking that brain, a part of that brain and putting it into the internet as well into our show or podcast. I do appreciate that and I hope others appreciate that definitely bean ninjas is a pretty awesome one.
If you are interested in having some companies do your bookkeeping, keeping your books up-to-date specifically within 0 and others it will be very much appreciated if you check them out.
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[00:00:00] Episode 255 of the Global from Asia podcast talking accounting and e-commerce. Let’s do it. Welcome to the Blobal from Asia podcast with a daunting process of running an international business is broken down into straight-up actionable advice. And now your host Michael Michelini. Thank you everybody for choosing to download and listen or stream Global from Asia episode 255 recording in Shenzhen China my old homebase
[00:00:31] And this intense few days. As I said last week. We are moving gong to Guangzhou for the Cross Border Summit October 22nd– 23rd. I was there for one night and an intense mostly full day. And for those that know the what is it called Greater Bay Area or the PRD Pearl River Delta or South China probably know the whole Hong Kong Guangzhou Dongguan Shenzhen
[00:01:01] Mania of trains and buses and taxis and while it’s intense, it’s a pretty amazing how much you can get around this huge land mass with I don’t even know how many how many people 30 million total some more than 30, you know, each cities like 15 20 million say times three or four, you know, it’s insane well but so it’s pretty amazing we can get around without a car, you know in Chiang Mai.
[00:01:31] It’s my wife that drives. I don’t like to drive but you have got to almost have to have a car there especially the family. But anyway, we’re really excited. We’re basically locked down a venue for the 22nd 23rd of October. We’re going all-in focusing on this as our main events, you know, we did some workshops meet us roundtables some online boot camps and things like that and decided to fully focus our efforts on one
[00:01:53] Great events for the community. So if you do enjoy what you’re listening to and you want to find a way to contribute to the cause, but not just it’s not just a donation. It’s pretty valuable events. So would love to see you there. It’s going to be amazing. I have so many amazing speakers already and I’m a little bit backlog.
[00:02:12] We’ve got totally overwhelmed with people that want to speak and we’re not we’re not ignoring people. We just are trying to figure out a process of vetting all these applications that people that want to share their amazing experiences and knowledge and it’s it’s pretty good people. It’s different Sellers and Traders and service providers and experts within it of course Amazon and Cross Border e-commerce.
[00:02:37] But anyway, I’ll slow down a little bit but. We just it was great to catch up with some people in the community last few days here the home base or my original base for quite a few years. So this week’s show we have talking about accounting and bookkeeping, you know, I know some of you are like cringing actually like me and beanunirpo ninjas has been doing really great.
[00:03:03] Actually. I was there.. will be on their podcast in the near future with Merrill the host and founder there. And today we have Wayne Richard. He’s a. Biz Dev networking expert and bookkeeping expert and we chat a little bit about trying to stay within this whole cross-border world of accounting which is extremely important because you’re dealing with so many currencies so many different banks probably or you know that I think this is honestly really important to to to try to take control of is your accounting because
[00:03:37] A lot if you look at the top line under Amazon or Top Line of their business. But what really matters is the stuff that happens after the Top Line. You know, how much you’re actually spending. Where is it going? And also in the top line, which of those products or which of those services that you sell is working the best and making you the most money so we talked about all different kinds of conversation.
[00:03:59] We also share a little bit some of the experiences. He’s also loves working with online teams you works remotely too so we chat about that as well and it’s a good episode and I hope it inspires you to take better control of your finances and your books because I don’t like it either. You know, I’ll be honest.
[00:04:18] I don’t I am not a books person, but it’s important and I really hope you take that serious and hopefully you learn some things in today’s show and let’s let’s tune. Enjoying the show you want to support our sponsors GoRemit.hk is one of our key sponsors here at the show. They are a cross-border payments solution provider for your Hong Kong bank to paying in Southeast Asia and Mainland China for suppliers virtual assistants paying your rent paying damages for crazy things.
[00:04:50] You might have done and partying. I won’t get into my own story. But you know, we really appreciate them supporting this show. And it keeps the show going and keeps the team going. We actually have quite a bit of people that helped make this podcast. Of course, you hear my voice and our guests, but there’s amazing people, a lot in the Philippines.
[00:05:09] Xiamen China Hong Kong other parts of the world that help make this show happen and we use government to pay them. So if you do want to use solutions for your VA’s or your online team or your suppliers in China, definitely check out www.goremit.HK. Thank you everybody for tuning into this new interview.
[00:05:30] It’s a fun one. You know, I got Wayne Richard from Bean Ninjas. Thanks for coming on Wayne. Absolutely, Mike. Thanks for having me. I’m excited to chat. Yeah, we’ve already been doing a little bit of pre-interview talk. And I feel like we should, I’m like, I hit the record, hit the record, because it’s fascinating already before we even got started.
[00:05:54] I’ve, we’ve known of, you know, of course Bean Ninjas, sure a lot of listeners have heard of your company. And do you want to give, before we jump in, do you want to give a little background about, about yourself and the company? Sure. So, my name is Wayne Richard. I’m the director of global operations and I lead the sales activities at Bean Ninjas. Bean Ninjas is a zero bookkeeping training and Small Business financial education and reporting company.
[00:06:22] We have a global dispersed team and service clients around the globe. Awesome. Yeah, I mean. I was recently on at least re-interviewed on your show, your show, you guys have a podcast as well. And you’re you know, you are, you are practicing what you preach. In a way, you have the online teams, a lot of our listeners or cross-border Sellers and, and doing international business.
[00:06:44] So I’m sure that today’s show, there’s so much we could talk about. I mean, this can be hard to probably keep it in one show. Maybe we can have a follow-up. But, I think you know I was just catching up about our listeners. I think a lot of them are using this keyword crossborder, which means I think we would define crossborders between two countries, right?
[00:07:05] Like usually it’s buying in one country selling in another. Absolutely, and, and I… Yeah, go ahead. I’ve seen a lot of similarities in… I see your audience very focused on building e-commerce businesses. But, as we were talking about earlier, the accounting space is, is in the same trajectory where there’re no longer those boundaries of having to have an office downtown and only having an opportunity to service those clients that could have a physical presence with you in your office.
[00:07:38] Through technology, we now have the opportunity to service clients across the globe. Yeah. It’s an amazing time now. I mean like yeah, we have amazing people on our team here at Global From Asia and our other businesses that work, you know all around the world that… it’s crazy, actually. It’s amazing. It’s, and the cool thing, my favorite part of it actually is… I don’t want to get into a big rant, but.
[00:08:02] That whole entitlement problem of people in certain countries and are born in a certain country, they should be guaranteed some kind of a job or opportunity. That kind of always makes me a little bit… I’m not going to go with specific people. But even in my friend at work, you know, they think like, you know that because they’re in a certain location.
[00:08:18] They should be granted certain benefits, which I don’t believe and I think you know, we should be… be compensated and rewarded based on our ability. Not, not, not our, you know, Birthright? Well, anyway. And you know what’s exciting is that you can now source the, the best talent for the specific job you’re looking to hire. Before, you are limited to those people that were within a reasonable commute into your office space.
[00:08:44] Now, you have an opportunity to put out a very specific job description; have a very clear outline of the roles and responsibilities you’re looking to fill and you have an audience across the globe. So, you can spend time truly getting the best talent, oftentimes when you go cross-border for a rate that’s much less than what you could find for resources within your own city.
[00:09:11] It’s true. It’s amazing. I mean. I’ve been well, I think listeners too have been doing it for a while and you’ve been doing it awhile. I feel like that whole world is flat is coming pretty hyper fast. You know, I’ve seen prices kind of going up and going down. You know, I’m seeing that flattening happening.
[00:09:26] I mean, it’s still a huge opportunity, but the Gap is starting, not to say close, but yeah, I mean, I think… I think it’s, it is starting to really flatten because you know, these good people that might be in quote-unquote cheap places their prices have been going up. I mean, I think you might agree but I mean, it’s pretty amazing to see that even happenning.
[00:09:47] Absolutely, I’ll touch base on, on one of my favorite parts. I think we talked a little earlier about our families and… yeah… For me it’s I don’t spend the end of the day with my globe and I’ll show my kids where I’ve spoken with people throughout the day and had meetings. And, in some days, I may have spoken with people in seven different, seven different countries. Truly on the other side of the world, on the other Hemisphere and.
[00:10:16] Having grown up the way I did in a very blue collar small town in New England. The world is not much larger than New England. And, to think now that I have the ability to have face-to-face, via web conversations, meetings with people clearly on the other side of the world is pretty mind-blowing. It’s, it’s something virtually this exact show.
[00:10:41] Right? Like I’m in Thailand here, you know, there’s Ona now, I think, right and… That’s right. I don’t even know. I don’t ask people anymore like and then listen somebody’s gonna be listening this, you know, who knows somewhere and maybe our listener’s, you know in South Africa or something. For example, I think Phil listens and some others and it’s just mind, mind-blowing.
[00:11:01] And I think it’s scary for the lazy people, right? They are like I don’t want to get in a rant again. But if you’re just going to sit on your laurels and just say I’m just going to like stick with the traditional jobs or opportunities in my region and yeah, I mean you’re going to keep falling behind.
[00:11:17] So I think people got to get off their butt and learn and grow their skills and build a business or make their own opportunity. So let’s, let’s maybe… I kind of want to focus today. There’s so much we could talk about. I’m fascinated by this but I think we want to talk a little bit about what you probably see on a day-to-day basis, is a bookkeeping for cross-border businesses.
[00:11:37] You know Amazon is taking over the world and there’s these sellers making millions, but I think it just gets really complex. I know, in a way maybe, obviously might be hard to do on a generic podcast without you knowing people’s cases. But I think we can talk about some tips and tricks for bookkeeping with somebody – the typical Amazon Seller.
[00:11:55] That’s a business owner that’s buying from a factory in China. Maybe has a Hong Kong company or has maybe a Singapore company or even a US company and then they’re selling in America. There’s obviously people doing Europe. I mean. It’s fascinating to me. And you know, I just think maybe you can give us… we can talk about or I can ask more specific questions, but I think.
[00:12:16] It’s, it’s complex, you know it. And it’s getting more and more common. More and more people are doing it. I mean, I’m, I first, first figuring that out in like 2006 within still my job, day job in New York. But you know how. Do you want me to give you some specific… Maybe we can give an overview of what you’re seeing now and then we can kind of have this conversation.
[00:12:37] I guess I’ll start with a story of, of the most amazing clients that come to us. So I have a unique ability because of my role in sales to hear the startup stories of the customers that Bean Ninjas goes on to support but also as our director of global operations, I have and maintain the client relationship. So across.
[00:13:00] About my three years in supporting Bean Ninjas, I’ve been able to see people that have come to us with an idea that in a in a goal of building a company and in two or three years being in a position to exit that company for life-changing money and in looking at what they’ve done to become successful? I see some key things.
[00:13:26] I think first from day one Build Your Business Financial structure and organize your bookkeeping as if you were positioning to sell. And, what I mean by that is have systems in place, to store and organize source documents, purchase orders, executed invoices. Have a place that you record your income and expenses. Not simply a bank statement where you’re seeing net deposits. But be in a position to understand what your true top-line growth sales are, split from those your relative expenses.
[00:14:06] For instance for Amazon for FBA fees, for storage charges, for ad spent so that you can, one while executing and operating, in your business you can be strategic about where you’re spending money. But also when you are looking to sell your business you will be asked to present Financials. And if you can come to the table with clear financials that have source documents that support areas of spent that show growth very clearly and things like top-line sales, and a strategy where you’ve been effective, in terms of spending within the business and.
[00:14:49] A clear understanding of what expenses could be removed from the, the business when you exit. You position yourself for a higher sales price down the road. Yeah, it’s true. I mean there’s that buzzword. I was waiting for you to say it but working on your business, not in your business. But I think that’s another big goal that we should all have as business owners.
[00:15:12] So much of us love to get into details. I’ve had critical feedback from even podcast guests and friends. That I love getting my hands dirty too personally, but I think we have to realize we have to step back and, and look at it holistically and I guess the best way is these numbers right? That’s, that’s really what, whether you’re selling or your business don’t have business partners, you know, there’s.
[00:15:34] KPIs is a big buzzword or you having metrics that you can then really grow your business. And, think about it strategically as a business owner rather than as a, as a, I guess you can say employee or even employees should have numbers right? But, you know, if you want to really be a business owner, you have to know your numbers I would say.
[00:15:53] It’s what… It goes back. Yeah. It goes back to the adage – You can’t manage what isn’t measured. And, in bookkeeping and in financial reporting you have the ability to look at your financials as both a history lesson. So bookkeeping is basically just the organization of your transactions to help tell you where you’ve spent your money and I like to relate it to you know, personal.
[00:16:23] finance philosophies like Dave Ramsey and like there’s, there’s other for the profit first methodology. And also even with Rich Dad Poor Dad, you know, it’s, it’s not enough just to understand where your money has gone or where your money is coming in from but it’s important to be proactive and look at your numbers and have a future focused to tell your money where you wanted to go.
[00:16:50] So without having metrics or an understanding and narrating that story that’s coming out of those financial reports. You can’t strategically plan for where your business wants to go. You’re almost just operating looking in the rearview mirror rather than a bit looking into the crystal ball if you will but doing so with some very sound items through the metrics that you’ve understood. Yup.
[00:17:21] Great. So, I think I can have some, some questions I can imagine some, some listeners having you know, multi-currency is such a, such a challenge. Is there some tips you can give on cross-border businesses may be buying from a factory. I guess usually that is a little bit easier because the factory usually quote an F.
[00:17:41] OB US dollar. Usually you’re operating in US dollar. But is there any, any strategies or tactics or something we could maybe chat about, or… I can speak more specifically to tools. So I think what’s important is once you have your business organized where you have an ability to operate in multi-currency where you’ve established Banking in multiple countries. Or, you have the sufficient stripe accounts to manage the transactions that need to be managed within your daily operations.
[00:18:12] You need a place where you can record that. So at Bean Ninjas, we are an exclusive provider and utilize only the Xero bookkeeping and accounting Cloud solution and we found that Xero supports multi currency allows for you a place where you can understand the balances and the transactions that are running through your various accounts, but also report those multi-currency accounts and transactions in a way.
[00:18:44] where your reporting is populated in a single currency and it’s typically the currency in the country that you’re operating or your license to your business out of so, it gives you a level platform to understand how one area of spend might be measured against another. Agreed agreed. Yeah, I mean that’s just sometimes you just feel like your heads upside down.
[00:19:08] I mean, I literally I’m literally overwhelmed sometimes with paying peso, baht, RMB, Hong Kong dollar and US Dollars kind of what I’m operating in almost at least monthly. So it’s true. I mean having a a base currency is definitely critical and then. Is that normal? It’s just natural when you start seeing you know Hong Kong dollars is a… your mind automatically thinks it’s a huge number.
[00:19:38] You see all the zeros and you’ve got to process a little bit. Okay that, that FX rate is this in… You have some emotion that originally goes in. So I think when you have an opportunity to put everything into one currency, you have a level framework where you be, can begin to measure and compare areas of spend against one another. Agreed and then there’s you know, what are some other things.
[00:20:08] I’m trying to think of, you know, even even we have a case study for us being a seller. I guess. It’s a bit easier with the US base. Company think is this all settling in dollars? I don’t think there’s multi-currency and banks in America that I know of. Maybe I’m Wrong. I think I think it’s similar in terms of the complexity of managing cross-border companies.
[00:20:33] Headquartered or founded in different countries. We support clients with Hong Kong limited corporations and we support clients across many countries. And, really what it comes down to is having a system in place executing across that system with processes that can be replicated can be given to staff members to manage.
[00:21:00] But also it’s just, cross your t’s and dot your I’s. If you have an opportunity or you’re provided a source document, utilize tools like Hub doc to store those documents and feed them directly into Xero. Those tools even work in multi-currency where you can push documents like invoices that have been paid or receipts that you’ve received and feed them into your accounting solution Xero directly from these other receipt and expense Management Solutions. Makes, makes sense.
[00:21:37] Yeah. I mean like we’ve been you know, talking and speaking of our show today. Yeah leveraging technology or I think that’s one of the beautiful things I mean. It wasn’t even that many years ago. I remember fumbling with QuickBooks installation on my laptop and having like a local data file that I had to like share to an accountant’s like I’m dating myself.
[00:21:59] I remember that was when I was still in New York, and I had to go to accountant’s office in 2006, 2007 and then it was just a huge file. I remember he had to like export for an accountant and send to them and I remember that. I mean nowadays, it’s like you said was Xero or you know, I know you guys are exclusive on that but there’s other options too, but you know some now it’s now there’s ways of sharing pretty easily and it’s it and then like mention Hub Doc and others just by having the data’s in, recorded at least, you know is, is essential. Absolutely. In collaborating.
[00:22:39] We have opportunities now where we can share access to a tax accountant in a given country and still have the opportunity because of the ability and the access through technology. We can support the bookkeeping side and the accounting piece of our customers business, but those areas that become complex or require a significant understanding and discipline within that field such as tax.
[00:23:09] We can collaborate globally with a tax accountant within any given country and share details around what’s occurring within the business. At the end of the day regardless of where a company operates, there’s cash coming into the business that’s through income and there’s money going out of the business that are expenses.
[00:23:33] The complexity comes in your country specific tax rules that we can collaborate. With any tax accountant via web chat as if we were sitting across the table, it’s pretty amazing. It’s true. It’s true. So normally I know you guys have your service which we know which we recommend and we can talk about more maybe some how that works.
[00:23:58] But I mean would you say weekly, monthly? I guess it depends on the volume of the transactions. I mean, is there some, that’s guideline for rec frequency of, maybe bookkeeping or updating your records? Yeah, I think there’s there’s a few best practices. I think you should be in each of your bank accounts reconciling your transactions and what that means is categorizing them against your various income and expense accounts each week.
[00:24:30] You should be reviewing things like payable, so bills that require you to action payment every other week and you should also be managing your personal payroll. I think one topic that would be important for your listeners to understand or strategies around paying yourself. I think often people get into business and they see the vast amounts of softwares and programs that they can link into their website and within their analytics and forget.
[00:25:06] That their business will fail to operate if they are not satisfied and rewarded for their contributions within their business. So it’s important to understand what your value is within your business and begin recognizing that value through payments to yourself. Whether or not through wages or distributions, depending on what your corporate structure allows and there’s a great methodology and I alluded to the book earlier, but Profit First by Mike Michalowicz suggest that you even do that first.
[00:25:43] So you begin taking your cash receipts and allocating a certain percentage of that for owners compensation and a quote that was shared was most people say well that’s not putting the client first. That’s that might be a bit of greed but. The best way to support your clients is to keep your business running and one of the ways to ensure your business runs is to make sure that you’re providing for those living expenses and you’re satisfied by the return that you’re getting for your time and investment into your business.
[00:26:23] Agreed. I mean I am going back to back in the day. But yeah, I remember that kind of flashback memory like day one of making your book, you know, being your business plan is paying yourself, right? And so many of us are you know, to bootstrapping, hustling entrepreneur that, you know, but I think it’s true you’ll respect what you do and respect your business more if you just put that line item for you to be able to be at least comfortable enough to.
[00:26:52] Focus on what you’re working on. And, you’ll also be very strategic on the things you spend money on. I think it’s easy if you see these big lump sum net deposits post in your account and you have a feeling like you have all this money to go out and spend. But, once you start allocating some towards yourself and you begin managing your expenses on what’s left, you begin to thank.
[00:27:17] And I’m a Family Guy and for me, it was easy and starting out in business. It was do I want to spend on a more sophisticated CRM solution, or do I want to put my daughter in dance class? The answer was easy. I said, well, you know, I’m going to put my daughter in her dance class and then I’m going to work my butt off to earn more money and be able to afford that that CRM solution when the money’s there. But I very much look at spend as identifying and making sure you capture certainly those things that you need to have. But the nice-to-have things, make sure that you’re.
[00:28:00] Taking care of yourself before introducing a lot of those. Agreed, agreed. And yeah, there’s no dis. No, you know, I think especially the younger, the younger me was like, you know, I want to dump everything back into this business. I want to grow it. You know, maybe the, I don’t know what Gary Vee would say about this being at the hustle that don’t sleep to make it happen.
[00:28:23] But yeah, I think if you’re not right here, yeah. Yeah, you’re not taking care of yourself and you’re not healthy and you’re not able to you know, feel comfortable. I mean, it’s, it can hurt your business. I think, you know long-term. I think you’ll burn out. I think many of us come to these paths where we have other opportunities.
[00:28:46] We could otherwise earn more money in more traditional settings in the near term in the early months and it does take a bit of grind and it takes some hustle. I’m not saying pay yourself an equivalent salary, but make sure you’re considering yourself in the mix of expenses because what we often see is people build businesses over years and you’ll ask them.
[00:29:13] You know what what they’ve taken out and what they’ve rewarded themselves and it’s often little to nothing or even less than they were making. Yes, there’s something to be said about the intrinsic value of doing something you’re passionate about and growing something from nothing. But also you need to be mindful of setting a line in the sand and saying, it’s okay to recognize myself as.
[00:29:42] An important contributor just as you would when you’re starting to assess in hiring others to come in and support your business. Makes sense. So let’s maybe go to some more of these tips and tricks. So what are you, what are you seeing like, is some common, you mentioned tools or tactics that may be cross-border e-commerce, cross-border business owners are using.
[00:30:06] Sure. So I think the more successful ones what they’re doing is they’re identifying profitability by sales channel. I think that’s critical. I think it’s important as an e-commerce seller to understand what platforms are you doing well in. And, what platforms are you killing it in. It can then allow for you to better adjust your strategy and add spend into those areas that are most successful for you and your business.
[00:30:33] Otherwise, I think other tactics that those successful e-commerce clients are doing is the recognizing and they have an understanding of the difference between inventory and cost of sales. So, often we see clients come to us and they have no inventory recognized in their balance sheet. And there’s a number of ways you can do that and I don’t want to bore everyone with the accounting.
[00:30:58] I feel like at a minimum you should understand the goods that are in transit and you should understand the goods that are in a warehouse ready for sale. And then within that you should also be adjusting your financials to allocate to expense. An equivalent amount of expense to those sales that you’ve generated and there’s a number of technical ways.
[00:31:24] You can work up and understand what that number is, but it’s important that you’re not simply recognizing your expenses based on the bills that you’re paying for these large areas of spend within your business in one month and having your sales come 2, 3 months later and not having any expense recognized against it.
[00:31:48] Makes sense. Something crossed my mind as obviously I’m a, I’m sure most, a lot of your clients are like a hundred percent FBA or maybe I was talking to somebody just the other day. There are people trying to build our Shopify build-out build-out off Amazon, but I’m sure you know these people I talk to are still high heavily on FBA.
[00:32:08] And I wonder if I don’t know if this is something you can reveal or not. But you say profitability. I mean they’re, I’m wondering Amazon is probably a volume and also profitable, but they probably… do you, would you be able to reveal or share or know about, like, would you say what would you say most people are profitable versus… because I think usually people selling their own like say, website shopping cart might be a more profitable, might not be as volume as an FBA.
[00:32:35] Is that something you… Exactly right. That’s exactly right. I mean you’re going to lose 30 plus percent. It’s you know, margin due to various Amazon fees. So I think one other tip I would give is understand how to extract your payment detail report from Seller Central and begin to work either through Excel pivot tables or through tools like a2x to understand the split.
[00:33:09] Of expenses from your true gross sales numbers within Amazon because then you have visibility to your storage fees and your FBA charges and within that you have a true sense of the volume sales, but as you mentioned the expense that goes into operating within Amazon. It’s an amazing platform.
[00:33:31] It’s going to get you exposure that you wouldn’t otherwise have but there’s also cost for that. Absolutely you’re going to make higher margins on selling direct on your website if youre priced competitively. But you’re not going to have as great a reach in selling to those people and having that awareness of brand. Agreed and then I think just to follow up, Wayne.
[00:33:55] I know you’re you’re not you’re not a broker, but I’m sure you probably deal with brokers like obviously we’ve had… there’s a few we know in our Networks. But usually I think buyers are looking for multi-channel, right. And I think a real brand would have, I don’t know. What would you do.. have any insights about that?
[00:34:16] Yeah. I think it’s like anything else. What if one day Amazon decided to private label your product. And they began to pump in ad spend that represented their product well above yours. You don’t want to be held hostage by one sales channel. It’s important to be across multiple sales channels. So that in the event either there was a competitor that started to outsell you or even had a client where there was.
[00:34:52] an individual that was able to access their account that was changing their key Search terms and it dropped their rankings to a place where it nearly sank their, their business and. Because of the processing time that it took to get things fixed it nearly destroyed them. So you want to have opportunities where you’re getting exposure, you’re achieving sales across numerous platforms.
[00:35:20] So in the event that one platform changes their, their algorithms or has you know a limitation on how you’re able to put your products in front of customers you continue to maintain the growth that you’ve had year over year. Agreed, agreed. And, and is there like a percent? I heard a broker saying like, you know at least 30% off Amazon to be considered a true brand, don’t know if that’s something you would agree with.
[00:35:59] No, I don’t. No, I don’t have a type of insight. Yeah, I mean it’s interesting. That’d be an interesting conversation. Yeah, I’m thinking to something on my list and then I guess the next question is so going off Amazon is, is hard though. I mean both on the marketing as well as not just a parking but the Fulfillment I know you could use FBA fulfillment for for non Amazon Channel, but of course, they’re expensive and why would you do that?
[00:36:30] But you know, I think the next challenge of going multi-channel in addition to bookkeeping but I think I want to tie it back to bookkeeping is using a third-party fulfillment center outside of Amazon that gets into even more complexity multiple warehouses. I mean that that topic is massive and a huge headache.
[00:36:48] I don’t know if you want have insights. I mean it for maybe a bookkeeping standpoint maybe of multiple warehouses multiple fulfillment technology channels. I. It relates to bookkeeping and it’s something that I feel people should become aware of because the rules are changing and it’s around sales tax.
[00:37:09] So where you begin to store products in various warehouses and numerous states, you begin to define what’s called Nexus and have Nexus within those States and there was a ruling in South Dakota, and it was the Wayfarer case that began to recognize that if you had goods stored in a certain State and you sold to customers within those States.
[00:37:35] If you achieved a certain volume of sales, then you are required to collect and remit back to the state sales tax. So this was always a very gray area in e-commerce and is becoming more and more clear because more states are beginning to follow suit and where you have Nexus you’re required to file.
[00:37:57] So in some cases you may have a requirement and an administrative burden to begin remitting and filing sales tax return each month or even on a quarterly basis to 17 or 23 different states. So it’s something that plays right into that multi fa-, multi Distribution Center model you were talking about. Agreed, agreed.
[00:38:25] Yeah. I mean just so much really to talk about but there’s a. You know, I mean, I know there’s Xero. I think there’s others too, I mean as far as the technical part, I mean, I think there’s some Sellers and I’ll be honest sometimes even me. I mean, we just kind of do it like a monthly net of our total and we’re not breaking it down always. But the more, the more granular that you can get right like per item.
[00:38:53] you know the profitability of each item and then you know, there’s LIFO and FIFO. I’m honestly one of these bad people in bookkeeping. But you know there’s interests, and there’s the debt. Yeah, there’s first in first out last in lastly first out I mean, but then, you know, of course the inventory tracking is.
[00:39:15] I know sellers want to know exactly which item is the most profitable right and which channel and he can get so you mentioned pivot tables and there’s obviously softwares like Xero and others in the deck can get down to that level. I mean it but then you’re also kind of reliant on your fulfillment centers Data Tracking and things like that.
[00:39:33] And I think what’s important is cover the basics first. I think yes, there is an interest and sellers want that level of detail. But you can’t get there, if you don’t first understand how much money are you making in your business in a given year. How much of that money you’re making in your business is coming through as we mentioned earlier each of your sales channels, which of you know, how much of your money are you spending as a percentage of sales on.
[00:40:05] Things that will drive growth in your business like ad spend. You know, I think it’s important to understand those things like profitability by skew but only after you’ve had a clear understanding of the big picture and I think what we’re finding is people failed that step first. So we try to take a step back and say, okay, let’s get you organized.
[00:40:33] and achieve Step 1 before we look to get to step 27. Agreed. All right. Well, it’s been a great talk. I know we’re both dads and there’s kids around and is there any last points, I mean, of course, we’ll talk about your service too but is it, before we get into maybe talk about how you guys work? Is there, is there any other last, last points you’d want to bring up?
[00:40:58] I think that was kind of like seems like a really good one. You just said but give you the chance to add something. Well, I think I’ve covered most of the bookkeeping strategy, systems, process conversations. I am most excited to be a dad and I think we talked earlier, but we hadn’t started yet. I’m the father of five.
[00:41:21] Wow. So my wife and I had two children and we were then surprised with triplets. So I now have five year old triplets and the opportunities that have been made available to me in being more entrepreneurial and working with global distributed business and with a team that’s dispersed across, believe now, eight different countries has given me the flexibility to really be involved and intentional in the time that I spend with each of my kids.
[00:41:58] I’m that Dad at the field trips. I’m that Dad at each and every dance recital t-ball practice and school play that’s out there. The reason I can do that is because of the flexibility that I now have in being a partner in an online business. It’s awesome. Yeah, I mean, it’s really amazing for us. You know me.
[00:42:23] I move recently bout a year. Little bit less than a year ago was recording but from China to Thailand and yeah, I mean basically it’s amazing, amazing world and an amazing opportunity and to be… yeah, being a parent as well as still being a business owner and and running it mostly from anywhere. So I think a lot of our listeners in that position some are, maybe not yet, or working towards that but, but it’s an amazing time and I hope more, I hope everybody gets that opportunity.
[00:42:49] So thank you so much Wayne for sharing about Bean Ninjas, and I think a lot of listeners are familiar with. Guys been around while and doing well, but you want to share a little bit about how you guys work or how people can find you? Sure, so Bean Ninjas. We deliver Xero bookkeeping services. Small business bookkeeping coaching and training we could be found at beanninjas.com.
[00:43:18] We have a course. We recently rolled out specific to e-commerce Sellers and also a second course that we design specific to bookkeeping systems and processes for virtual assistants as we identified in our build out of our initial course that a lot of business owners were asking if we could train their virtual assistants to support a lot of their bookkeeping activities.
[00:43:46] So we identified a course and designed one specific to the virtual assistant audience. Perfect. Yeah, that sounds great. And yeah, well, we’ll link up your site and course people can, can find you online anyway. Thank you, again. Enjoy your Friday evening. It’s my Saturday morning. We’re true hustler’s, you know and dads, but I think this is a great show and thank you for sharing.
[00:44:10] Awesome. Mike was a pleasure to be on. Thanks for having me. Do you want first access to our Cross-border Summit? Do you want to engage and get on monthly calls with other amazing people in the community? Then definitely check out GFAVIP.com. This is a private community and benefits and discounts for those that are very much wanting to support and get involved with the community here at Global from Asia.
[00:44:36] It’s a way to help the show continue and we really appreciate all of those people that have been applying. It is application only. We want this to be about quality and important people in the cross-border business and e-commerce Community. If you are interested to get involved with us connect with me and other amazing people on monthly calls, private groups.
[00:44:57] And of course getting first dibs to the cross-border summit as well as discounts. Definitely check it out www.gfavip.com. All right. Thank you Wayne so much for sharing your brain. Taking that brain out part of that brain and putting it into the internet, well, radio show or a podcast I do appreciate that and I hope others appreciate that definitely Bean Ninjas is a pretty awesome one.
[00:45:23] We cooperate with them at Unipro Consulting Limited, our partner company for a company registration in Hong Kong. So if you are interested in having some companies do your bookkeeping, keeping your books up-to-date specifically within Xero and others it will be very much appreciated if you check them out.
[00:45:45] No affiliate links. No, no really incentive to do that. But you know many others, I’ve watched him grow and develop over the years. So they are an amazing company that really helps their clients and especially e-commerce internet businesses to keep their books in order. So, of course as in anything, you can do anything yourself.
[00:46:03] You can register companies yourself. You can do your bookkeeping, yourself. You could do your sourcing, yourself; your quality control, yourself. You could do your payments. I guess you could do your payments yourself. You could stuff up suitcases of cash and fly to that place and give them a suitcase of cash.
[00:46:18] But as you hear in the show, we have different service providers and experts and Consultants that can help business owners and Traders do their business better and Bean Ninjas is one of them. Thanks again for them contributing to the community. I’ll do my blah blah blah a little bit. I’m kind of on a road into doing this on a dining room table.
[00:46:40] So I will maybe not do 10 minutes, but. Bookkeeping is extremely important. I remember when I first started to do mine for my first e-commerce business. Mmm think I didn’t really do much more than Excel for 2004. Which is mostly negatives because you start businesses, your sales are probably zero for a while and it’s mostly costs. But you still should track that so we were tracking that, Andrew, my partner and that first business and me, in that studio apartment in Manhattan, New York City.
[00:47:15] 24th Street and Third Avenue was Excel spreadsheet and we had one computer that we shared when we started with my laptop. You didn’t have a laptop and we would just take turns using the computer and what we did as an Excel spreadsheet. So that is obviously a critical first step. Of course, you don’t get to spend money on Xero or QuickBooks but a little bit for my blah blah blah here in my use of bookkeeping we then switch to Quickbooks.
[00:47:45] And that was before it was QuickBooks online. That was when it was this software yet. We spent like two hundred dollars or something and it was like CDs you had to install the software on your laptop or your computer and we had no idea how to use this stuff. It was like overheating my, I don’t know what laptop I had Lenovo or IBM Thinkpad or some kind of crappy laptop that would reset.
[00:48:11] If you unplugged it because the battery was burned out on it. And so I found a QuickBooks consultant in Manhattan. And I forget her name. She’s a nice nice woman and she thought we were totally insane because like sometime in 2005 and we were like can you help us we installed this software and I didn’t know how to do chart of accounts and figure out what expense classifications for this or that and.
[00:48:37] You know, I like to keep things funny. But you know, like one of the cool things about selling bar supplies online is those bar receipts are legitimate business expenses you had like tons of receipts of you know, this bar that bar and we’re like. What do we classify those in and QuickBooks T&E travel and entertainment?
[00:49:00] I guess that’s a business expense and you know anything can be a business, you know, you can really put anything as you know in your books, of course people ask me. You know, about this trade war. Can I say it’s made in Hong Kong and send my Chinese goods from Hong Kong. You could do anything, you know, yeah, I could forge documents and lie and say my factory’s in Hong Kong and not mainland China.
[00:49:25] You could also take a business expense from a nightclub in Manhattan and say it’s a business development expense but it if it you know, anything can be done. It’s just if anybody asks, you know, and unfortunately if you’re too small, it’s not worth the. The big dogs to bother you, but you know, I’m trying to make this ending segment a little bit fun, but she thought we were insane with our huge envelope of receipts of night clubs that had probably beer stains on it and other things but we were trying to figure out how to put this into this amazing new software that was overheating my.
[00:50:08] I don’t know if 1999 laptop from college and try to figure out how to enter transactions into it and what to put what but you know, I think the good thing about using a software instead of an Excel spreadsheet is it does make reports easier? Of course, you could do reports in Excel with like macros or all this other crazy stuff, but I think once you get to that point and what you get the data into a Xero or a QuickBooks.
[00:50:36] You can then actually try to run reports and then you can actually look at how many night clubs have you gone for business purposes in the last month, or you can see, you know, travel cost how much you’re spending on marketing how much how much money you’re given Jeff Bezos and Amazon for your PPC ads compared to your product sales.
[00:50:58] And what is your real margins and even some advanced stuff like if you can get the data? You can see what’s your most profitable products. You know, what’s your most popular product. That might be a little bit tricky in even these accounting systems because you’d have to pull in all your products into it.
[00:51:14] But all I’m trying to say is you know start with Excel. I don’t want to, you know, always just had a workshop and there are some new, new entrepreneurs starting and I remember, you know, don’t get so complex at the beginning. But, at least have the habit of trying to keep track of all those expenses and all those negative losses as you try to, to hustle and grind and build your first business or your current business, your new business.
[00:51:41] But if you’re already doing it, you know, sometimes you’re like I didn’t do accounting for the last three years or I just gave bank statements to my accountant and hope I did it all right, but, you know. I’ll be honest. I’ve been there with certain things I’ve done. Maybe you don’t want to backdate last three years, because maybe don’t want to pay a ton of money to a worker or a company like being inches to go back in time.
[00:52:04] Maybe pick a date or maybe pick a year. Maybe say January first. I’m going to go back to January 1st, or maybe it’s maybe, it’s in December and you’re like, what’s my New Year’s resolution. Maybe just start from the year going forward to have better accounting better bookkeeping better better tracking.
[00:52:19] And and one thing I like to say is, maybe, you know one good thing about having partners is accountability. Maybe your partner’s your investors or your team have like a weekly report that you actually look at. Don’t just put the numbers into a data system. Actually try to look at the numbers and think like what is working.
[00:52:36] What’s not working? You know, what is, what is getting the biggest ROI. Is it by PPC on Amazon, Donating to Amazon cause and on Amazon Foundation. Or, it’s, its you know, the Google ads or Facebook ads or is it like trade shows, or is it maybe that cross-border Summit ticket I bought, you know, and I invested in cross-border Summit.
[00:52:56] Maybe that was the best investment for my business that year. I made some business connections. I made some deals. I met some amazing people. I supported podcast. Stuff like that. You know, you got to look at all those costs, all those sales. What did get you the best ROI for your business? What was working and what wasn’t working.
[00:53:13] and adjust you know maybe weekly, at least I would say monthly and also quarterly I do for the Sisitano stuff. I make a quarterly report and you don’t have to get so crazy, right? What’s your Top Line? What’s your expense? Total expenses. What’s some one-time cost that maybe I wouldn’t be on recurring costs that.
[00:53:34] Hit the company or maybe positively impacted a company but you shouldn’t look at it as a regular thing and then try to you know, make that a simple report send it out to your team. Send it out to different people. I think your job as the founder or the owner or the executive or the active person working in a company is to know your numbers. To know what’s working.
[00:53:52] No, it’s not be able to actually present that clearly too. Others in the company whether its employees or whether its Partners or investors, you know, I think you got to know your numbers know what’s working, know what’s not. So, as much as you might be like me, and be the artist and the Creator, and not into the numbers, it’s your job.
[00:54:12] If you want to really be a business owner is to run your numbers know your numbers and be able to present those numbers to others that need to see it. Especially we’ve had other people, business brokers on the podcast and I think Wayne even mentioned in the show. If you ever want to sell your company or if you’re going to get investors you have to be able to show numbers.
[00:54:31] They’re going to ask what’s your numbers? So and I know I know I know how it goes. You know, I know how it goes. Sometimes, I think it’s out of control and get behind. But I think for at least if you want to sell your company or maybe raise money or something, at least you need a year, at least I think about pretty more like two years of pretty pretty clear financials for them to look at before they probably even consider investing or buying or partnering with you.
[00:54:56] So, you know hustle if you’re starting. Try to keep at least a spreadsheet. When you get a little bit of money and it gets a little more complicated, invest in some kind of software like QuickBooks and Xero and there’s some others, Go Daddy. We’ve had people on the show say I actually have that for the Sisitano company, but any kind of software and then if you got money.
[00:55:20] pay somebody. Pay Bean Ninjas. Pay, pay, pay me some freelancer or hire somebody in your company or do it yourself. Probably doing yourself is the best because you actually see the transactions and you’re thinking about them as your data entering that into your software or there’s obviously Auto Imports, but if you just Auto Import, you still got to look at the numbers.
[00:55:38] I think looking at the numbers looking at the report and thinking about it is the most valuable part. I hope this is helpful. I hope you enjoyed the interview with Wayne. Thanks, Wayne for coming on and a blah blah blah segment at the end is over and this show 255 Global From Asia is over. Thank you for listening.
[00:55:55] Bye. Get more info about running an international business, please visit our website at www.globalfromasia.com that’s www.globalfromasia.com. Also be sure to subscribe to our iTunes feed. Thanks for tuning in.