OfficeCentral Online Accounting Solution

OfficeCentral Accounting has been designed to provide you with an easy to use system, but at the same time is able to be used by bigger organizations with multiple branches. Therefore, it is scalable to be used by smaller companies, who will not have to change to another system when they grow bigger.

Some of the modules that are included in OfficeCentral Accounting software is as follow:

Chart of Account 

You will be able to build your chart of account from anywhere you are.

Profit and Loss 

Let the system prepare your profit and loss account automatically so that you won't spend too much time on calculations and also avoid possible loss due to miscalculations.

Balance Sheet

You will also be able to generate your balance sheet easily from the OfficeCentral Online Accounting system and view it anytime you want.

Cash Flow

Let the system provide your cash flow reports automatically anywhere you are, allowing you to have all the information you need at your fingertips.

Account Receivables 

Manage your account receivables easily using the OfficeCentral Online Accounting system. Through the system, you will also be able to track your debtor aging automatically. 

Accounts Payable 

Of course, you can also manage your accounts payable easily using the OfficeCentral Online Accounting system.

Project Accounting

Does your company work per project basis? No sweat. Our OfficeCentral Online Accounting can handle it. Get your project accounting as part of your company accounting.

If you are interested in OfficeCentral online accounting software, feel free to sign up for a free trial now or request a free consultation, where the OfficeCentral team will contact you to setup a free consultation session to see how OfficeCentral Accounting can help your company grow.

Do not expect Distributors to Create Demand for You

You have just created a fantastic product and you are very excited about the growth. You believe the product will explode. So you spend a lot of time talking to distributors so that they can carry your product. They are good distributors. They carry many American products that sell well. They sell in millions. Month after month, no sales for your product. You were wondering, why? Is my product not good? Does nobody want my product?

Many new entrepreneurs make the mistake of misunderstanding the role of distributors. As the name said, they are distributors. They distribute things. When people ask for the specific product, and they have it, they will sell it to them. That’s it. That is their role. While you as a start-up entrepreneur have a different expectation. You expect them to do the marketing for you. You expect them to promote your product. You expect them to learn your product and sell for you. You expect them to spend a lot of their money and resources to sell your product. None of the above happened. There is no shortcut here. When your product is still new, you must do your marketing, you must do your sales. You must do your promotion. Get a lot of users to use your product. Make your own sales. Distributors will only be useful when your product is already well known. When a lot of people wants your product then the role of distributors will come in. Do not make the mistake of expecting them to do the work for you at the beginning. No shortcut here. That is why you must have enough budget for sales and marketing. In the USA normally the budget for marketing is a few times the budget for product development. In Malaysia, chances are the marketing budget is the leftover budget, if that is still available. Do not make this mistake. It will set you back many months or years.

There are many things that you need to watch out. After all that we will still make mistakes. This is the nature of entrepreneurship. We try something new, the new angle of approach, the new model of business, new technology and in some cases new products. It is OK. At least we have avoided the typical mistakes or the mistakes that we could avoid. This will give us the extra breathing time, the short extra time that will help us realize our dream.      

We encourage SMEs to use ICT. They grow, you grow.

You may be able to manage your company well without a system when the company is small. When sales are RM50,000 no problem, at RM100,000 still no problem. The problem starts cropping up when the sales got bigger, and the staff gets larger. At RM200,000, manageable with some headaches. Once it reaches RM300,000 you will understand what I am talking about. Once your sales increased to half a million you will feel the pain, the strain, the headache and sleepless nights. You have more staff now. Many things need to be organized now. Sales, account, payroll, staff, purchasing, invoicing, cash flow, just name it, it will be there for you to handle. Now you will find that you are the reason for your company not growing. You become inefficient, you forget things, you delay things and you become too busy, too stressed, and finally, you will feel burnt out. Don’t do this. We learn earlier that we must have definite chief aim, we must have the plan of execution, now we will learn that we must also have a system, a tool to help us manage our company well. 

ICT is a wonderful creation. The latest technology is cloud technology and mobile technology. At this stage, you are one of the thousands of SMEs now. SMEs used to be behind in ICT adoption as compared to large companies. No system. Less efficient. However, the playing field is more level now with the cloud technology. You now can get access to the sophisticated and powerful solutions that were used to be out of reach. ICT used to be a very expensive capital budget item. With the cloud, it became monthly fees that are much more affordable. Because the cloud is used by thousands of other users, the cost per user became very economical. The cost factor is one of the major benefits of the cloud to SMEs. Of course, the technology and the sophisticated solutions will make the SMEs more efficient, more competitive. The cloud technology allows them to get access to their business operation from anywhere, anytime,  from any device including from their mobile. This is fantastic for entrepreneurs because they are normally out there meeting with prospects and customers all the time.

Actually, for SMEs, there is no investment required as in the typical ‘capital budget’. Just pay a small number of monthly fees to use the cloud solutions. I have met with thousands of SMEs every year and once they understand about the powers and the benefits of cloud solutions, most of them will become cloud user. Just talk to the relevant ICT entrepreneurs about the available system, they will tell you.

All businesses have to face competition including you. It is becoming more intense nowadays. We need to be very efficient, look after our cost, our overhead and have the correct information at our fingertips so that we can make the correct decision, fast. The cloud technology with powerful and comprehensive solutions, access from anywhere, from any device will help tremendously.

You need to use technology especially cloud technology and mobile technology. As a user of the cloud technology you will benefit from the powerful solutions and able to become very efficient and effective in your company operates. You become more competitive, more efficient and your company can continue growing without the headaches that I mentioned earlier. 

At the company level, we actually use a system called OfficeCentral. Actually, we developed it for our own use and then it became our best seller with thousands of users coming online. OfficeCentral provides us and other SMEs a powerful and comprehensive solution to manage the company operating efficiently and effectively. The system provides us with many modules like accounting, accounting, payroll, finance, human resource management, customer relationship management and purchasing and point of sales including mobile applications. 

Many entrepreneurs like this because now they can operate their company from anywhere they are, not limited like before. They can get information, approve things and instruct staff while they are outside the office. They especially like the mobile module where they can operate from their mobile from anywhere. You should use ICT technology especially the cloud and the mobile in order to give yourself and your team the efficiency and speed required to bring your company a level above your competitors.

What is Financial ratios?

You may not be an accountant and do not put too many thoughts on the company financial ratios. You thought that it is your accountant’s job, not your job. Do not do this. Please continue reading and you will understand what I mean.

The old concept Vs new concept

You normally get once a month print out of the Profit and Loss Statement and Balance Sheet from your accountant, and probably some cash flow statement.  You probably are happy with the submitted documents and prepare your monthly report and wait for the next monthly report. You expect your accountant will advise you on other things in your company operates. In most cases, nothing extra comes in.

You may get a monthly report from your salespeople and look at the performance of your sales team. You are happy with it since you have been doing it for years.

You will get upset when the report is not good, not up to expectation or the numbers are down. If you are hot-tempered, your staff will probably sugar-coat the reports so that things will look nice and sweet. 

When you start using the cloud technology, you start to find that the company operation information is available to you anytime you want. In fact, you get your information the instant the event happens. For example, when your staff sends any quotation, you immediately can know the value of quotation, who the customer is, what product and who is the salesperson doing it. Instantly. No need to wait for the monthly report. The same for your Profit and Loss report. You can run the system anytime you want, even when you are away from the office and you will get the report instantly. You are very much more advanced if compared to your competitors using the old concept. You get information instantly and can get data from your historical database online for months and years. You can analyze and try to understand what is going on in your own time. No data is hidden from you. Your challenge now is how to read the mountains of data so that you can make sense out of it and take the necessary action.

We will devote this section to Financial Ratios. They will help you understand your company operation, without the sugar-coated report that you normally got from your staff. As a CEO you must get the correct information so that you can make the correct decision. It is your company. It is your responsibility to make the correct decision.

Financial ratios

We will look at the various financial ratios and explain what it meant to your business. By now you already get the clue that I expect you to be well versed with financial ratios. You cannot leave it to your accountant alone.

I will include the financial ratios for non-listed companies as I assume you are running non-listed companies. Listed entities have a lot more financial ratios that they have to deal with.

You can look at financial ratios to monitor how your company performs, look at the trend or look at comparison against your competitors, see how you fare against them. 

What are the financial ratios?
Profitability Ratios
Liquidity ratios
Activity ratios
Viability Ratios
Investor Ratios

What is MPERS ?

MPERS is the Malaysian Private Entity reporting Standard. It is a subset of the larger International Financial Reporting Standard (IFRS). Every company will provide financial reports like profit and loss, balance sheet, cash flow, and other reports. The question is whether the reports are based on the same things. If every company defines the meaning of the various transactions and reports exactly the same, then the report can be correctly compared. The MPERS made this possible. If one compares the financial report of company A and company B, and both comply to MPERS, the likelihood of us comparing the right numbers is good. It will become a meaningful comparison.

Wrong Pricing Strategy Can Kill You

This is one of the most important strategies that you must understand. If implement a wrong pricing strategy, you will find your business not growing as much as you want to. In fact, you may find that your business may fail. After all the right things that you did, you still face failure because of the wrong pricing model.

Major mistake by entrepreneurs is when they set up their pricing. Normally they calculate their staff cost and then add a certain profit margin and that is their price. This is their major mistake. Everyone in the ecosystem needs money in order to function. One of the most important components is your distributor or agent or master dealers. They need money in order for them to function. They have staff cost, office cost, and other expenses that need to be paid every month. If you imagine that they will help sell your product with very little commission, you are mistaken. If they cannot make enough money to cover their cost and make some profit, they will not help you. Do not ever imagine the dealers will use their own pocket money to help you make a lot of money. The base idea is you must have a strategy where your dealers can have enough money to provide for their lunch and dinners, not only for teh tarik. The price that you set must have their cost in the calculation. It depends on the product price. If the product is said every sale are RM2, 000 and you are giving him 50%, then it is worth awhile for them to sell your product. If your product price is RM300 and you only give him 20% commission (i.e. RM60) then he will not be interested.  Like I said it depends on the product. In this example, the product is an enterprise solution. The selling effort is not like selling a USB stick which requires not extensive product knowledge. In this case, it requires knowledge of the product, explanation to customers and probably some product use training. The dealer needs to invest internally to have someone trained on your product.  They need a good margin to perform this job.

The next item that you need to consider is your advertising and promotion. There must be money allocated for this. Otherwise, you will only spend on A&P whenever you have extra money. In most of the cases, the money will never come. You always have no money for your advertising and promotion. Your branding will be weak. You cannot compete with your competitors that spend more money and effort on their branding. They spend more on their marketing. You spend much less and very sporadic, not consistent. Make sure that your pricing includes this part.

You need to pay your staff well. This will encourage them to stay with you. They can grow with you. Your pricing must ensure that there is enough margin to pay your staff well. Otherwise, you will have a high turnover rate that will negatively impact your company.

By now I can imagine that you will be screaming. You will scream that your price has to go up significantly in order to cater for this. You will be shouting saying this is impossible. You will lose the market share. No problem. This is normal. I did the same thing when faced with the same situation. I only agree to change my pricing after having an extensive discussion with the expert in managing nationwide distribution channel.  I only relent after I look from distributors point of view.  They need to survive. They need consistent income. They need enough money to sustain and grow their operation. When they grow, you also grow. 

I changed my pricing. In fact, I increased my price by 100% in order to cater for this calculation. Surprise. Surprise. My order did not reduce. In fact, the business volume goes up. Many distributors come into the ecosystem. I make more profit. My distributors are happy. My agents are happy. This is the opposite of my initial fear.  

I suggest you look at your pricing and make sure those in your ecosystem can make money when they join you. Not ‘teh tarik’ money, but lunch and dinner money. Their major income comes from selling your product. You will see your business grow when your partners can grow by partnering with you.

If you look at our profit and loss report, you should be able to see how much you spend on your advertising and promotion. Look at the percentage of sales. Look at the trend. Look at the gross margin. Do you have enough margin to do the other things that I mentioned earlier? If not, then your pricing may be a problem.

No Cash Flow Will Kill You

Cash is the water that keeps your company alive. And many of entrepreneur will go hit by cash flow problem and the company died a premature death. A lot of them are new to this game of cash flow. Strictly control your cash flow so that you will live longer. One of the biggest mistakes is not getting paid for work done. This is tough. You paid the salaries, rental, expenses, hardware and delivered the product to your customer, and not getting paid for it. You must control your risk here. Focus on getting paid if you have delivered. If you haven’t started the project, make sure the terms are good for your cash flow.

Watch out for customers that request you to deliver your products without paying first. They sold it and have many excuses when you try to collect. Watch out for a customer that asked you to do a proof of concept without any investment from their side. They have nothing to lose if they abandon the project. For all you know, you are the ones that work your heart out, they do not even care. You are vulnerable at the start of your business, and this is the reason why so many of you fall into this trap. Try not to do it. Be careful so that you will survive this stage. This game is bloody. You are playing with real money. Try to negotiate something such that your cash flow will be good. I have faced this issues a few times in my own business and it cost large cash flow problems and many months of wasted man-hours. The large customers just abandon the project as if it is nothing to them.   

Everybody has a problem even though he or she is from a big company. So if your product really can help them in making their life easier or more bearable, you have an upper hand. You can negotiate so that the term is good for you. If they are totally not interested to negotiate, then you know that they are probably not your customer, not the current team anyway.  Try to make sure you stay alive.

In the accounting module, you can see Cash Flow report in the Accounting Report. It will show you the comparison between inflow and outflows, comparison by months or by year. You would know how you perform in cash flow angle.