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Thank You From Protea Financial: This Is Just the Beginning

Thank You From Protea Financial: This Is Just the Beginning

This is truly a surreal moment for us here at Protea Financial as we celebrate our seventh year in business. What started out as a mere extension of a business has since morphed and grown into something much bigger – the dream of better accounting for everyone.

The partners and I here at Protea Financial wish to express our sincere appreciation to all of our team members for their loyal support as we celebrate our seventh year. When our company was founded back in 2014 with just myself and one part-time employee, we could hardly foresee the growth and success we would be fortunate to have over the next seven years. Here in 2021, we now support clients in five states with a team of twenty-three accountants spread across two continents. This simply would not be possible without the loyal support, dedication, and hard work of each and every member of the Protea team.

I would also like to take this time to thank all of our clients, past and present, for taking a risk and signing up to work with us. I am sure at the beginning you must have thought, “Am I really going to work with this unknown company?” and I am profoundly grateful that you chose to take the risk. We have made it our goal here at Protea to provide you with the most efficient, high quality service to help move your business forward. Thank you for believing in us! We look forward to partnering with you well into the future. 

And to all of our supporters, thank you! Your belief in me, my team, and the unique offerings Protea provides has been nothing short of amazing.

It is important to take time to reflect on the past, celebrate the present, and dream of the future. In recognition of this anniversary, I will also be sharing seven of the most important Protea moments of the last seven years over on my LinkedIn page.

Thank you again to every client, supporter, and team member. We wouldn’t be here without you!

Seven years down, many more to come. We have just begun.

Businesses Need to Do These Four Things Before 2021

Businesses Need to Do These Four Things Before 2021

Many of us are looking forward to putting 2020 behind us and welcoming in a new year. The idea of a fresh start is refreshing and business owners are looking to prepare their businesses for 2021 and beyond.

Looking back on 2020 and acknowledging what worked and didn’t work for you and your business is vital to mapping your 2021 approach. While there are numerous areas to think about, including operations, human resources, and sales, these four key steps will help point your business in the right direction.

“Flexibility will be the central theme for 2021. Preparing multiple options may help the process of being prepared for the unexpected.”

Build Your Budget

The start of the new year is a great time to prepare your budget. And entering 2021 marks a critical time to sit down and analyze your future.

The COVID-19 pandemic of 2020 caused many businesses to realize that the traditional static budget of using fixed inputs and outputs was no longer necessarily useful. Creating a fluid and flexible budget that can adapt to changing business realities is now the new reality.

As many small businesses were stretched to the max in 2020, feeling like you were always reacting was the norm. You were stress-tested and learned some valuable information. Use that knowledge and combine it with a proactive approach.

Creating a “perfect” budget for 2021 is probably unrealistic, as things possibly get more difficult before returning to normal, building a better budgeting process is attainable. Businesses should consider preparing a few different budgets that capture best and worst-case scenarios that roll back spending to factor in contingencies for scarce resources or slowed demand. This rolled back spending can create contingency funds that can be used say when demand for your products in certain parts of the country increases or when customer retention rates drop.

Collaborate with your managers to prioritize tasks and projects to justify when and how much to spend. New or special projects that were important at the start of 2020 may be optional for 2021. If you pivoted and launched new products in 2020, access whether you want to include these revenue sources in your 2021 budget.

Flexibility will be the central theme for 2021. Preparing multiple options may help the process of being prepared for the unexpected.

 

Tax Preparation Enablement

We provide your organization a true end to end solution to all of your tax needs. Tax season is year round to Protea – if you aren’t preparing daily, it’s too easy to get behind. We are always working with your organization to streamline your businesses tax management.

Talk to Banks and Shareholders

If you haven’t already been having an ongoing dialogue with your bank, start one in 2021. With 2020’s unprecedented business environment, banks have been working round the clock to help their customers. They’ve likely encountered every possible scenario a business could face. You should rely on their expertise to guide you, but they can only help you if you are honest and prepared

Whether you need a bridge loan to finance operations, need help completing your PPP loan forgiveness application, or need a line of credit in the event you need short-term cash flow in 2021, start the conversation today.

Similarly, start a conversation with your shareholders and partners. Set a realistic tone and expectation for 2021. This will be easier to do once you’ve completed your budgeting scenarios. Let them know the worst and best-case scenarios and explain how you’re prepared to adapt as the uncertainty of 2021 unfolds.

Although the thought of having these difficult conversations with shareholders may be stressful, they will appreciate your honesty and place further trust in you that you’re making the right decisions for business success in 2021.

 

Move Your Back-office Away from Paper

If you weren’t previously optimizing your use of technology, the pandemic quickly forced you to. When administrative offices closed to keep employees safe, working remotely became the new norm and accessing documents remotely became vital.

While having multiple filing cabinets and heaps of paper was sufficient when employees worked in an office, it quickly showed its ineffectiveness when the pandemic struck.

Continue the trend to move your office away from reliance on paper files and documents. With numerous electronic storage options, it’s now cost-effective to move away from paper filing cabinets.

Cloud storage providers ensure your data is secure and easily accessible. And unlike paper filing cabinets, electronic document storage is easily duplicated to create back-up copies.

Having only paper files is risky. With only one copy of documents stored in a cabinet or a box means that if that paper is misplaced or damaged (fires are a real risk these days), you have no back-up copy.

 

Upgrade Your Accounting and Bookkeeping

With 2021 being the year of flexibility, having an agile accounting team will position your winery for continued success.

If 2020 caused you to reduce your bookkeeping and accounting staff, your business might be at a disadvantage now. If you find your books are not up-to-date or you’re not receiving regular financial reports from your accounting department, you may be operating leaner than you should.

With more uncertainty to come, having timely financial information about your business’s health has never been more critical. When you’re going to need to make decisions quickly in 2021, you’ll need current, accurate financial statements.

But if you’re uncertain about bringing on more employees, outsourced bookkeeping and accounting may be what you need.

With outsourced accounting, you can quickly scale your resources to meet your business needs. You’ll not have to wait to find and hire new staff and train them so they’re up to speed. Your outsourced team can add new members immediately who are already experts in the winery and beverage industry. And if business slows down, you can scale down your outsourced team until business picks back up again.

Outsourcing your accounting can provide immediate expert advisors who can provide guidance and financial direction in uncertain times. While you might think that having industry expert accountants on your team may be a luxury your business can’t afford, the numerous flexible fee options at Protea fit any budget. With professionals with decades of experience in the winery and beverage industry, you’ll receive the specialized knowledge you need with the personalized service you deserve.

Reach out to us today to schedule your initial evaluation, and let us help you take some of the uncertainty out of 2021.

 

 

Thank You From Protea Financial: This Is Just the Beginning

This is truly a surreal moment for us here at Protea Financial as we celebrate our seventh year in business. What started out as a mere extension of a business has since morphed and grown into something much bigger - the dream of better accounting for everyone. The...

Protea Conversations: Nastassia Lopez

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Accrual Accounting vs. Cash Accounting – What’s the Difference?

The primary difference between these two is the timing of when transactions get recorded.

Why You Should Hire a Bookkeeper

Running a successful winery requires you to manage numerous departments—production, processing, sales, and administration, to name a few. Often bookkeeping and accounting are some of the first areas neglected when there's not enough of you to go around. When you find...

Small Producers Tax Credits for Everyone!

‘Small Producers Tax Credits for Everyone!’ (Said in my best globally famous talk show host voice.) So you’ve heard that the Craft Beverage Modernization Act was made permanent. And you operate a winery or you support operational reporting for a winery.  Now what?...

Protea Conversations: Suzanne Briel

Protea Financial was founded in 2014 to provide high-quality out-sourced accounting at an affordable price.  Given Protea’s flexible work environment, the Company especially appealed to accountants who wanted to re-enter the workforce after taking time off to start a...

How to Calculate the Cost of Making Wine

To run a profitable winery, it is vital to understand how much profit you are making per bottle of wine sold. You will need to be able to determine and understand what you can sell your wine for and how much that wine costs to produce. While the market will dictate...

Financial Forecasting and Cash Flow Planning

While extremely rewarding, getting a winery up and running can be very difficult to do. Not only does it require a large amount of capital and resources to start with, but you also won’t even start selling wine until a few years down the line. It’s a large investment...

The Property Insurance Marketplace for Wineries

The state of the Property insurance market for wineries is experiencing some severe difficulties and there is no relief in sight for the foreseeable future.  We are experiencing what the insurance industry calls a Hard Insurance Market.  It is hard to get to coverage...

Businesses Need to Do These Four Things Before 2021

Many of us are looking forward to putting 2020 behind us and welcoming in a new year. The idea of a fresh start is refreshing and business owners are looking to prepare their businesses for 2021 and beyond. Looking back on 2020 and acknowledging what worked and didn't...

How to Grow Your Business Through Accounting Outsourcing

Outsourcing routine tasks is an easy way to simplify and grow your business. Accounting, customer service, and marketing are easy places to start when it comes to outsourcing. None of these tasks are unique to your business but all are necessary for a successful...

Bookkeeping Basics for Small Business – Why Bookkeeping Matters

Few of us like to think about bookkeeping and accounting. Without it though, you’ll find yourself in the dark about how your winery is performing. Bookkeeping is the backbone of all businesses. To know what’s happening at the most basic financial level, you’ll need to...

How to Grow Your Business Through Accounting Outsourcing

How to Grow Your Business Through Accounting Outsourcing

Outsourcing routine tasks is an easy way to simplify and grow your business. Accounting, customer service, and marketing are easy places to start when it comes to outsourcing. None of these tasks are unique to your business but all are necessary for a successful business. 

Fewer in-house employees and the legal and financial complexities that come with them mean you’ll be able to quickly adapt when the time comes to grow your business. But is outsourcing your accounting right for you? 

Consider these five advantages when looking to hire an outsourced accounting team.

Save Money and Reinvest to Grow Your Company

Employee hiring can be expensive. Recruitment, pre-screening reports, training, and payroll taxes add up quickly when hiring a full-time accountant. The ongoing salary and taxes will eat into your profits even when your business is in a lull. 

By using an outsourced accounting team, you’ll pay a fraction of the money you’d spend on full-time employees. And that money you’ll save can be used to grow your business. 

Perhaps your winery needs to replace its aging cooperage or purchase a new point of sale system for your retail operations. Reducing your payroll costs can help fund these new investments and grow your business.

As an extra bonus, no more searching for an employee with decades of experience in the beverage industry who knows the industry jargon and nuances. You’ll have a team of winery accounting experts on hand.

Promote or Reinforce Good Business Habits

If you’ve been attempting to do your own bookkeeping and find that it’s not a priority and doesn’t get completed until the bank, the tax preparer, or an investor asks, you’re not setting yourself up for victory. Accounting is the language of business and your business needs to be fluent. 

When you work with an outsourced accounting firm, you’re working with a team of financial experts with years of experience in bookkeeping, financial statement preparation, and internal controls.

An outsourced accounting team can help with calculating winery inventory costs and design internal controls to prevent employee theft. Relying on your team of experts allows you to have up-to-date bookkeeping records so you’ll always know where your business stands. 

These solid habits will pay off when the time comes to expand your business. Outside investors will love seeing that you have complete control over your business and its operations.

 Receive Unbiased Advice From Your Accounting Team

If growing your business means soliciting outside investors or competing in a new market, your outsourced accounting team can provide you with the unbiased advice you deserve. 

Your team of experts can offer tips on how to reduce your cost of goods sold to obtain a higher profit margin to make your winery attractive to investors. Or they can help you evaluate various warehouses to find the best fit for you. 

And if you’re in need of improving cash flow, ask your team how you can reduce your accounts receivable and encourage customers to pay quickly. Offering a discount for prompt payment may cut into your profits but if it decreases your need to rely on expensive short-term loans to meet your cash needs, it may well be what your business needs to hear. 

Outsourced accountants can see your business from the outside, something that may be challenging for the business owner. They can see what’s working and what isn’t. And any fair and trustworthy accountant will give you an honest take on the health of your business. 

Reduce Burdens on You and Your Managers

As a winery owner, you’re pulled in dozens of different directions. Harvesting, production, operations, finance, and customer relations all compete for your attention each day.

You can alleviate stress on you and your management team by letting a team of expert accountants handle the day-to-day finances. Let them get into the trenches so you don’t have to. They will keep your bookkeeping records current so that you’re free to focus on areas that need your personal touch.

Relying on your team’s expertise gives you the confidence you need to make sound business decisions. 

Your expert outsourced accounting team can even help with production reporting and TBB compliance –  freeing up your operations team to focus on quality production.

Grow Your Business Together

When the time comes for your business to expand, your outsourced team will be able to grow with you. You won’t be slowed down searching for and hiring additional full-time employees. Start with a team now that has the ability to meet your needs today and tomorrow.

Rely on a team of experts who can help you answer questions like:

  1. Am I pricing my cases correctly?
  2. Which customers are most profitable?
  3. Can I afford to offer seasonal sales incentives?

And if the time comes when business is slow, your outsourced team can easily be scaled back. You won’t have to continue incurring overhead payroll costs when revenue has dipped. Your outsourced team can fluidly adjust to your business needs.

If you’re considering outsourcing your accounting, do your due diligence to find the right team of experts to complement your business. With the right outsourced team, you’ll be able to tap into the top talent in the accounting industry setting your business up for continued success.

Let Protea be your team for today and tomorrow. Discover why we’re the premier winery and beverage accounting experts on the West Coast by requesting your complete business evaluation today. 

Bookkeeping Basics for Small Business – Why Bookkeeping Matters

Bookkeeping Basics for Small Business – Why Bookkeeping Matters

Few of us like to think about bookkeeping and accounting. Without it though, you’ll find yourself in the dark about how your winery is performing.

Bookkeeping is the backbone of all businesses. To know what’s happening at the most basic financial level, you’ll need to have a great bookkeeping system. 

Today, learn why bookkeeping is essential for a small business and how it prepares your business for continued success.

Understand the Who, What, and Why

Accurate and timely bookkeeping lets you know who owes you money, who you owe money to, and how much you own. 

Accounts Receivable

Your bookkeeping will allow you to know:

1.    Who owes you money,

2.    What they owe you, and 

3.    Why they owe you.

You’ll have receivables if you’re making sales on account. And without good bookkeeping, you won’t know whether you’ve been paid for all of your sales. 

Keeping on top of your receivables will help you maintain your cash flow and avoid charging late fees and chasing collections.

 

Accounts Payable

Tracking the who, what, and why with bookkeeping helps you with payables too. 

You want to know who you owe money to and how much you owe them. Paying your vendors and suppliers on time avoids paying late fees and helps to maintain a strong working relationship. Plus, these vendors could provide trade references when you’re applying for credit with another supplier or a loan from a lender.

 

Equity

Great bookkeeping lets you know how much equity you have in your business.

Your equity is more than just the cash you invest. It’s also the assets, liabilities, and accumulated profits of the business. Equity calculations are important when applying for loans or taking on new investors. If you don’t know how much equity you have in your business, a lender or an investor won’t be comfortable giving you money.

 

Improve budgeting and planning

Proper bookkeeping is essential for budgeting and cash flow management. 

When you keep track of your receivables, you can manage your cash flow better. You want to ensure that money is flowing in on a consistent basis to offset the money that goes out each month. If you let several customers become past due, you’ll need to use other resources, like delaying payments to suppliers or using your own capital, to make up for the cash shortfall. 

Keeping on top of your bookkeeping and cash flow will let you budget effectively. Budgeting is an essential process for anyone in the beverage industry. It allows you to allocate money to processes critical for your business’s success and prioritize spending. 

Without a solid budget, you will feel like you’re just running in a circle, never knowing if you’re meeting your goals. Investing a little bit of your time now to get your bookkeeping in line to prepare your budget will free up your time and energy. 

Elevate analysis and decision making

Great bookkeeping will produce essential reports you’ll need to make decisions for your business.

Although you may be in the winery industry for your love of wine, you’re also in business to make money. You’ll need an income statement, also called a profit and loss statement, to know whether you’re turning a profit. The income statement will show you profit margins and where you’re spending money on overhead expenses.

With a current income statement, you’ll be able to make decisions on whether it’s necessary to cut costs or if you need to grow your sales revenue. 

The income statement receives most of the attention of business owners, but the balance sheet is just as important. Here you’ll be able to see everything you own and owe in one place.

This is where you’ll see if you’ve kept on top of collecting on your receivables and how much inventory you have on hand. The balance sheet is also where you’ll see your equity amount. 

Streamline Tax Planning and Prep

Do you find yourself scrambling each year to get your company’s financial affairs in order for your tax preparer? Although some last-minute calculations for things like depreciation are common, most of your financial information should be up-to-date at year-end. 

Your bookkeeping is essential to preparing your financials for tax time. It will ensure you receive the maximum deductions and credits.

And when your books are organized, you’ll likely receive fewer questions from your tax professional.

Access to accurate financial data will put you on the path to success. And if you need help with your bookkeeping needs, start by asking us how we can help.At Protea, our dedicated and experienced staff are industry experts in the winery industry. Let us help with the day-to-day finances so you can get back to making great wine. Our team works hard to make sure you’re positioned on the right path. Reach out today for an evaluation to learn what Protea can do for your winery.

Why Customer Retention is Imperative For a Winery

Why Customer Retention is Imperative For a Winery

The primary goal of many wineries is to develop, cultivate and produce products that promote repeat business and retain customers. Wineries exist to satisfy customers’ needs through products or services and it’s important for a winery to retain these customers. Since we operate in a competitive business environment, it is important to identify how we can increase customer retention levels.

Let us first define customer retention:

Customer retention is a combination of intentional repurchase behaviour and psychological attachment of a customer to a particular product or service (Al-Hawari 2005:231; Peelen 2005:239; Godson 2009:72; Cant & van Heerden 2010:444). McManus and Guilding (2008:779) also define customer retention as an attitude where a customer’s attachment to a product, service, brand or company is developed. According to Zhang, Dixit and Friedmann (2010:128), customer retention is the likelihood of a customer choosing a particular brand with reference to his/her past purchases.

Why is customer retention important?

Retaining existing customers is cheaper than acquiring new customers.

By retaining customers it allows a winery to generate more profits with each additional year of the customer-relationship. Research has shown that 12 – 15% of customers are loyal to a single retailer, but these customers represent 55 – 70% of total sales, and the only way to increase customer retention is to increase customer satisfaction. Satisfied customers have the tendency to return to the same store and they end up buying the same product.

What happens when customers are dissatisfied? The negative aspect of customer dissatisfaction is that customers lower their expectations when buying from the same winery or stop buying from the winery completely.  Conversely, customers that are satisfied have the tendency to return and possibly refer new customers to your winery. As a result, the winery increases its customer retention and lowers customer acquisition costs, which in turn increases the profit of the business. One of the focal points of a winery should be on customer satisfaction as it can possibly yield greater profitability than customer acquisition strategies.

The question then remains, how to satisfy customers and develop a winning customer retention strategy?

Provide quality products

Quality is more than just producing a quality product. The quality of a product should be customer-driven. What is the customer looking for exactly and how do they define quality? It all comes down to how the customer experiences the product. It is important to note that the higher the quality of the product, the more likely a customer will be satisfied. Quality is also not something that you can improve overnight. Take for example the comparison of wine produced in the early 19th century to today’s wine. The use of modern-day technology, a variety of cultivars, viticulture, and overall winemaking experience allows us to produce outstanding quality wine. It takes time to design and build a quality product from the ground up.

Customer service

Customer service is intricately associated with good quality products. It is important to respond timely to the disgruntled customer and resolve their issue promptly. Customer service is one variable that you can easily control and oversee. Implement standardized service response systems that can deal with inquiries and complaints promptly. These response systems and remedial actions are vital to realize increased levels of customer satisfaction. Your ultimate goal should be to decrease your customer service queries, this in turn evidences that you are producing a quality product. An investment in quality and perfecting your product will reduce your need to deal with customer complaints.

Training and preparation are key

“He who fails to plan is planning to fail!” – Sir Winston Churchill.

It is important to train employees and convey to them that customers are the ultimate judge of quality. Provide employees with a detailed guideline and proper training on how to deal with disgruntled customers. This is especially important as these employees will be representing the brand and they have a big influence on how a customer can perceive the brand. It is important to listen to what the customer is complaining about and utilize this information constructively to improve the overall quality of your product.

Build a relationship of trust with the customer

When a customer trusts the product, the quality, and the brand, they tend to share their experience with family and friends. A case study by Nielsen found that 92 percent of people trust recommendations from friends and family above all other forms of advertising when making a purchase decision. Therefore, nothing comes close to the influence of word of mouth, and satisfied customers share their positive experience with more than five to ten people. Customers need to be able to trust what they buy. By building trust you are providing your customers with something of value which leads to a positive trend towards brand awareness. The winery sales team needs to be thinking about how to deepen the relationship with their customers, especially when they are not in buying mode.

Use automation to your advantage

There is no doubt that technology is there to help us. Try to make use of automated marketing software to engage, re-engage, and keep your customers up to date on what’s happening with your winery and products. Specifically, success stories at wineries have been reported using Customer Relationships Management (CRM) software such as Salesforce, Hubspot, Commerce7, WineDirect, and eCellar. All these CRM systems complement a full marketing methodology for wineries.  Make sure to use standardized email newsletters, event notifications, gated content, promotional emails, abandoned shopping cart reminders, and survey emails. Marketing automation will keep you one step ahead of your competitors by communicating more effectively and efficiently with your customers.

Use social media to your advantage

Social media can power your brand forward but can also be detrimental to your brand. Use social media to research your target audience, analyze your competitors, create engaging content, generate website traffic and grow your audience. Make use of customer reviews online and utilize this space to promptly deal with issues customers may have. By promoting brand awareness online, you create credibility and build trust with customers based on your online activity.

By implementing the above strategies, a winery can increase customer satisfaction, leading to an increase in customer retention. In today’s fast paced competitive market, the wine industry needs to focus their efforts on retaining customers and realise the importance thereof.

References:

Al-Hawari, M. 2005. The effect of automated service quality on bank financial performance and the mediating role of customer retention. Journal of Financial Services Marketing, 10(3):228-243.

Cant, M. & van Heerden, C. 2010. Marketing management. Cape Town: Juta.

Godson, M. 2009. Relationship marketing. New York: Oxford.

Magatef, S. & Tomalieh, E. 2015. The Impact of Customer Loyalty Programs on Customer Retention. International Journal of Business and Social Science, 8(1):81.

McManus, L. & Guilding, C. 2008. Exploring the potential of customer accounting: A synthesis of the accounting and marketing literatures. Journal of Marketing Management, 24(7/8):771-795.

Peelen, E. 2005. Customer relationship management. Essex: Pearson.

Zhang, J.Q., Dixit, A. & Friedmann, R. 2010. Customer loyalty and lifetime value: An empirical investigation of consumer packaged goods. Journal of Marketing Theory & Practice, 18(2):127-139.