Monthly Archives: January 2020

Beware of Ransomware!

As we enter 2020 and look back on the past decade, we see how much business and technology have evolved. For example, smartphones went from being a toy that those dang Millennials couldn’t get out of their faces (and the real reason they don’t have jobs, according to everyone’s uncle) to one of the most important fields of computing and marketing. We have also seen the rise and domination of cloud computing and online retailing.

As we progress further into the future, however, old foes that once lurked in the shadows have become dominant forces of disruption. One cyber threat to our modern world that has been around as long as most of us have been online is the common computer virus. And those viruses seem to grow stronger every year. With the start of the new year, let’s go over what we should be concerned with and how to protect yourself and your business.

Enemy at the Gates

Without a doubt, the word that strikes terrors in mortals throughout the business tech world is ransomware. We’ve covered this topic in great detail previously, but due to the ever-present and ever-evolving threat, it’s worth revisiting regularly. In fact, just recently, the entire city of New Orleans declared a state of emergency due to a particularly nasty ransomware attack.

Essentially, ransomware is a combination of a garden variety virus and kidnapper. Once your system is infiltrated, a portion or all of your system is locked out and an automated process or live person sends you a message explaining your situation and their demands. Think of it as less “nice place you have here — shame if something were to happen to it,” and more of an offer you can’t refuse. Once the demands are met, your system and data are supposed to be released back to you.

The FBI officially recommends that you don’t give in to their demands as this will only feed the problem, though they have made it clear that they understand that it is often less expensive to just pay the hackers than have the problem mitigated. Sadly, although these criminals do typically honor their word, there is no guarantee. In addition, there have been stories of companies that went through the effort of getting control of their system back on their own, only to see that some or all of the data had been lost, deleted, or put up for sale on the Dark Web.

Are You Prepared?

In short, if you have to ask this question, the answer is probably no. Simply avoiding strange websites or having an antivirus isn’t enough. We’re not just talking about random guys with a computer on their bed looking for a couple of extra bucks. Due to this being a more publicized, successful and profitable scheme, we’re seeing both an increase in volume as well as sophistication.

These are pirate attacks. When we think of pirates, we may have an image of the Hollywood dirty, toothless, bumbling buccaneers. But the truth is that pirates in all forms have always had to stay one step ahead of countermeasures against them. A solution that worked a decade ago — or even a year ago — might be outdated now, and it could open you and your company up to an attack.

Don’t Let This Slide

Cybersecurity is something that far too many companies put to the side and don’t pay much attention to. The problem with that attitude is that one minute you’re safe and the next minute your company’s data is at the mercy of some shadowy figure from the other side of the world — at least as far as you know. This isn’t an easy fix, like certain health problems that grow over time and can be managed by making simple changes once discovered.

One of the biggest transformations in recent years is how absolutely everything is done digitally. From Grandma’s recipes to Amazon’s shopping cart system, very little if anything is done on paper anymore. Gone are the days of towering filing cabinets, as they have been replaced with towering servers, either onsite or at a hosting location.

Obviously, if you lose access to your data, that will put your company out of commission for at least a few days, but probably much longer. Also, if something goes south with the ransomware attack, losing your data altogether can be a gamechanger — if not a game-ender.

A third problem that could also arise is if the person hacking into your system decides to ransom, sell or out just leak the data itself. Going back to the idea of more and more information being available digitally, think of the damage that can be done to your business if all of your customer’s credit card information was auctioned to the highest bidder. Or, if you’re a medical office, what would the repercussions be if your patients’ information was leaked. These aren’t hypothetical situations — they are reported by the news on a regular basis.

The Situation Isn’t Hopeless

It isn’t all bad news. Thankfully, there are companies that are ready and able to help you combat these threats as they arise. If you don’t have a system in place to protect your company or feel that what you currently have is inadequate, contact us to see what we can do to protect you against the everchanging threats to your cybersecurity.

Remember: the best way to keep hackers out of your system is to make sure they don’t get in there in the first place.

Managing Your Cash Flow

Unless you run a not-for-profit entity, the point of just about every business is to make money. Ironically, for many businesses, especially small businesses, this is the easy part. The hard part is keeping that money. Between paying vendors, purchasing supplies and materials, paying employees, and even yourself, you may find your balance sheet just breaking even. But is this the best way to do business?

Before we get started, just remember that we are not financial or tax experts, so make sure to speak with your accountant or financial department before making any changes. Well, now that we have that out the way…

Balancing the Books

Unless you are a publicly traded corporation, small businesses often like to zero out at the end of the year to avoid undue taxes. Sadly, it seems that some take that to the extreme and seem to keep a low balance in the bank throughout the year. In fact, a study by JPMorgan Chase concluded that the average small business only has enough cash on hand to cover 27 days of expenses. This can be a dangerous game to play if you want to make any major purchases or if your industry fluctuates seasonally.

Just like in personal finance, experts often suggest having enough cash to cover costs for three to six months. While this seems great in theory, that might be a lot of money depending on what sort of business you have. Many industries, such as construction, often have material bills ten times their payroll amounts or more, which would make the six-month plan almost impossible. So, how can you know what’s reasonable for your business?

Let Your Inner Nerd Lead the Way

Notice how we didn’t tell you there wasn’t any math at the beginning of this article. But don’t worry — we’ll make this as painless as possible. Before you can come to a number, think about your goals or previous experience. For example, if you have a seasonal business, how many months of “excess” do you have verse months of “lean”? If you have a stable workload year-round, do you plan on taking on more employees or want to make major capital investments? For the first scenario, merely take your average monthly inflow minus average outflow and multiply that number by the number of months you want to cover:

[Monthly Inflow – Monthly Outflow] x Months to Cover = How much cash you need on hand

It’s as simple as that!

For the second scenario, just adjust by including the estimated amount you will need for the investment divided by how many months you have to save for it included as part of your monthly costs:

[Monthly Inflow – Monthly Outflow + (Total Investment/Months to Save)] x Months to Cover

A little more complicated, but nothing most people couldn’t handle, especially if working with a financial professional. However, to make this easier, you have two options. The obvious option to increase gross income, which is always good. The other option is to lower expenses. What are some easy ways to do that?

Cut Down on Costly Mistakes

In general, the more efficient you are, the lower your costs. But there are hidden costs that many small business owners tend to overlook. We all know that good help is hard to find and not holding on to it can cost you. In order to cut costs, it might seem like a good idea to not pay employees a competitive salary. However, in the long run, this ends up being counterintuitive. How so?

In this job market, the grass sometimes seems greener everywhere else. With the internet, finding those pastures requires very little effort. Having a good employee leave over a few bucks can mean being without their work efforts, and that should generate you much more than what you pay them. Besides, on average, replacing an employee can cost you a third of their salary out of pocket!

Another mistake is not planning ahead when it comes to technology. While many businesses have one or more types of insurance for protection, what arrangements do you have for your computers, servers or other electronics? Think about this: if your system goes down or you need to upgrade, how much are you going to have to spend, both out of pocket plus any downtime this might cause?

Most businesses don’t include this important factor in their budgeting, and, as a result, may get a big hit that will take time to recover from. For this and other reasons, a Managed Service Provider (MSP) is like an insurance policy for your company’s technology needs. An MSP will go over your needs and goals and come up with a monthly plan to make sure that you won’t have any surprises when you have known or unknown technology needs. This gives you the ability to put one more item on your monthly budget and one less thing to keep you up at night.

It’s Totally Worth It

When your business has a reasonable amount of cash on hand, you’ll be able to not only navigate the seas of uncertainty but be able to grow and prosper. With today’s information, take some time to do an honest reflection on where you currently stand and what might be best for your business. To see where we can fit into a plan to increase your liquid cash on hand via an MSP, feel free to contact us directly!

Keeping up with the Competition

You may have noticed in the past ten years or so, we’ve had more variety and better prices than ever before when shopping for — well, just about anything! This has been due in part by a global economy where competition is greater than ever. That’s great news for consumers but presents more pressure on companies to differentiate their goods and services from everyone else.

Regardless of what sort of business you run, there is almost certainly at least one other company that can do what you do just as well if not better. So, what do you need to do to get a leg up on the competition? Well, you can provide a better product or service, of course. But in today’s business climate, you’ll need to go above and beyond that.

Pricing

The days of competing with a store across town are long gone. Unless you are a business that offers a local service that can’t be done somewhere else (e.g., restaurants or barbers), you’re keenly aware that someone from another part of the country — or world — can offer the same thing at a lower price. When a consumer is browsing by price, a difference of just a few cents can cost you the sale.

Thankfully, you can use this system to your advantage. In the past, to see what prices your competitors offered, you had to either hear it from other people or go into their store yourself. Nowadays, you’re just a few clicks away from that information. Not only can this help you in adjusting your prices, but you can even see if the product or service you plan to offer can give you the income you need to be profitable before you even start.

Size

While many businesses can easily start off as a one-man operation or just a small office, being too small can hurt you in the long run. Having too small of an operation might cause you to not be able to handle the amount of clientele you need to stay competitive. Being small may also slow down production due to having too few people responsible for too much work. While running a lean business may seem to be the most cost-effective approach, be realistic about your business goals. Even modest growth in your operation can have astronomic results in overall business if done right.

Employee Relations

There’s a reason why any company of size has a human resources department. If there is trouble amongst your employees, it can eventually affect the bottom line. They say that good help is hard to find, but any business owner or anyone who’s worked in management can tell you that isn’t always true — good help is hard to keep! It’s little wonder that many companies, when measuring success and failure, use a metric known as employee churn rate. This measures the percentage of the company’s workforce that leaves and has to be replaced. The higher this number, the more unhappy the employees in general, and this is often reflected in the profitability of the company as a whole.

If you work in a professional or specialized field, where do you think those ex-employees end up? Often in the arms of your competition or occasionally starting their own company that competes with yours. One of the most notable examples is Dave Thomas, who many forgot worked for Kentucky Fried Chicken (Now just KFC) before using the skills he learned under Colonial Sanders to open his own company, Wendy’s, which is now one of KFC’s biggest competitors. Imagine how things might have turned out if they were able to keep him satisfied?

If your employees aren’t happy with their jobs, how do you think that will affect the quality of their work? How will they treat your customers? As famous businessman Richard Branson once stated: “Clients do not come first. Employees come first. If you take care of your employees, they will take care of your clients.

Stay Out of the Stone Age

For better or worse, customer expectations can often be more important than reality. One of the things many customers expect these days is that if a company isn’t using the latest space-age technology, at least they should attempt to keep up with the times. For example, how would you feel about hiring a company that is still using Windows 98?

In addition to superficial perception, there may be some substance to that argument as well. Many older versions of software lack features that we now take for granted as being standard. What’s more, older versions of software can also be dangerous. How many times have we heard of common software (such as Java) that had a flaw that hackers were able to exploit? Besides, even if the version doesn’t have a defect, older versions of most software can and will eventually have ways to let in cyberthreats to either you or your clientele.

Along with aging software, older hardware can be detrimental to your competitive edge. Out-of-date or inefficient hardware can leave you unable to deliver what your customer’s expect or make the end product a lower quality. While you don’t have to purchase equipment every time a new advancement comes along, keeping an eye on what is generally being used by your competitors will at least keep you even with them.

Consider Outside Help

Technology is a tool for your business, either on the frontend or backend. Make sure your equipment, software, and data management are all up to date and optimal for your needs. If purchasing those items is cost-prohibitive, you might consider utilizing a Hardware as a Service (HaaS) or Software and a Service (SaaS) arrangement to keep up with the competition. If you feel that your company would benefit from this, contact us today to set up a consultation to help you sharpen your competitive edge.

As we head into this new decade, it’s more important than ever to stay competitive. You’ve worked hard to get your company this far. Don’t let it suffer by not keeping up with technology’s ever-changing advancements.