Engage employees in the company vision
It is important to share the business vision with employees so that they feel more motivated and enthusiastic. This will not only develop an interest in the work being completed, but also increase productivity. Further, engaged workers are more likely to bring in ideas and contribute to the growth of the company.
Reward Effort
Continually recognising and rewarding effort will encourage employees to continue putting in the effort. It lets employees know that they are appreciated and builds company loyalty.
Being Vulnerable
Upholding a stoic demeanour rather than being vulnerable prevents teams from developing strong professional relationships that are effective. Instead, vulnerability assists in team building and allows employees to feel comfortable with making suggestions that could be extremely promising.
Encourage differing opinions
Businesses should steer clear from creating an atmosphere where people avoid making suggestions because they are in conflict with other ideas. An environment where conflict is welcomed can lead to productive discussions and the generation of good ideas.
Company culture
Determining the core values that your business holds and sharing them with employees can help with creating a strong team. The dynamic between team members is important in ensuring productivity and efficiency. Identifying a company culture will assist the hiring process as well as team dynamics later on.
Posted on 15 October '20, under business. No Comments.
Non-cash fringe benefits provided by employers are subject to FBT, however, if the benefit contributes to the health and safety of the employee, this may exempt it from FBT.
The benefit needs to qualify the following requirements:
- Must be related to the employees health or safety
- Must be aimed at managing risks to health and safety in the workplace as provided under the Health and Safety at Work Act 2015 (HSWA)
- If it was provided on the employer’s premises, it would be excluded under section CX 23.
A benefit that addresses a specific harm or hazard to the health and safety of an employee would meet this criteria. This is because every employer has an obligation under the HSWA to minimise, and where possible, eliminate, risks to employees.
The healthy and safety exemption for benefits is based on the employer’s subjective assessment of potential or actual risks in the workplace. An example of a specific health and safety benefit could be physio appointments that target pain in the area likely to occur due to the employees roles and obligations in the workplace.
Employers should consult a tax professional if there is confusion regarding section CX 24 of the ITA which will exclude benefits from the exemption if benefits are used or consumed on employer premises.
Posted on 15 October '20, under tax. No Comments.
Understanding what organisational structure is can help with making decisions about your business in all areas. Organisational culture is multifaceted, it consists of the shared values, beliefs and norms in the workplace, and determines employee interactions as well as customer interactions.
There are four types of organisational cultures.
- Clan Culture: Focussed on collaboration between teams to form a family-like relationship.
- Adhocracy Culture: Focussed on creativity and innovation and open to continual change.
- Market Culture: Focussed on achieving goals through competitive drive amongst employees.
- Hierarchy Culture: Focussed on formal procedures and guidelines and maintaining power structures.
The organisational culture reflects in all aspects of the business. It can help with determining which potential employees may be more suitable than others and the way that those in leadership positions communicate with employees.
The way a business communicates and interacts with their customers is also influenced by organisational culture. Businesses may desire friendly and informal relationships, or formal and reserved relationships. Communication methods may also change, such as preferring email interaction as opposed to utilising chat functions.
Of course, the culture of an organisation can have overlap of the different types. More important than focussing on one type of culture, is recognising what works best for your business and trying to foster values and norms that embody that.
Posted on 6 October '20, under business. No Comments.
How you spend your money determines how well you can save you money. Spending more than you have or buying unnecessarily can severely impact how efficiently you can save. Sometimes you aren’t even aware of the small habits that are actually limiting your savings capabilities. Here are a few bad money habits that are getting in your way.
Not having a budget:
Spending a substantial amount of money each month on purchases and experiences adds up. Not preparing and sticking to a budget is a common mistake, as many people believe that a budget isn’t necessary for their lifestyle and income. Regardless of how much you earn, individuals need budgets to know where their money goes and what needs to be set aside to achieve their goals.
Eating Out:
Dining in restaurants or grabbing take away most nights in the week is a good way to deplete your finances. Save money by eating out one or two nights and cooking the rest of your meals in bulk at home. Preparation of food will help on those nights when you don’t want to cook and stops you from ordering food.
Impulse Buying:
Purchasing items without a second thought is an easy way to lose money. A good way to avoid this can be to ask yourself if you are buying something because you ‘want’ it, rather than if you ‘need’ it? Learn how to recognise when you do the action and force yourself to wait. You can then consider if you have the extra money to spend on that item, giving you time to properly think about your decision.
Credit Cards:
A credit card is an easy way to spend money you may not have. Living beyond your means is a fast way to fall into debt and is one of the worst things you can do for your finances. Remember, if you don’t pay the card in full each month, every dollar you put on a card will cost you many times more in interest charges. Avoid this problem by thinking of your credit card as an emergency-only option.
Posted on 1 October '20, under money. No Comments.
Set realistic and actionable goals
Businesses should set realistic and actionable small goals which they can work towards, rather broad goals which provide no direction. Setting broad and unrealistic goals is demotivating and makes any progress made seem insignificant. Every person in the business should be given a target to meet over a reasonable timeline which contributes towards achieving a larger goal.
Establishing standardised and automated processes
Small businesses can make the mistake of ‘doing things as they come’ but this means that as business grows, adjusting to high scale tasks is difficult. To avoid this, business should standardise all processes of work. Any individual placed into a role should be able to follow standardised procedure and yield a product which is of similar quality to the previous one. Investing money into automation tools is worthwhile for this procedure. This can include automating management of social media, email, and customer relationships. Both of these will contribute to creating structures which support growth.
Identify competitive strengths and weaknesses
Recognising the strengths and weaknesses of one’s business is essential. Strengths will allow businesses to hone in on unique qualities they possess which give them a competitive advantage. Weaknesses will reveal which areas require growth so that changes can be made before upscaling takes place.
Network
Businesses should continue to develop relationships with service providers, sales channel partners, suppliers and customers. Keeping an open mind about partnerships or potential collaborations could open up different avenues of business growth.
Posted on 1 October '20, under business. No Comments.
An important decision to make before you start a business is what structure your business will run under. This will reflect into all facets of your business, so you should spend time understanding the implications of each structure.
Sole Proprietorship
- You have complete control of your business.
- Your business assets and liabilities are not separate from your personal assets and liabilities.
- Personally liable for debts and obligations of the business
- Low-cost structure
Partnership
- Share control and management of business
- Each partner pays tax on the share of net partnership income each receives
- Minimal reporting requirements + Inexpensive to set up
- Requires more documentation
Company
- Separate legal entity from its owners – all profit, tax, and legal liability is directly to the corporation
- Members not liable for company’s debt (only liable if you breach legal obligations)
- Complex business structure + Extensive documentation and record-keeping
- Wider access to capital
Trust
- Expensive set-up and operation
- Formal trust deed outlining operation required
- Trustee responsible for yearly administrative tasks
Posted on 24 September '20, under business. No Comments.
The New Zealand government is attempting to make changes to reduce the debt that it has incurred in its efforts to stabilize the economy during COVID. The Labour party announced a new top tax rate (39%) which would apply to those earning over $180,000 – this would bring in 550 million dollars each year.
However, critics are unhappy with the government choosing to utilise 2% of the workforce that falls into that bracket. Calculations have shown that this strategy would mean it takes 26 years to pay off the debt that has resulted from wage subsidies provided during COVID.
An alternative provided by critics of this change has been to progressively increase the age at which individuals become eligible to claim superannuation and index super payments to both average wage, and consumer price index growth.
Contrasting the perspective offered by critics, the PM has shown disagreement with raising the retirement age. Unfaltering against the opposing opinions, the government will continue to support the New Zealand Superannuation Fund, with plans to borrow an additional 10.4 billion dollars for it over the next 5 years.
Posted on 24 September '20, under super. No Comments.
Maximising returns on investments is the primary goal for every business owner who invests in a marketing campaign for their brand. Learning how to properly test and troubleshoot your budget according to your business needs can help you save a failing campaign from costing you money.
Objectives
The first step to budget optimisation is being clear with the goals you are trying to achieve through this campaign. These can include generating qualified leads, driving content downloads or building awareness of your brand. Understanding your objectives can help you decide what aspect of your campaign needs more finances.
Testing
Deciding how to set a maximum and minimum spend per day on your campaign can be challenging. A two to four week testing period can help in narrowing down the range that works best to deliver the results set in your objective phase. A common strategy is to start with a mix of ad formats including sponsored content, text and message advertisements. This testing method can help in identifying the types of ads and content that provides optimal results for your brand.
Adapting your budget
Budgeting for marketing campaigns may present a range of issues even after the testing phase. It should be noted that constantly changing and adapting parts of your campaign to run smoothly is a part of digital marketing. It may help to start with a daily budget that is higher at the start of the campaign, and use these insights to then optimise your campaign and lower daily limits if required.
If your campaign is exhausting its budget too quickly, consider lowering your daily limit. If your campaign is not spending its budget, then you may need to automate your bidding option or set more competitive bids. Automated bidding aims to deliver the most results while spending your daily budget in full. This can also help to provide fast results, which can be useful if your marketing content is time-sensitive. However, this will also lead to faster spending of your budget.
Posted on 27 August '20, under business. No Comments.
New Zealand tax residents selling residential property (including overseas property) that they have owned for less than 5 years may be subject to income tax. To determine whether you will have to pay income tax, you will need to use the bright-line rule.
The bright-line rule only applies to property bought on or after 1 October 2015.
The rule considers whether the property was either:
- purchased between 1 October 2015 to 28 March 2018 and sold within 2 years, or
- purchased on or after 29 March 2018 and sold within 5 years.
This means that if the residential property was bought between 1 October 2015 and 28 March 2018 and then sold within 2 years of purchase, income tax was applied to the capital gains made on the resale. Residential property purchased on or after 29 March 2018 will be subject to the five year bright-line rule. In this case, properties that are resold within 5 years of their purchase will be subject to income tax.
Residential property that is sold outside the bright-line period is not subject to the bright-line rule. This means it will not apply if you purchased a property any time on or after 29 March 2018 and sell it after 5 years has already passed.
There are situations where the bright-line rule does not apply even if you sell the property within the bright-line period:
Main home exclusion
The main home exclusion can be used under the bright-line property rule if the following apply:
- The property was used as your main home for over 50% of the time you have owned it.
- More than 50% of the property’s area was used by you. This could include your backyard, garden, and garage.
Individuals can only have one main residence. The main home exclusion can only be used twice over any two-year period.
A main home held in a trust
Residential properties that are held in a trust can also use the main home exclusion if the property sold was the main home of a beneficiary of the trust or the principal settlor of the trust, unless the principal settlor did not have a main home.
Inherited property
Property that is inherited is not subject to the bright-line test when it is sold by the person who inherited the property. If the property, or any part of the property is acquired by someone other than the inheritor, it may be subject to the bright-line rule.
Posted on 27 August '20, under tax. No Comments.
When business is going well, it can be easy to procrastinate planning for the bad times. However, preparing for disaster before it strikes by having a contingency plan can be the key to business survival.
A contingency plan can help businesses prepare for possible circumstances such as natural disasters, employee theft, negative publicity or staff injuries. Having a plan for these contingencies can help your business react faster to unexpected events to prevent ongoing damages, recover from disruptive events, and resume regular business operations as quickly and easily as possible. When writing a contingency plan, consider incorporating the following tactics:
Identify the risks
Think about the key risks that your business could face. This could involve researching your business market, competitors, economy trends, security threats or employment issues. It is a good idea to work with members of different departments in your business in order to foresee potential risks in all sectors.
Prioritise
Once you have identified potential risks, prioritise the ones that are most likely to affect your business. This will ensure that the most relevant issues are addressed first to provide you with a plan if they occur. One way to do this is by creating a risk assessment to identify the most pressing risks.
Create a plan
After identifying the key risks to your business, you can start drafting a contingency plan to mitigate their effects. This should include a clear guideline that outlines what to do when a contingency occurs and how to continue operating the business. The plan should also clarify employee responsibilities, key contact details, timelines of when tasks should be done, restoration processes, and existing resources that can be drawn upon to prevent damage, such as insurance coverage.
Resource assessment
Consider the resources you may need in order to resolve a contingency. This could include extra staff, insurance, PPE, or technical support. In order for the resolution process of a contingency to go smoothly, it is important that you have enough equipment and support so that you don’t have added stress and time going towards finding extra resources.
Share the plan
Once you have written a contingency plan, ensure that they are accessible to your employees and stakeholders. Be receptive to any feedback your employees or stakeholders may have about your plan as there may be room for improvement. It is also important to review your plan over time to ensure that it stays up to date.
Posted on 20 August '20, under business. No Comments.
