Customer Stories: Randal DeHart, PMP
ProAdvisor Helps Contractors Build Their Businesses—Uses QuickBooks Merchant Service to Get Paid Fast
Although Randal DeHart of Shoreline, Washington helps his clients set up their QuickBooks software and run their companies more efficiently, he doesn't have "CPA" on his business cards. He uses "PMP"—Project Management Professional.
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I recommend QuickBooks Merchant Service to every client, every day. I call it 'the electronic armored car.' It [Merchant Service] takes the money from your client in the form of a credit card payment to your bank, just like an armored car.
Randal serves a niche market of small homebuilders, upper—end remodelers, and speculative and custom builders in and around Seattle. They use project management methods to control their developments; he uses those same techniques along with QuickBooks software to help them build their businesses. Being highly methodical helps him create the blueprints necessary for his clients' success.
"One of the areas we work on first," Randal says, "is, what are their goals? What are they looking to accomplish? Then, we look at how their finance and accounting system interplays with their goals. Once the accounting system is squared away—and QuickBooks is all I use—then I move forward and develop simplified methods for their accounting input by condensing their chart of accounts, their items list and so on. The whole idea is for my clients to become process dependent rather than people dependent."
So what does that mean?
"What that means," Randal continues, "is that accounting is several distinct steps, the first three of which are data entry. I create my own operation manual for a particular client, so that client can hire someone with limited skills to do the basic data entry, the billing, deposits, etc. Then, I work with the owners to help them read and understand financial statements." Randal likes to employ what's known as "the five at five for five" technique—five key reports that an owner looks at for five minutes at 5 o'clock in the evening. These include the cash report, A/R report, A/P report, P&L, and balance sheet—all that's needed to run a business successfully, Randal says. "I'm making the client dependent on a process rather than on a person who might answer the phones, run errands, make coffee and also handle the accounting as a side function. Depending on the size of your company, by the time I leave, you might have one if not two people doing strictly the accounting, and profits increase substantially, because they're watching the numbers. Once I'm finished," Randal explains, "the owner is no longer necessary to run the daily operations. All the processes, the management methods if you will, are in place."
An important process that Randal has put into place in his own practice recently is how he bills his clients. In the past, he would send out monthly statements and hope that his clients had been busy enough that they could pay him promptly. However, the construction business being what it is, erratic cash flow sometimes presented a problem. Randal's solution? Accept credit cards through the QuickBooks Merchant Service for PCs, which is built into his QuickBooks software.*. Now, he bills at the time of service, and if a client's funds are tight at the moment, they can just charge his bill to their credit card and pay it off at their leisure. Using an optional credit card reader, Randal simply swipes the client's card and the transaction is complete.
"I absolutely love it!" Randal says. "It provides a convenience for my clients, I get paid immediately, and I save time and money!"
Being process management oriented, Randal conducted time and motion studies and discovered that it took about 35 minutes to bring a check into the office, process it, go to the bank and come back. It was costing him over $25 just to process a client's payment manually. With QuickBooks Merchant Service, everything is done in seconds and for an extremely low fee. Plus, the transaction is automatically downloaded into Randal's own QuickBooks records for faster reconciliation. For Randal, the old way no longer makes any sense. The ROI is there, he states.
In addition to getting paid right away, Randal also likes that he can use his ability to accept credit cards as a selling tool to get more business. Now when he quotes a client a price to work on something, a business plan, for example, he'll also ask if they would like to finance his fee. Instead of putting off the project because they don't have the funds immediately on hand, they can still get what they need and Randal gets paid promptly for his labor. Plus, he adds, his clients like getting miles or other rewards from their charge card companies for the transaction. It's a win-win situation for all.
"I recommend QuickBooks Merchant Service to every client, every day," Randal says. Many of his customers heed his advice after they struggle with an alternate merchant service. "They'll sign up because it's free and offers the lowest discount rate, but within 2-3 months their statement is all gnarled up," Randal explains. "Then I bring in my laptop and show my clients QuickBooks Merchant Service and they say 'I should have listened to you the first time' because reconciliation is so much faster. Even my own CPA who does my taxes; he finally saw the light, and now he's calling me and telling me it's the best thing since sliced bread!"
At a glance
- A Project Management Professional, Randal DeHart specializes in helping home building contractors be more successful by assessing their goals, then implementing QuickBooks solutions that enable his clients to be process dependent instead of people dependent in reaching those goals.
- Choosing to work with clients in a volatile industry where cash flow can be erratic, Randal improved his own cash flow by changing his business model from billing clients monthly to accepting credit card payments at the time service is rendered. He uses QuickBooks Merchant Service for PCs, which is built into his QuickBooks software.
- In addition to offering his clients greater convenience, Randal utilizes QuickBooks Merchant Service as a selling tool to secure additional projects and fees from clients who might be short on cash, and who would otherwise put those projects on hold.
* Subject to application approval. Fees apply.
Note: QuickBooks Merchant Service for PCs requires QuickBooks financial software 2005 (for the PC) or higher, QuickBooks Enterprise Solutions 5.0, or QuickBooks Online Edition (each sold separately) and a merchant account through QuickBooks Merchant Service. Application approval, an Internet connection on a Windows PC and at least Internet Explorer 5.0 required. Not compatible with QuickBooks Pro for Mac. Transaction fees apply. Additional fees apply to accepting American Express and Diners Club cards. Rates are determined by the financial institution and are subject to change without notice. Transactions are subject to Association guidelines. Terms, conditions, features, pricing, service and support options are subject to change without notice.
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