Edition #15

A question we are often asked is for a status update on QPro and QFloors development. Did you know we have two separate development teams, working on QPro and QFloors?

Continuing our development of QPro is still a huge focus, and as such, it has the largest team of programmers working on it. As most of you know, QPro is released and we have people using it, but its features are still limited, when compared to QFloors. We have recently added even more programmers and another tester to our QPro team. Things are moving at a much faster pace and we feel good about the team we have in place.

We also recognized we need to continue to add enhancements to our QFloors program, and so we have a different team of programmers working on QFloors. Recent focuses for them have been the database upgrades, QLeads, QPay integrations, and a host of other improvements.

We continue to invest a lot of resources and energy into developing the very best software products for you.

Training can come in many shapes and sizes. And there are a variety of QFloors training resources available to you at your fingertips. We offer quick and easy access to information on our website, you can also call in and talk to a live person, or you can schedule an in-person hands-on training. You can also check us out on Facebook and join our users group, where you can bounce ideas or questions off other QFloors users. Here’s more information on all of the many training options available.

Website

Some of the quickest training resources are available to you on support.qfloors.com (you must be logged in first). Did you know we’ve been updating our short training videos, creating monthly webinars with the most up-to-date information, and organizing our written Knowledge Base articles?

Email

You are always welcome to email us anytime at support@qprosoftware.com. Every email sent to us will create a ticket associated with your account. A member of our Support team will reach out to you with a resolution or update on the status of your ticket. You can even call in and refer to your ticket number for an update on the status of your ticket. Please keep in mind that if it is an urgent matter you should always call in, rather than emailing.

Call

As always, you can call us with questions at 801-563-0140, option 2. We have a live person who will answer your call and either direct you to the appropriate department or offer a quick resolution, depending on what you are calling in about. No question is too small — we’ll take the easy calls all day.

For the best experience, during the call we will get connected to your screen to better help you. You may have noticed we are using join.zoho.com, a remote connection, in order to see your screen and help you more easily.

One-Hour Training Appointment

We also offer the opportunity to schedule a one-hour training appointment Monday through Friday, where we will set aside our time just for you. Appointments are usually out about a week out so please plan ahead. To set an appointment please call us at 801-563-0140, option 2.

Basic Training Seminar

If you’re a beginner, our Basic Training Seminar is a two-day seminar here in Salt Lake City. Designed for new customers, this training covers the basics of setting up your QFloors software and using it day-to-day. It’s a classroom format with lectures, presentations, and Q&A sessions. You will reinforce your learning with a hands-on workshop.

Intermediate Trainings

Then add to your basic working knowledge of QFloors software with our Intermediate Training Seminars. Intended for QFloors users who already know how to use the software on a basic level, these one-day Intermediate trainings are held a few times per year in different regional locations.

Personalized On-Site Trainings

Did you know we offer an On-Site Training? We can come to your location and work with you and your team to guide you through getting QFloors implemented. Or if you are just needing a dedicated day of personal training to get you going, our Virtual On-Site Training can be reserved in a four- or eight-hour remote training session for just your company. Please contact your sales rep for pricing information.

Users Conference

Here at QFloors we love helping our customers better their business and maximize their knowledge of just what your software can do for you. Every few years we hold our Users Conference. This conference includes specialized content, advanced classes, and networking opportunities with other QFloors users. This is where we hold our round table event where we empower you to share ideas and vote on the priorities and development of QFloors.

Now you know, what are you waiting for?

A QFloors user can get supplier information instantly without making a phone call or going to an external website, through fcB2B Web Services. The types of information currently instantly available (accessible 24/7) through web services are Inventory Levels and Related Items (which are accessories attached to a product like glues, trim pieces etc.). In QFloors, we can check inventory by using Check Vendor Stock, which allows the user to ask if there is enough inventory to cover a job.

Web Service features include:

• Stock Check
• Related Items
• Order Status
• Price Check
• Stock Check with Quantity

Additional information can be found on the website fcB2B.info. We’re an active member of this organization.

At times we come across customers who are not aware of Web Services and how it could be a benefit to them. It’s possible that vendors you currently work with have credentials already set up to use their Web Services. To get started with Web Services, simply contact your fcB2B supplier and tell them that you would like to open a web service account. At QFloors, we have online documentation, training videos and support resources that can assist you in getting better acquainted with this feature. You can find all of it here: Web Service Setup Training

Suppliers that are currently supporting at least some portion of web services are the following: Shaw, Engineered Floors, Mohawk, Adleta, BPI, Buckwold Western, Herregan, Jaeckle, JJ Haines, Louisville Tile, Ohio Valley Flooring. WCTingle Flooring, Elias Wilf Corporation, and William M. Bird, with many more suppliers preparing to launch. These Suppliers can be found here: B2B Table

Taking advantage of Web Services can help save time, lower stress and boost profits. Let us know if we can help you get started!

I hope most of you already have heard that QFloors recently released a new service to our customers called QPay. It is a credit card processing feature that not only provides greater integration to QFloors but a lot of other benefits as well. I talk about some of the details of QPay in this video.

Unraveling AVS

One thing I wasn’t able to mention in the video, that I think is an important benefit, is that one of the advancements included in QPay has to do with a little known security feature called AVS (Address Verification Service). The manner a credit card processing company implements AVS makes a big difference in both security and also the rate a dealer could be charged for a transaction.

With AVS, every credit card issued by a bank can be connected to a billing address tied to that card. (This is why you have to fill out your billing address when making an online purchase.) It’s meant to prevent fraud.

If you insert a credit card into a terminal via EMV or chip transactions, you’ll notice AVS is not necessary and you don’t have to give a billing address. This is because this method is more secure. But when you take a card over the phone or type it into a website, the credit card companies view this transaction as less secure, with a higher possibility of fraud. Thus they incorporate AVS to make sure the zip code and house number of the billing address match what is on record.

Ideally, both match. But at the very least, the zip code needs to match. If it does not, the fee you will be automatically charged for a transaction with “added security risk” is significant — in the range of 30-70 basis points per transaction. Or in other words, for every $10,000 in processing, you are hit with a $30-70 fee. And this may not always be a case of fraud on the customer’s part. Sometimes it’s because a zip code was improperly entered. Sometimes banks can make mistakes and put in bad addresses or zip codes. Sometimes the card-issuing banks don’t support AVS. But regardless of why, you (the dealer) are just automatically hit with these high fees if the cards are allowed to be processed.

Many credit card processors kind of just take a “not my problem” approach, and let the transactions go through with the expectation that the dealers will just cover the cost. In addition, if you take a card and process it and it is fraudulent, or if it is a chargeback, your liability is much higher.

At QPay, we wanted to protect you — both from fraud (which has really spiked since Covid-19, the credit card companies say), and from getting dinged with these high charges. So we notify the dealers if you are about to experience one of these less-than-favorable transactions. You can then determine, with the customer and his/her bank, what the issue is, or you can protect yourself from being victimized.

This is just one more way that QPay can help dealers save money on their credit card processing. There are many more. If you’d like to learn more about QPay, reach out to our sales team at 801-563-0140, option 4.

This has been a rollercoaster of a year hasn’t it? At the beginning of 2020, the economy in all areas of the country was humming along and most businesses were doing well. When Covid hit and governments shut down huge parts of our economy, many business owners were afraid for a few months if they could survive a shut down for long. Now, instead of asking what they should do to survive, they have started to ask about how to deal with their success:

“What should I do with my profits?”

“My business is growing, sales and profits are increasing. What should I do next and when should I do it?”

“What should I do with my extra cash?”

The answers to these questions? It depends on what your goals are. Some want to just put away as much cash as they can for the next rainy day or for retirement. Most owners, however, want to expand and make their business more valuable, either for themselves or to sell to someone else. Prior to embarking on either route, make sure you have built a solid foundation. Here’s how:

• Pay yourself, your employees, and your installers the deserved raises, bonuses and benefits that you necessarily delayed during the dip. Finding and keeping good employees, especially sales managers and salespeople, is the most critical success factor in our businesses. Increasingly, the most important human resource for a growing contractor business like ours is our installers. If you are more than 3 weeks out on your installation schedule, this is a bottleneck in your business and you won’t be able to grow much bigger–despite your planned investments–without rectifying this situation first.
• Prepare your business to survive the next downturn by paying off or getting out of bad loans. Bad loans and too much debt contributed to the failure of roughly 25% of floor covering businesses in the last recession. Get out of bad debt while the getting is good. What’s a bad loan? It’s any loan with high interest rates or variable interest rates. Credit card debt is the worst kind. You should be paying your credit cards off every month. Interest rates will have to rise within the next few years.
• Pay down your credit lines (they have variable rates), and pay them off completely if you can. You’ll need room on the credit line if/when the next recession hits. You can’t assume sales volume and profit margins will stay the same or get better indefinitely.
• Consider paying off equipment and car loans. Use cash to pay for the new ones if possible, while avoiding leases. The lower your monthly payments, the more flexibility you will have to effectively use your working capital to safely and methodically expand your business.

Don’t skip these steps. This is the necessary foundation you need from which to launch your expansion. If it takes several more years to find and train the right people and get rid of the bad loans, then use whatever time it takes.

Now, look at your current ratio (sometimes called working capital ratio) on your balance sheet. This is calculated by taking total current assets and dividing that by total current liabilities (current assets/current liabilities). An efficient business should be somewhere between 1.2 to 2.0.

If it’s lower than 1, it means your current assets are lower than your current liabilities and you’re probably struggling to pay your immediate bills, let alone having the cash to make important investments in order to expand. If your ratio is over 2, then you’re not using your available working capital effectively and you certainly could and should be expanding/investing faster than you are

On the other hand, if your ratio is slightly above 1.2, you can’t go out and buy anything you want. You should only consider investing in things that, after the investment, don’t drop your ratio significantly below 1.2. Remember, when you invest in equipment, software, real estate etc., you are converting cash (a current asset) to a fixed asset. This will lower your current ratio immediately. Any working capital ratio above 1.5 means you’re definitely ready to expand–if that is your goal.

Next, evaluate and upgrade the assets/equipment that will help you run efficiently. Items such as computers and software, cutting machines and forklifts, delivery trucks and trailers would fall into this category. Can you increase your capacity with the assets you already have in place or do you need upgrades in this area? Again, avoid borrowing and try to pay cash for these things if you can. If your current ratio is 1.5 or more, then you should have plenty of cash to buy the necessary equipment needed. If you don’t have enough cash, then you probably have a receivables problem and/or an inventory problem.

Here are some of the other areas of expansion that owners usually focus on, often prematurely. All store owners want to sell more and make more profit, right? Most try to do this by getting business from sources that don’t necessarily physically walk into their stores (think builders, property managers, commercial). These categories of additional business revenue will increase profit dollars, but they will also use a lot of cash by way of higher receivables. Remember the role bad receivables played on business failure in the last recession? Make sure that no customer ‒ should they not pay their bill – has the ability to cripple your business.

Another enticing expansion investment for owners is inventory, for its ability to increase both profit margins and product volume. It’s true there are great deals out there if you buy rolls, truckloads, and containers; however, by doing so, you may be gobbling up the cash you need for other expansion investments. The industry average for inventory turnover (annual sales/average inventory) in the last few years was 6.1. If your operation is below this level, then you probably have too much inventory.

If and when you: 1) feel like you have the right people (human capital); 2) have eliminated your bad/unnecessary loans; and 3) your working capital ratio is above 1.2 and you have extra cash, then you may be ready to expand your business by adding equipment or locations or both. Using a similar model to the one that made you successful in your current location can work in another. It should be especially profitable with the management and back office economies of scale you gain with more locations.

Moreover, with a balance sheet such as I have described, you can obtain financing to purchase real estate (instead of just renting) if you so choose. Over the long run, it’s better to own than to rent. A down payment on real estate will require 20% of the total price, so plan your cash outlay so as not to make your current ratio go below danger levels. You can get a Small Business Association (SBA) loan with only 10% down, but keep in mind that a big part of the SBA loan (the bank’s portion) will likely be subject to variable interest rates. So, be careful with these.

Finally, having healthy levels of working capital will give your business financial stability while providing expansion options to take advantage of specific opportunities, such as necessary equipment, inventory, or real estate. Don’t take shortcuts. If you do, you put your planned expansion and your business itself at risk.

In addition to creating the bill to actually record paying your sales/use tax, there’s an adjusting entry you might want to create for that sales tax period so that your Sales general ledger balance doesn’t include sales tax in it.

Why is this necessary in the first place? First, your financial statements are correct. However, in order to simplify accommodating and accounting for the sales and use tax for all 50 states, the QFloors software includes the sales tax amount when it posts to the Sales general ledger account. For example, if a sale subtotal is $1,000.00, and the sales tax is $78.50, therefore the total is $1,078.50, QFloors posts the full $1,078.50 to the Sales account, not just the $1,000.00. In accounting language, that posting is a “credit” entry. The offsetting “debit” is posted to the Sales/Use Tax Expense account. Follow the steps below to remove the sales tax amount from the Sales account and also from the Sales/Use Tax Expense account.

As mentioned above, your financial statements are correct because the Sales account includes the tax in it, so Revenue shows higher, but the tax is also posted to Sales/Use Tax Expense account, which reduces overall net income. So you could leave everything as it is, but here’s what you need to do if you want to adjust the sales tax out of the two accounts.

First, watch the webinar and training videos on our website so that you know all the other aspects of sales and use tax in the QFloors software.

Sales/Use Tax
Basic Training Part 2

Next, before finalizing your sales tax report, see if there are any sale lines that are dated in prior periods as in the image below. If there are, you’ll need to make an adjustment to those prior months as well as the sales tax month you’re working on.

You should not have that situation. If you do, it’s most likely because you’re not closing the general journal monthly. Please carefully read and follow the instructions in our Knowledge Base article, Close Period – Closing the General Journal.

After finalizing your sales tax report,

• If you did not have sales from prior periods included, then scroll to the Grand Total section at the bottom of the first page of the report (the Location Summary page) and get the Total Tax amount from the Sales Tax Inv column.
  
• If you did have sales from prior periods included, select the Detail option at the top right of the report, then export that detail report. Open that CSV file in a spreadsheet program then group and sort all of the data where the Type is “Sales” to get the Total Tax amount for each monthly period.
  

To create the journal entry adjustment, follow the instructions in our Knowledge Base article, How to Create a Journal Entry.

Date the entry for the last day of the month, and use the amount(s) you obtained from one of the two bullet points above. You need to debit the Sales account (a positive amount) and credit the Sales/Use Tax Expense account (a negative amount). NOTE: If your sales tax report has sales data in a prior fiscal year, and you have already submitted financial reports to your accountant for that year’s tax return preparation, talk with your accountant before making an adjustment dated in that year. If your sales tax report has sales data in a prior fiscal year, and your income tax return has already been filed, don’t make any adjustments dated in that year.

As always, please email or call our Support team if you have any questions, and thank you for using QFloors!

Sincerely,

Ron Cluff
Director of Training

I have great news! We will be hosting our biannual QFloors Users Conference this upcoming fall. These conferences are incredible opportunities for expanding your skills and knowledge, learning from one another, and impacting future development. Those who have attended in the past generally come back, because they recognize the value.

The conference has training classes (mostly intermediate in level) on QFloors and its various add-on products. We cover new features and capabilities of the software. There are roundtable discussions defining development into the future. You will (of course) also see the latest version of QPro, and get an update on its progression.

I had hoped that in this newsletter article I would share the specific resort and dates and pricing for you but unfortunately, that is still being negotiated. We know that the event will be held in Utah, and will occur a Wed-Fri between Labor Day and mid October. We are talking with several resorts (all fabulous, by the way) in Park City, Salt Lake City, Midway, and some surrounding ski areas. Autumn is generally a scenic time in this mountainous area.

Look for an email with this information and registration within the next month.

We have been told multiple times by industry attendees that these conferences are unlike anything they have attended, as far as the positive energy, collaboration, and idea sharing. Part of this is because our customers really are the brightest and best people in the industry… we’re convinced of that. To that point, we have often been told by customer attendees that hearing ideas, presentations, and “how do you handle….” insights from other QFloors customers is one of their favorite parts of the event.

And of course, this is your chance to voice your “I-really-wish-the-software-would…” suggestions, and vote on our development To Do list.

We’d love to have you join us next fall. Pencil it in your calendar, and keep your eyes out for future communications! An email will be sent out soon with more details.