Author: ARRC Technology

Life can be ironic, can’t it? We’re not just talking about the “Rain on your wedding day” kind of irony, either. It seems that Microsoft and anyone who works in the tech field — ourselves included — have been harping about how Windows 7 users need to upgrade before its End of Life happened on January 14^th. And what else happened on that day?

Well, Windows 7 did meet its End of Life, but the NSA also came out with a warning that Windows 10 — and all other platforms that Windows 7 users were supposed to move to — had a massive security threat. So, how important is this, and more importantly, how does this affect you and your business?

Conflicting Stories

Microsoft has been pretty tight-lipped about this whole situation and has already rolled out a patch, although they’ve only labeled this as an important update, not critical like they have for similar issues in the past. Industry experts feel this can be a way of trying to play down a major issue, making it seem like this is nothing more than a minor hiccup. This might have worked had the NSA not said anything.

The NSA has been notorious at finding exploits in Windows, as well as other operating systems, so they can conduct surveillance without asking permission from software developers. In fact, the famous Wannacry virus was believed to have spread so quickly because hackers found an exploit that the NSA was using at the time. The reason we bring this up is that if the NSA is making this public and not merely keeping it to themselves like before, it must mean that this is a major issue that risks the security of more than just a handful of people. We’ll probably never know the real truth behind the matter, though we can guarantee that there is plenty of information that is not being shared with the general public.

The Windows 7 Connection

Both Microsoft and the NSA made their announcements on January 14^th, so it stands to reason that this must have been a known issue for a while. Which begs the question, why didn’t anyone say something sooner? More likely than not, it was probably because Microsoft had been pushing the Windows 10 upgrade for so long that if those who hadn’t upgraded from Windows 7 heard about the gaping flaw, it might have given them an excuse to hold back.

From what it looks like, the issue stemmed from a program that interfaces with digital signatures and determines whether or not a program is legitimate and licensed. Somehow there was a vulnerability in the sequence that opened a door so huge, even the NSA considered it too much of a breach of privacy for individuals and businesses. As far as we know, this was not an issue on machines running Windows 7.

So, I Might As Well Stay With Windows 7, Right?

Not so fast, buddy. Yeah, we’ll be the first to admit that this whole situation doesn’t smell right and was most likely the result of Microsoft trying to save face, but don’t make this is an excuse to stay with Windows 7 if you haven’t already upgraded. Security concerns are a fact of life and having one doesn’t make Windows 10 any better or worse than other versions. Think about your favorite version of Windows and it probably had dozens of issues that needed to be resolved over the years. Yes Microsoft indeed caused this problem themselves and it wasn’t just a way in that hackers devised, but again, that’s to be expected from time to time. Both Microsoft and the NSA said that neither was aware of anyone having been pirated as a result of this vulnerability.

When it comes down to it, here is the hard fact of the matter: although this flaw in Windows 10 wasn’t great, it was fixed quickly, and any other issues or vulnerabilities will be continued to be fixed for the foreseeable future. Windows 7, on the other hand, is dead and is never coming back.

Think of it this way: would you still run Windows 95 on your computer? Chances are your answer would be an emphatic no. And why not? Most likely due to a lack of functionality and security issues. Well, if not Windows 95, why not Windows 98, NT, ME or XP? Probably for the same reasons as for Windows 95.

Although Windows 7 still works and was just recently updated, it’s no different than any other previous version of Windows. Those who still use older versions can be and are hacked regularly. Why? Because they aren’t supported, so hacking them gets easier every day.

Looking Ahead

We understand that if your business still hasn’t updated from Windows 7, there is most likely a good reason besides just being lazy. There are always several considerations to making changes, such as hardware upgrades, data migration, and even software compatibility. For a company that isn’t equipped for all of this, upgrading may be an overwhelming prospect.

If you find yourself in that situation, please contact us to see how we can help your business move forward and stay there. Whether you need a one-time service or perhaps full MSP coverage, our team of professionals is here to help.

It’s true that we’ve been running around like Chicken Little, shouting about Windows 7 End of Life, but you know what? The sky has fallen — Windows 7 is dead. That’s right, we are past the End of Life date and Windows 7 is no longer being supported by Microsoft. At least that’s what they are saying.
“But wait,” you say. “My computer system still works. In fact, I’m reading this on a Windows 7 computer right now!” While it’s true that Microsoft didn’t pull the plug on the operating system, that doesn’t mean that you should still be using it. And if you are clinging on to that dated technology, we’ll offer you 7 reasons why you should upgrade from Windows 7.

#1. No More Updates
Ok, so we’ll get the big issue out of the way first. Microsoft has ceased releasing new patches and security updates for Windows 7. You might feel safe for now, but hackers will soon learn how to get past the latest security barriers, as they always do. In the past, that wouldn’t be that big of an issue as Microsoft would regularly come out with new patches. Something that won’t be happening now.
When hackers find a new way to get in, not only will they cause as much havoc as possible, they’ll also share or sell this information on the Dark Web. Then it will be open season.

#2. Large Target
Some people figure that if they continue to use the outdated OS, it’s no big deal since most people have already switched to Windows 10. The thought is that hackers going after a handful of people on the older systems isn’t worth the time. Yes, most Windows users have indeed upgraded, but keep in mind that there are between 1.2-1.5 billion current PC’s running on Windows. The US Digital Analytics Program estimates that as of December 2019, 18.7% of those users were still on Windows 7, which would add up to almost 300 million users. If you were a hacker and you had a pool of potential victims who were using an operating system that is no longer supported, you would most likely dedicate your time trying to pirate their systems. The path of least resistance.

#3. Speed
The newer Windows OS is much leaner on the backend. Take booting up as an example. On average, you can save more than a minute starting up your computer. That may not sound like much, but think about how much time that saves over the course of just one year. Assuming you work five days a week for an entire year, that’s 260 minutes (4.3 hours) of you unnecessarily waiting at your computer. If you have a team of just 20 people, that would be 87 wasted man-hours every year!
That’s just the bootup time. Even web browsing is faster! The newer OS platforms use more web and cloud-based applications. Less network interaction between your computer and server means faster runtime across the board.
#4. Touch Support
When Windows 7 came out, touchscreens were still a novelty. Now, since everyone is using tablets and smartphones, more and more applications for touchscreens on PCs are commonplace. These can range from signatures to graphic design and beyond. Given, this alone probably isn’t a reason to upgrade your entire network, it’s still a great feature that we’re sure you could likely benefit from.

#5. Connect Everything
Ten years ago, we were all just babies when it came to connection. Remember taking pictures on your digital camera then connecting it to your computer with a USB cable? You know, like a caveman?
Now you can link your phone to Windows and have pictures, videos, weblinks and more instantly available on your workstation. You can also connect screens with a colleague or customer without having to download third-party software and go through a long process of trading logins. Lastly, and perhaps most importantly, you can upload and backup your documents using OneDrive. This is a great tool if you’re a very small operation or as a backup to your backup in a larger business.

#6. Your Software Has Already Moved
One of the many arguments we hear about is the cost and hassle of purchasing and installing new software. Sure, it might be a small investment to get with the times. but you know what? There are companies out there using software that runs on MS-DOS, too! You can only justify not upgrading for so long before you become obsolete.
Sure, there are indeed unique custom software programs that large companies — such as banks and hospitals — use that would cost millions of dollars to upgrade and migrate. However, for 99% percent of the rest of us, it’s best to just suck it up and move on with our lives. There are few if any programs out there that can’t migrate that are worth keeping around. Chances are that if your software hasn’t upgraded, there are probably a dozen others available that can do the job better.

#7. New Features
Wow, this is a big one. We could dedicate a month’s worth of articles about the new features between Windows 7 and 10. You’ll find new features that used to only be available with expensive third-party systems such as advanced voice-to-text recognition. Some updated features are beefed-up copy and paste abilities, the ability to edit screenshots, virtual desktops and even a digital assistant — Cortana.

At the end of the day, you really do need to upgrade no matter what. If you’re still part of the undistinguished group of Windows 7 users who aren’t sure what the next step would be in upgrading, we’d be happy to talk with you and go over your options.

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.

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!

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.

While many of us may not physically see our servers as often as we see our personal terminals, we interact with them directly or indirectly daily. Within your office network, the server is the heartbeat of the entire system. Since we rely on them without directly interacting with them we tend to forget that they’re there. However, just like with any other type of computer, servers can expire and need replacing from time to time. Have you checked your servers lately?

 

Section 179 Deductions

For those that have been following our blogs this month, you’ll recall that our topic is Section 179 tax deductions. As a quick recap, this is a section of the tax code that not only allows you to write off purchases made for business purposes, it will let you take the full value at one time versus the past option of making you deduct a depreciated percentage over multiple years. While it doesn’t give you credit for the total cost of your business investments, it does allow you to legally avoid paying tax on the funds used for these purchases.

The purpose behind Section 179 is to give businesses a break when they are just starting out or are expanding, therefore allowing them a chance at making a profit (or at least avoiding too much of a loss) while making major purchases. While the total amounts are subject to change, the law currently allows write-offs of up to $1 million for single purchases and a maximum of $2.5 million total per year.

As always, we need to remind our readers that we are not tax experts and this information should not be taken as the final word. Every business and situation is unique, so please consult your company’s CFO or other tax and accounting professionals before making any decisions or purchases.

 

Are You Ignoring Your Servers?

As we mentioned earlier, your servers can be an “out of sight, out of mind” affair. However, if you’re working on an internal network, (in the same building or remotely), you are likely interacting with one or more servers throughout most of the day. Just like with terminal computers, they are subject to a finite lifespan, either becoming obsolete or just wearing down. This can cause several potentially critical problems for your business. For instance; network speed might become an issue. This can affect how quickly information travels to and from the server and your computer or between users of the network itself.

In addition, storage can become difficult to access. While servers typically have much more capacity than the average desktop or laptop, that isn’t to say that it’s unlimited. Cloud storage and data back-up are becoming increasingly popular these days, but that’s not to say that there aren’t situations where it would be preferable or necessary to stick to a local, physical server. For example; if your office deals with sensitive medical information you’ll need to remain HIPPA compliant, and cloud storage may not be a safe choice for you. That means you’ll have to be extra diligent about keeping your on-site servers and back-up systems healthy.

 

Backups Don’t Last Forever

Many of us remember when we first used floppy disks or CDs for our computers, thinking about how they would outlive us — only to have our expectations dashed with corrupted data after just a few uses. Back-up systems in any form have their limitations, such as magnetic tapes becoming demagnetized or servers getting an unexpected electrical charge. Whether you’re using a back-up drive or a physical format, you need to understand that if you are archiving information that needs to be stored indefinitely, you’ll need to plan to transfer that data to another form of storage every 5-10 years depending on technological advancements.

There is a fairly new medium called M-Discs that, due to their unique material and technology, are reported to keep data safe for 1,000 years. While that may be theoretically possible, try to convince the horde of dads who bought those 100-year lightbulbs for $40 apiece only to have them burn out in about a year! Remember that no matter what the company selling to you may say, nothing is permanent. If your data is worth keeping, it’s worth transferring every few years.

With that in mind, as the year comes to a close, perhaps this would be a good opportunity to look over your current equipment and see where you stand. If you can’t find any records to tell you the age of the drive, checking to see when the first files were transferred could be a good place to start and at least give you a good estimate.

 

Now’s the Time!

Remember that both servers and back-up devices are important elements of many pieces of equipment that need to be updated and replaced at some point. If you’re coming to the end of 2019 and finding that you had a better year than expected, or have unused funds sitting around, take advantage of Section 179 deductions so that you can lower your tax liability while making business-critical equipment upgrades.

You’ll never know what tomorrow will bring, let alone next year or the year after. It’s impossible to predict if you’ll have the funds when the servers or backups fail or simply don’t have the time to address the issue. By upgrading your equipment while we’re still in tax year 2019, you’ll be setting yourself up for success for next year and possibly the years ahead!

The worst kept secret in the IT world right now is that Microsoft will end support of Windows 7 on January 14^th of 2020. If you’ve been following this story at all, perhaps you’ve seen that many people are discussing this across all industries. And if you haven’t been following it, you’re probably wondering why this is such an important topic. It is important because it may affect you and your business.

Why Windows 7 EOL Matters

It may be hard to believe, but Windows 7 has been out for over ten years! At the time it came out, it was heralded as a new beginning for Microsoft — since they were just coming off of a series of disastrous releases mixed in with their successes.  (If you don’t remember Windows ME, you’re better off). The next version that came out, Windows 8, appeared to be another dud, so many users held onto Windows 7 as it was a proven operating system. Unfortunately, this has stopped many users from upgrading since then. In fact, some estimates from earlier this year show about 1 billion computers still running Windows 7!

What End of Life for Windows 7 means for you is that Microsoft will no longer provide support or updates for that operating system. While there will be some exceptions, (you will be able to pay substantial fees for certain updates and limited support), all Microsoft support will be done away with within three years. Even so, the cost of this supplemental measure is more than updating to Windows 10, so why spend money on a dying platform?

Hackers are paying attention to this deadline, so you should too. Older versions of Windows, for both computers and servers that have surpassed support, have continuously become victims of hacking campaigns. Remember; when a hacker finds a way into Windows, the team at Microsoft figures out how it’s being done and will send out a patch, which is the whole point of security updates. With Windows 7 being at the end of its life, once the updates come to an end and a hacker finds a way to exploit the system, you can be sure that he’ll be telling all of his friends how easy it is to breach.

Section 179 to the Rescue!

With all the new security benefits plus the updated features of Windows 10, what possible reason could someone have for not upgrading? One of the most common reasons is cost. While upgrades used to be free, Windows now charges $99 per license to upgrade. That can be a significant charge for anyone, and it’s especially costly if you have to purchase software for  multiple terminals.

As we’ve mentioned in previous blogs, Section 179 allows companies to take deductions of the full value of the property purchased for business purposes within the same business year. If you make the purchase this year, you can upgrade the software on your office systems and take it as a deduction on your 2019 taxes. While that doesn’t exactly eliminate the cost, it will make your burden much easier to bear.

Not Just the Software 

The other reason for not upgrading is that while businesses would like to upgrade, their hardware won’t support the new OS. This is a valid argument since many of the machines that came out around the time Windows 7 came out, which is ten years ago, are not able to support Windows 10. Or would run very slowly at the very least. If you find yourself in this camp, the fact is that you’ll need to upgrade your hardware to use Windows 10.

However, if you are currently using computers and servers that are out of date, it would probably be in your best interest to upgrade for reasons other than just Windows. Many other software programs that you currently (or would like to) use may not be able to run their latest versions on these terminals as well.

Just like with the OS software, while there is an upfront cost involved, you would be able to include any hardware updates with the other Section 179 deductions that you currently have for the tax year 2019. Note that this also includes any related costs. For example; you may pay for shipping or set-up in addition to the actual cost of the machinery, so you can write that off, too. Did you include service contracts, warranties or insurance fees? That would be included in the deduction as long as it is implemented this year.

The fact of the matter is that time is running out. Thankfully, Section 179 deductions help to lessen the blow of the cost, though this isn’t something that can be pushed aside indefinitely as there are real consequences to consider.

While we are discussing the theme of Section 179 deductions in our blogs this month, we need to remind our readers that we are not tax advisors. The information we provide is for general discussion, and before making any decisions, please speak with your company’s CFO or other tax and accounting professionals. That being said, remember that current Section 179 laws allow you up to $2.5 million in deductions that you can write-off in 2019. If you find yourself in need of a system upgrade, now is the time to do it!

Managing a business is a lot like managing your weight — if you take in more than you put out, then you’ll have major gains at the end of the year. And with both business and personal weight, those gains can have consequences.

As a business owner, the goal is to make as much profit as possible, but remember that those profits come with a nasty little caveat: taxes. The higher the profit, the higher the tax. Thankfully, this year Uncle Sam will show some mercy come tax time in the form of Section 179 deductions. As a disclaimer, we are not tax advisors and any planning or decisions should be reviewed or undertaken by your company’s CFO or accounting professionals. Look at this as an overview to motivate you to take advantage of this new law.

 

What Are Section 179 Deductions?

When we talk about 179 deductions, these are the classic “write-offs,” but with an extra benefit. With many write-offs, you can only take partial deductions over a few years. For instance, you buy a car for business but you can only write off a portion of the car’s value for the next five years. By definition, Section 179 in the tax code allows a business to deduct the value of a property that was purchased for the business against any profits (or losses) that may have been made throughout the year it was purchased and implemented, thus lowering the total tax burden. This “property” falls into the following categories:

Business Personal Property: This would include anything purchased for business use that isn’t bolted to a floor or wall. This includes furniture, computers, software — even paper and pens!

Machinery and Equipment: This includes items purchased for businesses that are too large to move or might physically be bolted down. An example of this would be a printing press or conveyer belt.

Business Vehicles: These are cars or trucks that have a gross weight of more than 6,000 lbs and are used exclusively for business purposes.

Listed Property: This is property used for business purposes. What’s interesting here is that it doesn’t have to be 100% business-oriented, though you can only write off the portion that is used for business in proportion to time used. For instance: if you have a home office and you work for eight hours a day for five out of seven days in a week, that means that your home would be used for business purposes about 23.7% percent of the time and therefore you could possibly write off 23.7% of your mortgage.

Capital Improvements: If you make improvements to a building used for business, you can write off that expense. This also includes items like air conditioning or alarm systems.

 

What Does This Mean For Small Businesses?

It would not be an over-exaggeration to state that many small businesses wouldn’t exist without these deductions. While Section 179 deductions may just mean larger profits for large corporations, they may end up being the entire profit margin for a small business. One reason for this is that capital expenditures make up a larger proportion of the total costs of smaller businesses compared to larger companies. Having the ability to take these write-offs in a single year can make all the difference in the world.

In addition, by having the ability to purchase equipment and property on such favorable terms, a small business may be able to purchase more than they initially planned on, thus helping them grow at a faster rate. On the other hand, if a company doesn’t need more equipment or other purchases at that moment, they could invest the tax savings in other ways, such as hiring more employees, which can also contribute to business growth. As of 2018, limits have been raised from $1 million per qualified capital purchases up to $2.5 million. This is certainly more than enough for most small businesses!

 

Include Deductions In Your Budget

Some view tax deductions as a bonus, but that shouldn’t be the case. When creating a budget, deductions should be included as a part of your income or at least as a justification in increasing expenditures. Small companies, especially when new or in a growth phase, need all the liquidity they can get.

As we are nearing the end of 2019, are you finding your company has extra funds sitting around? By taking advantage of Section 179 deductions, perhaps you’re now realizing that you will have more to write off this year than initially thought and you’ll have a lower tax burden than you’d planned on. Therefore, you may want to consider investing in yourself for next year. Budgets for newer businesses are notoriously difficult to plan since income forecasts won’t be as predictable as they are for established businesses. While the economy is strong at the moment, we all know that this can change at the drop of a hat.  If things are going well this year, it would be smart to capitalize on that by getting ahead of some of next year’s purchases.

That extra ten pounds you’ve gained this year may not be doing you any favors, but the gains your company made will not only put more money in your pocket, it can also help you invest in the future. If you have any questions, consult with your tax professional to see which Section 179 deductions can be a boon to your bottom line.

Using technology in any business is an absolute necessity in the modern world. For this reason, most larger businesses employ CIOs to oversee the technical aspects of business, ranging from purchasing to implementation and maintenance.

While this may work for large corporations, many smaller businesses find themselves without a single, dedicated IT professionals on staff, let alone a department with a CIO. However, that’s not to say that companies of this size wouldn’t benefit from this type of support. Are there other options available?

vCIO

A term that has become common in the small business world is vCIO or virtual Chief Information Officer. No, this isn’t some sort of hologram that shows up to company meetings. It’s possible for an individual to fill this role remotely, but it’s best to hire a Managed Services company to perform the tasks the CIO would.

There are a series of reasons why a Managed Services provider would be beneficial. First, this type of service usually costs less than the salary of a dedicated person with the needed qualifications. While individual humans tend to make mistakes from time to time, a team of people doing the work has more checks and balances in place to make sure that the job is being done well. Beyond these generalities, what exactly are the benefits of a vCIO?

Seeing the Big Picture

Two of the major jobs of a CIO is to create the entire technology system as well as plan for the future. Are you planning on expanding the number of computer terminals? Perhaps you will eventually move your server storage to the cloud? What sort of backup system is in place currently and how are you budgeting for upgrades and maintenance? A vCIO would make these types of plans for you. Naturally, you make the final call, but they put forth an expert recommendation with a plan for follow-through.

Taking Care of the Little Things

The more technology is running in any given operation, the greater the likelihood of something breaking. Most small businesses don’t have the time or expertise to handle the day to day maintenance of their systems without diverting attention from other areas. Even if an employee has the time and does well with his/her home network, business equipment should be in a category far above consumer-grade. For instance, maintaining a server with a Windows Server OS utilizes a completely different skillset than using Windows on a desktop PC.

Along with the previously listed points, efficiency is a major benefit of using a vCIO. Let’s say that someone in your company is technologically inclined. If an issue arises, that would take them away from their normal duties. In addition, the amount of time and effort you need to fix the problem may be much more than someone who deals with similar issues regularly. Think of having to search for passwords and how long it may take to look up error codes online. In the end, you’ll probably still need to bring in outside help, taking even more time to fix what would be a routine task to a dedicated managed services professional.

Never on Break

The only thing that is more of a burden than hiring a dedicated IT professional is hiring an entire team. Many businesses have some sort of operation running 24/7. Even if you have someone on staff, how many hours can they work in a day or week? What happens if they called in sick or take a vacation? vCIO services will have people on call around the clock, day and night. If it breaks at four in the morning on a Saturday, a vCIO will address it well before someone shows up Monday morning, unable to work.

Just in Case

Once the systems are up and running, support issues tend to drop. Does that mean that all your needs are met? Well, even the most skilled backyard mechanic needs to bring their car into the shop occasionally. There will be times when a system needs a major overhaul, such as hardware or software upgrades. This requires a large amount of time and expertise. If your company finds itself in an emergency, like a virus spreading through your network, you need intense intervention. A vCIO can help you weather such a storm until you’re able to get back on your feet. For many companies, these are the sort of situations that convince them that they need a vCIO moving forward.

As we’ve discussed, vCIOs may or not be the best solution for your company. However, if you currently find yourself without a dedicated, technical professional on staff, you may want to research your options. A relatively small investment in this sort of service will, more than likely, pay off big in the future.

If you own or run a small business you know, better than anyone, that it’s not easy work. It takes a lot of time and energy to meet the demands expected of you every week. That’s why certain aspects of running a business, such as cybersecurity, often take a backseat to other, more urgent issues. Many small business owners look at cybersecurity as something they’ll get to when they have the time. Others rely on whoever in-house knows the most about computers.

Some employees might have the basic computer knowledge to get by, but a do-it-yourself (DIY) security approach isn’t the best choice. Let’s take a look at some reasons why outsourcing cybersecurity might be your best solution.

The Numbers Don’t Lie

In a recent survey, 87% of small business owners felt they were at low risk of ever being attacked. Even more alarming, 30% had absolutely no security solution at all. However, since 2016 at least 50% of small businesses have had at least one cyber-attack of some sort. That appears to mean that 37% of small businesses have already been attacked and still feel at low risk.

On average, a small business has a 60% chance of shutting down within a few months of a breach. Let that sink in. While many small businesses play fast and loose with security risks, the majority won’t live to tell the tale past a hack. A huge percentage of small businesses are happily swimming in the waters of commerce unaware of the school of piranhas forming underneath them because most of the previous victims have disappeared without a trace.

No One Is Too Small

Small businesses falsely assume that no one sees their company as attack-worthy. They think larger businesses are bigger targets due to their size and income.  Everyone is a target. In fact, it’s worse for small businesses because they not only have less ave less security, but their valuable information often lacks appropriate backup.

What’s Good for the Goose Isn’t Good for the Gander

When implementing cybersecurity prevention for a small business, many people turn to what they’re familiar with. This often takes the form of relying solely on basic virus protection. While programs like these are certainly better than nothing, there’s more to do than controlling the spread of viruses. Cybercriminals are more motivated than ever before, and some hackers even work in teams to attack your computers until they find a way in. Single-layer, consumer-level solutions are not the best defense.

The Rising Threat of Ransomware

Hackers are far from dumb criminals. They know exactly what they’re doing. If a hacker encrypts the information on a single computer in a small business, there’s a good chance they can infiltrate the rest of the business, holding it captive using a ransomware attack.

When a hacker takes over your information, they hold it hostage until you pay the ransom, just like in a physical ransom situation. Just how much ransom are we talking about? According to some experts, half of all ransomware payments made by businesses amount to more than $10,000. 20% are more than $40,000. If you’re a large corporation, that could be a drop in the bucket. But for a small business, the cost is far more damaging. The ransom payment could amount to months of payroll. It’s no wonder that many small businesses close up shop after being attacked just once!

The Bottom Line

Take heart. This is not a hopeless situation. Nothing could be further from the truth! A small business simply needs to prepare. One of the biggest hurdles to having a comprehensive security plan is the cost. Most small businesses dream of having one dedicated cybersecurity person, let alone supporting a division like many larger companies. What is a more reasonable option?

MSPs (Managed Service Providers) are a way of outsourcing this difficult but important aspect of your business. Find a company that deals with small businesses regularly, like we do. MSPs understand the best ways to implement a security solution appropriate for your unique situation at a reasonable price. After all, a solution will only work if it keeps pace with the cybercriminals who are after your assets.