Do you know your key business numbers for last month, or do you get a wonderful surprise in your accounts at the year end?
If you want to take control of your business, you have to live and breathe your numbers, and this isn’t just me being “an accountant”. I firmly believe that after your “Why”, the next reason for being in business is to make money. Even if you are a charity – the more money you generate the more people you can help.
You can only make money, if you use your numbers to help you make decisions. You can’t rely on the numbers at the end of last year to inform your decisions now. Heaven forbid you are relying on your last self assessment which is even further out of date.
You need to understand yesterday’s numbers to make a decision today.
That’s yesterday as in the day before the sleep you just had, I’m not being metaphorical! Do you know how much you earned and spent yesterday? And whilst I’m at it, if you don’t understand the difference between your financial statements – your profit and loss account, your balance sheet and your bank account – you are going to be at a disadvantage when you are trying to get a grasp on your numbers. They are not “all the same thing” or the “same information presented differently” as someone said to me recently!
During my discussions with soulpreneurs, I am constantly amazed at how many of them “leave that kind of thing” to their accountants. They don’t rely on numbers to aid in decision making, and worst, continue down a chosen path for far too long. Often the numbers are clearly pointing out that a change in direction is needed.
Growing your business
I’m not just talking about your financial numbers, your marketing numbers come into this too. Your cost per lead, you average customer spend, your advertising return on investment.
My HR friend, calls them the difficult shapes, and I do understand that. For some, the shapes just don’t fit together easily. So the Business Finance Made Easy workshop was created, closely followed by the Finance Hot House monthly get together. All created to help you understand and review your numbers regularly to aid your decision making.
Rant over. Kind of.
I’m reminded again of the old adage “Give a man a fish, and you feed him for a day. Teach a man to fish, and you feed him for a lifetime”. I’m ashamed to say, my profession has largely earned its living by feeding people. I’d like to change that. During my career, I’ve provided financial information to business leaders so that they can make timely and informed decisions. I’d like to teach you how to understand the basics so you can learn to feed your financial self, which in turn should help you to feed your family!
