YOUR NUMBERS HOLD THE KEY
You know, I firmly believe ‘Understanding Your Numbers’ is the number one way to building a successful business and reaching your dreams. I know that when you started your business, you wanted to do it your way and on your terms. Running your own business is a thrilling adventure and for those that make it past the first few years, addictive.
Once you see those sales coming through, you know you are hooked. I am sure you have encountered a few challenges and surprises along the way. There is so much to do and learn that the last thing you want to do at the end of a week, is to sit down with paperwork.
It can be very disheartening to find out at the end of the year, or when you have to pay your taxes that you didn’t make as much money as you thought or you now have a big fat tax bill to pay that just takes the fun out of it!
The truth is, the numbers in your business hold the key.
Why are your numbers different?
Forget about P&L’s, cash flow statements and balance sheets for a second.
Instead think about heading off on a family camping holiday. Would you wait until you get there to think about what equipment you need, what clothes you should have?
No, of course not. If it were your first camping trip as a family, you would research what you need. You would probably speak to people who had done this before. If your family regularly camps, you would rely on information gathered on previous trips to help you to bring the right things.
We plan for most things in life, particularly if we have experience. (look inside a nappy bag for forward planning, practicality and efficiency). Yet, when it comes to really knowing the numbers in your business, you leave this in the hands of your bookkeeper and accountant. Why are your numbers different?
If you worked for other people before, you probably had a full-on job, where most of your time was spoken for. When you start out on your own, you have to look for things to do. So, when things start to pick up, sales start trickling in, you start to get busy. There is huge comfort in the busy – ness. Before you know it, you have associated busy – ness with success and you are happy to burn the midnight oil and dip into your weekends to make sure everything gets done.
But! Feeling you are doing the right thing and knowing you are doing the right thing is not the same thing. In business, the only way to truly know you are doing the right thing is see it in your numbers. Sales good last month? Up or down on the previous month?
Working hard does not lead to a successful business. Knowing your numbers does.
Where to START…
The first step to understanding your numbers is to stop saying you are not a money person, or a numbers person.
When I meet someone for the first time and I tell them what I do, the first thing they will say is ‘I hate numbers’, ‘I don’t understand numbers’ or ‘when it comes to money I leave that to my accountant’ (i.e. nothing to do with me and my business!).
Mindset and money is a huge issue. Money brings out our emotions like nothing else. Talking about it can be seen a vulgar, or shameful. Whatever your relationship with money is, and it is something we will touch on over the coming weeks, the first step is to stop ‘trash talking’ about you and it.
We are what we think, and what we think, we believe. So, when you talk about your business and money, speak in positive terms only. Make a note of what you say when you talk about money, how often to you disregard the numbers in your business. When you speak to your bookkeeper or accountant do you take the lead or let them tell guide you? If being positive is a struggle remember fake it, till you make it!
Over the next few weeks, I will be looking at the ‘softer’ side of money and understanding the numbers in your business. I will be looking at ‘bursting the myths’ of money and cash, how you set goals and how to make sure you have enough in your emergency fund!
How to look forward and make sure you future proof your business.
Each week I will be going live in my Facebook group ‘Understanding Your Number’s as a follow on from my weekly blog. Join me here, and make sure you do not miss out on information that will help you grow a successful business.
Each Friday, for #FinanceFriday, I will answer your questions live @ 11am and help you make 2020 your best year ever!
Have a great week!