If you ever have problems managing the money and numbers side of your business then…
Stop Being Afraid to Look at Your Numbers
Seriously, what are you afraid of?
Are you afraid that the numbers might tell you some bad news as if you didn’t know already that you have cash flow problems?
Are you afraid that you might look stupid if anyone asks you about the numbers because you don’t know what they all mean?
Or have you been bamboozled by the accounting industry into thinking they’re complicated and you have to be an accountant to understand the numbers?
Whatever your reasons are, you can change the situation by making a decision to look at your numbers in a different light.
If the numbers tell you bad news, consider this as a good thing because you can use that knowledge to change what you do to get a different result.
If you think you’ll look stupid because you don’t know what the numbers mean, read a book or more of my articles, do a short course, or if you’re really brave, ask your accountant for help.
If you think accounting is complicated, it isn’t. Accounting is mostly adding and subtracting with a bit of multiplication and division thrown in for good measure. No complicated maths there at all.
If your accounting records aren’t kept up-to-date on a weekly basis, either make the time to do it (if you’re doing them yourself) or ask your bookkeeper to update your records on a weekly basis.
If you’re feeling like you don’t have control over your business, take some time to find out about your numbers, and you’ll feel like you’re in control of your business.
If you never look at your financial reports, make a decision to look at them monthly and put time in your diary specifically for this.
If you’re overwhelmed with the sheer quantity of numbers in the financial reports, identify three key numbers and concentrate on understanding what they are and then improving them. For more details on this, have a read of my earlier article Too many numbers and no idea where to start?
If numbers on a piece of paper just look like numbers on a piece of paper, look into using reporting tools or add-ons to provide you with graphical displays of the key numbers. Graphs are so much easier to understand, aren’t they?
If you’re struggling with inconsistent or lumpy cash flow, create a 12-week cash flow forecast to give you a framework to work to.
If you need to make important decisions, create a budget projection based on the current situation and then duplicate it and change the relevant numbers to see what the impact of the decision will be. This is especially useful when you’re expanding, looking to take on a new (large) contract, employing staff and so on.
If in doubt about the numbers, ask your accountant and if they don’t have the time to help you, find a virtual CFO or financial literacy expert to help you.
I get that most people don’t get as excited about the numbers as I do, but I know you want your business to survive and thrive into the future. One of the easiest ways to do this is to understand your numbers. By doing so, you’ll take away the fear, and the stress, and will have the knowledge to make good decisions.
So, like the Nike slogan says, “Just do it.” Take action, and you’ll overcome your fear in no timeat all.
“The opinions expressed by Smallville Contributors are their own, not those of www.smallville.com.au"
SHARE THIS ARTICLE WITH LIKE MINDED SMALL BUSINESS PEOPLE