How was business last month, do you know?
Perhaps you respond: ‘I was busy and there is money in the bank.’ Being busy does not mean PROFIT, positive CASH FLOW or progress.
Business owners need to earn a living at the very least. However, if you are not reviewing the numbers and receiving regular financial reports, knowing how you are really progressing can be difficult.
THE NUMBERS DO NOT LIE. Your perception of business performance based on your knowledge and experience is useful, but doesn’t always paint the full picture. It’s easy to make the wrong decisions about the future if you don’t make the time to review and understand your numbers.
At the very least, you need to understand terms like gross profit, net profit, operating cash flow, liquidity, debtors and of course sales. And of course there is most likely a host of other numbers than can give you a real insight into how your business is performing on a day to day basis. Do you look at these numbers regularly?
Understanding your business ‘key performance indicaotrs’ can help you to understand if you are under charging customers, paying to much for supplies, not collecting your sales quickly enough and much more. It will most likely lead to changes that will give you a more profitable business and a more enjoyable life.
Have a quick look at the infographic below to see if your business is ticking the boxes which are critical to success; working with the right systems and software, collecting your debts on time, being cash flow positive and, most importantly, having the right staff and external advisors.
You don’t have to become an accountant to have a real understanding of the numbers. Instead, ask for help from Jack Lawrence Accountants. We’ll show you how you can use technology to get access to the numbers that are important for you in real time.
If you want to have a chat about your business financial challenges and needs, just get in contact with me for a complimentary, no obligation meeting and more. At Jack Lawrence Accountants, we’ll make your business life easier.