Work those numbers
For most businesses the keeping of accounting records is a necessary annoyance demanded by HMRC. However, those VERY annoying figures are what ultimately drives your business, my business, ANY business. In fact, those figures should actually be utilised to drive all your business decisions and ultimately increase your profits – which is the aim of all (most) businesses. Even charities need to be driven by their numbers – more so. So how do we work those numbers? Firstly we need to have a GOOD SYSTEM of recording all those figures, so a decent accounting system is paramount. Spreadsheets are not good enough because they do not automatically give you instant information to make great business decisions. Cloud accounting systems are now fairly cheap – but one word of warning they do not do all those amazing things advertised on TV/Radio unless you understand what you are doing, what you are recording – so make sure you learn all the basics of how to use that system. If you find this too difficult then OUTSOURCE to a Bookkeeper (you can use your Accountant but this will be costly) The cost will be far outweighed by the BENEFITS. Second. Those records need to be UP TO DATE so that information is available which relates at the very least to the last month of trading. Not always easy but it is essential if you want to be able to make good business decisions and make changes quickly if some part of your business starts to fail – you don’t know what you don’t know! Once a year is definitely not acceptable! Thirdly – using the numbers which can automatically come off ALL proprietary systems will ultimately steer your business in just some of these ways:
Alongside all the financial numbers above it is just as important to record all your sales and marketing numbers to ensure you are able to easily identify your best performing products / services, your win (and lose) rate, your best performing types of marketing (is it direct sales, sales through social media, online sales etc), your best performing sales people / departments – all of these need to be recorded and compared against KPI’s. KPI’s are important because they are the best indicator of how your business is performing against your strategy / forecast for your business and if you do not know what is or is not performing you will be working blindly, and could be putting vast amounts of effort into the wrong products / services / type of marketing / people (who cost a lot of money) etc. This shows just how useful all those annoying numbers are and why they are so IMPORTANT for every business – they are in fact your BUSINESS SUPERSTARS!
1 Comment
18/8/2021 09:47:47 am
I admire your unique way of writing especially the style of using the idioms and phrases which is mind-blowing. I hope you will not mind if I adopt this style of your. Many thanks.
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