If we met on an elevator ride, could you tell me in that short amount of time what key numbers you need to know to run your business effectively?
And that’s okay for today but not for the long-term health and prosperity of your business and you.
I, along with my brothers and dad, kind of ran our company without knowing the key numbers too. So, know that there’s no preaching here but rather a desire to share what we learned as we went along. Know that we had always believed if you worked incredibly hard and kept expenses down the money would follow.
The answer is sometimes it did and sometimes it didn’t. What I mean is the accountants would walk into our office in December and say, “You had a great year. Go buy yourself some tools and trucks and pay yourselves a bonus.” We liked that visit very much!
Unfortunately, there were other years when the accountants would walk into our office in December and say, “This year wasn’t so great. So, we need to keep the numbers looking good and preserve cash. This way the bank will be happy as will your other creditors. In other words, I hope you’ve all got money saved up in your personal bank accounts because you’re not going to get paid for the next month.” We HATED that visit…a lot!
Once we learned the value of doing a budget, setting goals in writing and working proactively on our business vs. just reactively, things got better. We actually created a process to follow that helped us gain control of our business vs. our business always being in control of us. We called it the Five Steps to Gain Control.
This is what you too need to engage.