Love your Business
We all strive to have a business with the following:
• All supplier payments made at the month-end in time
• Growing gross margin, sales and bank balances
• Monthly reporting 7 days after month-end
• Loving going to work on a Monday as its fun with such a great team
• Love Fridays as I only work 4 days a week
We perform business development projects to obtain these points and we're currently working on growing firms whose owners realise that they cannot do it all themselves.
We have changed the way our clients run their business and consequently their lives, freeing up their precious time with a clear exit strategy.
If your accountant is not helping you with the basics, you need to ask yourself if you are with the right accountant. At the very least, you can come to our lunchbite sessions.
If you don't get your business systemised with tight processes; effective management and control, the classic signs that your business is in trouble will soon start appearing:
1. You’re constantly juggling payments
All businesses at one time or another experience short term problems with cashflow but if you are finding that you constantly have to manage who gets paid first then something is probably wrong with your business.
2. There’s more focus on cutting costs rather than growth
Identifying costs which are not generating sufficient value is imperative; cutting of costs wholesale can often make a bad situation worse, especially in difficult trading conditions. Cutting costs will only get you so far; never lose sight that growing your revenues and increasing your margins are far more important to long term success.
3. You are using personal finances to fund the business
It might be paying for materials on a personal credit card, it might be topping up the bank account from your own savings or it might just be a case of not taking a wage from the business. Funding the business from personal sources might be ok to cover a small blip but if it’s a frequent habit then it should be a matter of concern.
4. You’re lacking accurate and timely information
• Do you know how much your business is owed by its clients and how much of that is overdue?
• What is the value of stock held by your business and how much of it is more than six months old?
• Do you know what your monthly break-even point is and how many times have you achieved it in the last 12 months?
Without this vital information, every decision you make is based upon a gut feel. This might work but a decision based upon facts is more likely to be the correct one than a decision based upon guesswork.
5. Has the fun gone out of running your business?
Think back to why you set your business up in the first place. It probably has a lot to do with wanting the freedom and excitement that comes from being in charge of your own destiny. If those reasons no longer exist something is fundamentally wrong and you need to take steps to bring them back.
Do any of these issues sound familiar?
If the answer is yes, then there is a good chance your business has problems that need resolving before it is too late.