How do you feel about math and numbers? If you’re like a lot of business owners you either don’t like them, don’t understand them, or don’t pay attention as closely as you should. You know you should have a handle on all of this but can’t find the motivation to get any further.
Lots of business owners have some form of math anxiety. Couple that with an aversion to accounting and you’ve got a real problem on your hands.
But here’s the raw truth: your business runs by numbers and if you don’t know how to read them you are flying blind. It’s time for you to step up and make the decision to get the training and knowledge you need to make that happen. You need to understand what the numbers mean and what the relationships between them. You don’t need to love it, you just need to be competent. And you need to do it now!
You already know that numbers will tell you if you’re making a profit or not. But numbers will also tell you whether you can afford to buy a new piece of equipment or hire someone. They’ll tell you how your marketing campaign is contributing (or not) to your bottom line. How good your sales are. Whether your costs are increasing, etc.
You can’t sit around and wait for your bookkeeper or your accountant to bring you up to speed on these things. It’s your responsibility. You need to dive into your financial statements and bring these things to light yourself. So how do you do that?
First, decide that it’s worth your time and attention and that it’s a priority. Really, isn’t it more than time for you to know this stuff? Consider all the decisions you’re making now based on guesses and hunches, and then imagine making those same decisions based on hard facts. What might you do differently? I’ll bet probably plenty.
Second, look around for educational opportunities. Community colleges have accounting, bookkeeping, and other types of financial courses. There are free online sources like educational websites. Hit your public library and check out one of their books on any of these subject areas. They have lots of titles; find one that’s written so you can understand it. Google a term like “cash flow” and then go to a site that looks to have lots of definitions. Look up the concept on Wikipedia. Ask people you know who are good at this and see if you can’t get a little tutoring.
Keep working on this a little at a time. You’ll be amazed at how even a small increase in your understanding in this area will transform your thinking as a business owner. Your business will thank you.