It is dull to most and the #1 task that we pass on to third parties to do on our behalf and unfortunately it is also the number one reason that businesses fail.
Yep it is crunching the numbers. We get so caught up in the new product, the colourful logo the exciting aspects in the process of starting a new business that we forget about the foundation, the so called boring stuff,. This includes things like trademarks, patents, setting up the paper work for the ‘back end’ of the business and of course the most boring of all to some (hope our Finance team isn’t reading this) – the accounting.
We justify passing on the numbers to accountants by saying we are too busy running the business so why not pass it onto an expert to do it? I bet you have said or heard: “I am not qualified to do my numbers” and many other excuses to get out of it.
If you are in business and plan to be successful then you need to learn to love your numbers. Once you do, you will find that analysing your numbers is like reading a book on your business – the numbers tell you what is going wrong and what you need to fix and equally what is going right that you should probably to do more of.
Recently I was talking to a business man who closed one of his stores thinking that it was losing money only to find out afterward that he had made a mistake and it was in fact in profit and he was kicking himself thinking that he should have kept the store open. He now knows the value of the foundations for the business and that the foundation is built purely on the numbers.
I find that this is the biggest mistake that small businesses make, they do not take the time to handle every invoice, check that it is correct, input the data and then check the reports to cross check that it is in line with your financial goals. I hear comments like “It is too confusing”, “It is not my thing” or “I have not got time”. All these comments lead to these businesses to be in the 4 out of 5 businesses that fail in the first 5 years (which is the current statistic). Why? Because the health of your business is in your numbers. The strategy of how to adjust quickly when things go wrong is evident in the numbers, and where you need to focus on the business is, you guest it, in the numbers.
If you do not know your numbers, then you are in trouble. If not now, you will be in the future.. And then “Numbers not being your thing” will be the least of your worries.
I cannot tell you how many business I come across who are in trouble that do not do their financials regularly, they think that paying people and doing their BAS is hard and they would rather leave it to the so called experts. Well I give you the tip, the only person you truly cares about your money and the success of your business is you.
Not only would you make more profit by doing your own numbers due to the learnings you would pick up but you also save on expenses. Win win. If you took the time to learn it, you would find that it really does take just minutes to do your BAS when it is due, that it takes seconds to pull reports on your business (at any time you want) and no time at all to pay wages.
I left school at 16 years old and did not have a clue how to do any accounting, but I took the time to learn with a good accounting system. So it does not make a difference what type of education you have as they make it easy for you.
I was thrilled when I heard that MYOB was sponsoring Shark Tank and I am unashamedly suggesting MYOB as a good accounting system that is easy to use, easy to extract information from and will save you time, headaches and potentially your businesses.
We have just on 300 stores at Boost Juice and the majority of them use MYOB as their accounting system.
Take the time to learn it, it is dead easy to use and the information will empower you to make better decisions for the success of your business. Set up the right tools and processes from the start (e.g. MYOB online accounting software). By choosing an online accounting product like MYOB, as your business grows, you can pick other MYOB products to suit your needs.
Remember however that no matter what system you use for your finances make sure that you input the data correctly. At the end of the day – garbage in = garbage out.
So finally my advice is: do your own accounting and once a year get an accountant to review the annual numbers, you will find that you and your business will be better for it.
Numbers are king.