June 28

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Know Your Numbers

If I asked you how much money you made in your business last month, could you tell me?  What about your expenses last month, do you know what they were?


As the financial year comes to a screaming halt, so does our financial  business year.  Did you make a profit this year?  

These are questions we think we can answer, of course I made a profit, you tell yourself.   But did you really, have to see what the accountant says.  

I was recently walking with a friend and we started speaking about money in our businesses.   I asked her, how much did you make last year, she replied, I’m not exactly sure, the accountant’s got the numbers.    If you had to get your hands on the numbers pretty quickly could you? I asked.  She hesitated and said yeah, I could if I needed them.   

An amazing mentor I had whilst working in the bank, always said to me:  Rhonda Know Your Numbers.  

It was something he consistently drilled into me, know your numbers.    At that time, I knew my numbers, It was almost as if I would be ready and armed, when he fired his bullets.    How many sales this week, what was the average sale price for the week?.   How are you sitting against plan, how does that relate to your forecast numbers.     Well you can get I knew these numbers studied them, because I was ready for that moment when he asked.

How well do you know your numbers, could you fire them off to me if I asked:

  • Whats your plan?
  • How are your sales tracking against your plan?
  • What is your average sale price?
  • What percent of sales income goes to expenses?
  • What profit did your business make last month?

If you have found yourself in business and no one has ever taught you how to work these numbers out.  Perhaps you’re a one man show and you just havn’t put any reporting in place to measure these things.  Its easy to put your head in the sand and just hand over the paper work to the accountant at the end of the year, but trust me when I say this.

If its not measured, It’s not managed.

What gets measured, gets multiplied, so if you are wanting to make more money in your business, start to track your sales and your expenses, review these on a weekly/monthly basis and you will see the bottom line (profit) in your business grow.


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