Most people in business can identify with this image at some point in the life cycle of their business. We all did it! Sitting at home (usually at night) crunching numbers on spreadsheets to see how many sales we might make and how much profit could result from our efforts.
You remember it I’m sure… thinking about how much stuff you can sell and slotting it into spreadsheets… Setting up your business plan. The slight ‘unknown quantity’ often, is the cost of sales and the overheads required to run the business. So you take an informed guess and slot them in too.
Then you get busy making it all happen… pounding the streets or keyboard marketing and selling your wares. You take your eye off the ball when it comes to the financial management side of things… hoping it will all be OK and profit will be the result if you just sell enough.
The issues start to arise when the costs and overheads aren’t covered by your sales and there never seems to be enough profit for your hard work. To add to the headaches, cash flow is tight and constantly an issue. There never seems to be enough cash flow to pay for everything when it’s due and you end up not getting paid, or worse still, having to kick in your own money to keep things afloat, because it’s all too hard to get a business loan!
This might sound a bit extreme, but it’s pretty typical of what occurs in ‘entrepreneur land’.
Why not avert the headaches this year and get yourself some help and a ‘sounding board’ for your business plans. If you’re thinking of expanding your business, downsizing or exiting in the next year or so, it could be worth its weight in gold to spend a little time with a financially minded person. They can help you to see clearly what will be the outcome of business plans to ensure you end up with the result you want… not a bunch more headaches.
