This week at the Thrivetime Show, we have covered a lot about being profitable and staying on top of your accounting. Business Coach Clay talks about the 5 financial super moves that you must perform if you want to remain profitable and stay ahead of your expenses. Often times, we consider “accounting” as looking in the rearview mirror and seeing where our money went. We must look at our finances as a plan and a path. If we don’t measure it and plan it out, we will be wondering where all of our money went at the end of the month. Gino Wickman, the best-selling author of Traction says, “What gets measured gets done.”
“What gets measured gets done.”
– Gino Wickman (Best-Selling Author of Traction)
The first step is to schedule and block out a specific time that you will sit down and review your finances every single week. Choose a time with no distractions around you so that you can be 100% focused on your accounting and reach ultimate productivity. During this time, review your income, your expenses, your profit margin, and how you can save 3% this next month. Talk about this with your business coach
The second step is to find the best place to physically do your accounting. For some people, this may be at a home office, a library, a room at your office, or even in your work truck. Wherever you have to do it, do it at a place with no distractions so that you can stay focused and accurately track and improve your numbers.
The third step is to schedule a time and a place to meet weekly with your bookkeeper. Clay often says as a business coach “You measure what you treasure”. This means you should weekly sit down with your bookkeeper to ensure that all of the numbers and books are accurate and up to date. If you don’t track your sales and your expenses, you will end up drifting further and further away from your goals.
The fourth step is to schedule a monthly time in your calendar to sit down with your accountant. This time is a great time to strategize and plan out the future. Your accountant should provide you with proactive tax advice that will ensure you stay ahead of the IRS every year. You should also keep track, with them, how much money is coming in, coming out, and how you can keep 3 more percent.
The last step is to develop a proforma which allows you to see how much money you make per customer, how many customers you need to reach to simply break even, and exactly how many customers you need to have to reach your company’s financial goals. This is simply a future prediction based on historical metrics.
These five financial moves will dramatically help you to stay on top of your finances so that you constantly know where you are going. Accounting is something you should never fully turn over to another party. You, as the owner, must have some level of involvement every single week, otherwise, your business will begin drifting further and further from the goal.