It is thrilling to be able to look back at the past year and realize that you learned quite a few things about finances and your business.
I have worked as a consultant for small business owners for the past ten years. When I worked exclusively as an attorney I was fortunate to be able to work with clients all across the country and to help them navigate the tangled webs of regulation and legislation they faced. It was good and rewarding work. When I decided to shift my focus to work with entrepreneurs to help them run their businesses more efficiently, profitably, and happily it was a good thing for my heart. It gives me a great deal of joy to help entrepreneurs go from dreaming about operating successful businesses to actually operating them. During this time I have watched my clients and have taught them many things. Additionally, I have learned a great deal from my clients as well.
Entrepreneurs don’t have to be afraid of the numbers.
Most business owners I encounter are good at what they do. I have clients who are bloggers, solar energy providers, lawyers, writers, consultants, hairstylists, and many other professions. Many of these clients had one thing in common – they were afraid of the numbers. Many of them were unable to understand basic ideas like cash flow, break even point, and accounts receivable. They were afraid of the federal, state, and local tax authorities. In many cases, they did not understand or try to organize their tax returns each year, they simply handed everything over to their accountants and tax preparers. The saddest part was that often, even after the tax returns were prepared, they didn’t understand what they were signing and sending to the tax authorities.
One of the things I do with all my clients is to make sure they get a good understanding of the numbers when it comes to their businesses. I teach clients how to keep track of the numbers as money comes in and as it goes out. I explain best practices for using the money their businesses earn. This means clients learn not to just buy things because they want them but to match purchasing decisions to cash flow and business cycles. I also explain the tax laws and regulations that guide my clients’ businesses. In all these ways I help clients go from being afraid of the numbers to looking at the numbers with confidence and comfort.
Entrepreneurs should never be afraid to learn.
Entrepreneurs who are willing to learn are more successful and happier than entrepreneurs who refuse to learn. One thing that is common in every industry is that technology, regulations and other factors make it necessary to change how one does business. Just as an entrepreneur must keep up with changes in her industry, she must take care to learn things that will help her to be a better business person. This means if you are not good with numbers, you must learn to be more comfortable with the numbers. After all, one of the primary reasons a person goes into business is to make money. Money is measured using numbers. So, if you are not good with numbers, you must take the steps necessary to learn about them and get better with them.
There are many ways to learn about numbers in the business context. An entrepreneur can take a class, read a textbook, read blog articles, or even speak with other entrepreneurs. Business consultants, lawyers, and accountants like myself are willing to explain the numbers and how to use them to clients. It is well worth the fee charged to obtain this information.
Take a moment today to think about numbers and your business. Do you feel comfortable talking about your business’ finances? If yes, excellent. If no, don’t remain in that state. Take time to learn what you need to learn to be able to understand, control, and manage your business’ finances. You will be glad you did.