Mistake #7 By Small Business Owners is focusing on “Cash In Bank” Instead of Cash Flow.
I’m glad I get to see behind the curtain of small and mid-sized businesses.
I’m so proud of what you’re creating and the difference you make in the world.
And SO often I want to reach out, clap you on the back, and THEN shake you.
A few months ago my client Farrah asked me for a QuickBooks resource. Seems like a normal question, right?
She couldn’t get the kinds of reports she wanted in the middle of the week to make management decisions.
Now, most of the business owners who come to me want a company that they COULD take to market and sell if the various factors of timing and price are a match with their goals.
But here is what was going on behind the curtain at Farrah’s 8 million dollar a year company.
She was paying for her accountants to get her reports. At the end of each month they would go into each of her bank accounts and credit card statements and produce reports. She had never had a bookkeeper or accounting department. EVER.
She had outsourced HR and payroll. She had a logistics team. She hired and managed and delivered great customer service. But, she ran her business by looking in the bank and seeing if there was cash there. That’s it.
And she came to me because she wants to sell. But guess what? It doesn’t matter what a broker offers her, she does NOT have a sellable business. No contracts. No historical record of what the true expenses and profits are in the business.
She is not alone in this. I suspect that at least 30% of small businesses are doing exactly the same thing. And that’s fine if you plan to be the sole owner of your business. FOREVER.
But Farrah wants to be able to sell.
Her key mistake is in not separating herself from the business and asking “What needs to be in place” for her company to be a credible, self-sustaining business. A huge part of proving that is through the financial management and reporting activities in the business.
We solved that for her by getting an outside team in to rebuild her most recent past year’s books and set up accounting and get disciplined financial management started in her business.
I’m go glad she raised the question so that we could get that massive mistake solved for her business in a way that is going to increase her CONTROL, the company’s VALUE, and her FUTURE FREEDOM measurably within months.
I think too many business owners have had a hang up about money for way too long. It’s okay to make a difference, have great service, product great products. Is it going to be free? Of course not. Profitable? Hmmm, I sure hope so. But understanding money? Too many say “I’ll get around to that eventually” and I say that’s bullxxxx. You’re here to make a difference in the world, fine. You’re not a non-profit. You’re here to make a PROFIT. The two go hand-in-hand.
If you’re ready create a business that you’re not stuck in, you can learn more at OnDay91.com and book time to talk with me privately about what is going on in your business.
If you’d like to join other business owners in my online program you’ll find details at OnDay19.com/momentum
We’ll talk soon
P.S. Whenever you’re ready… here are 4 ways we can help you stabilize and grow your business:
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4. Work with Linda and her team privately
If you’d like to work directly with Linda and the On Day 91 team to take you and your business to it’s next level… just send Linda a message and with the word “Private”… tell her a little about your business and what you’d like to work on together, and we’ll get you all the details! — Click Here