Statistics reveal that 40% of small businesses are profitable and the other 60% are not. When you think about your business, which category do you fall in – profitable or not? If you fall in the latter, don’t worry there’s a solution and I’m going to share it with you. But first, let me ask you a few questions:
- Do you know how much revenue you generated last year?
- Do you know how much you spent in your business last year?
- Do you have a written budget and plan that you follow in your business?
If you answered no to any of the questions above, you need to put a profit management system in place. A profit management system is basically a process to manage, monitor and track what’s happening in your business financially each and every month. You may be saying to yourself, “oh no, I don’t like #s!” Trust me, I’ve heard this before. I once had a business owner tell me that the numbers just aren’t sexy. Well, after a thought about it, I realized that “being broke and not making money in your business isn’t sexy”. When you say you don’t like something, it usually means that you don’t understand it so instead you make an excuse to avoid learning more about it.
The activities you avoid, delay and ignore doing in your business will cost you more than the things you are doing. For example, if you’re not following up with the connections you’ve made at networking events and conferences because you’re afraid of being rejected or you believe they’ll call you if they need your services, then you are costing your business.
One of my clients didn’t know how much money she was making in her business but had a goal of generating several thousand dollars in the coming months. You must know where you are now in order to create a plan to achieve the results you desire. With my profit map and system we outlined a plan to close the gap between the income she was making and the income she desired.
If a profitable business is what you desire then you’ll need to create a system to manage your bottomline each and every month. Profits don’t just happen, you must do the work to generate them.