Business financials can be a vulnerable thing to look at. Numbers don’t lie, right?
I have a very creative business, and when I think about numbers, I can get overwhelmed super quickly. Math has just never been a strength of mine so bookkeeping, financials and reporting have always scared me.
When I was about 4 years into my business, I was about to give up. I felt like I was on a treadmill. Always going, going, going but not actually getting anywhere. I was struggling to pay my bills, eating ramen and pb&j. I was seriously considering going back to a full-time job.
If you want to hear more about my financial journey after 14 years in business, click here to listen to my interview on the Creatives Do Money podcast from Plum Tree Money.
I hired a friend of mine to do a deep dive into my financials. I had a solid bookkeeping system and kept my financials pretty clean and up to date, but I NEVER looked at them. I was scared.
What was I scared of? That my business financials would show that I …
- wasn’t successful
- needed to do even more
- didn’t have a viable business
- need more than passion to run my business
- wasn’t doing a good job
- was failing
I felt very vulnerable. I had knots in my stomach as she reviewed, ran reports, and called to meet with me again.
What I didn’t expect was that she came into that meeting saying that my business was definitely viable – I just wasn’t running it mindfully!
What I learned through my process with her was that I could use my financial reports to learn things like:
- what services were often sold together so I could create better packages to serve my clients
- how to set goals around how many packages to sell each quarter
- how to set up my offerings to stabilize my income
- how many clients I actually needed to meet my financial goals
- what expense-to-income ratio I needed to target
- that I didn’t have to do my bookkeeping but I did need to have a better relationship with my reporting monthly, quarterly, and yearly!
Now, I have a love affair with my financials. I love looking at my numbers, playing with what needs to shift. Exploring what products might fit together to create new packages. Seeing what people are buying most. I use my financials to benefit me and help me plan rather than dreading them and avoiding them now.
What if you thought about your business financials as a circuit?
You can see the connection your service makes when you are serving the needs your clients have. Your intentions and the value you provide supports that ability to be in service. And, your income reflects the results you’re getting for your clients to close the circuit. When this circuit is whole within your business, each component feeds the next and even creates return business.
What will tracking your business financials do for you?
- Give you the power to grow your business intentionally.
- Allow you to track what’s working and what isn’t currently.
- Give you the power to make quick adjustments if you need to.
Ultimately, staying in tune with your financial bookkeeping can be a huge gift to your business – and your growth! Financial reporting empowers you to set goals and track progress every month.