This may seem an odd question, but many SME business owners are so busy they often don’t know. Far too many rely on being close to the business, their intuition, gut-feel etc.
Ask yourself:
- Do you have up to date and accurate accounting and management information?
- Do you know what year to date profits you’ve made?
- If you have several product/service lines, do you know which are most profitable and why?
- You may be making a profit, but are you turning this into cash quickly?
- Do you know your sales break-even point?
- Do you set a straight-forward budget to focus your thinking?
- Have you identified and are you tracking the right key performance indicators?
- Do you understand the power of compounding, when it comes to increasing net profit and cash?
If the answer to several of the above questions is no, you’re at risk of being a ‘busy fool’. We all know that to be successful in the long term, SME businesses need to keep a good handle on their trading and financial performance, particularly in times of change. History shows that those businesses which fail to understand their finances are more at risk of failure.
If you run an SME business and you haven’t done so already, it might be time to invest in stronger financial controls and management reporting.
Better data => Better analysis => Better decisions => Better business => Better life
If you need help with business accountancy and financial reporting, get in touch for a no-obligation, free discussion – see our Contact Us page for how to reach us.
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Information in this publication is intended to provide only a general outline of the subjects covered. It should neither be regarded as comprehensive nor sufficient for making decisions, nor should it be used in place of professional advice. Whyatt Accountancy and the writer accept no responsibility for any loss arising from any action taken or not taken by anyone using this material.