Five essentials for business success

Are you sick of some guy in a suit and tie throwing business catch phrases at you like chips to a seagull? You need tools but you need them in real terms and real ways, so here they are.

Dollars
Does profit equal cash? Of course not, but why do nearly all small business owners not know why they have cashflow problems? Well, it’s a no-brainer; they have no idea what their financial position is other than their bank balance.

So – data and reports
With cloud accounting, reports are at your fingertips but you have no idea how to get access to them, let alone read them. Understanding the correct way to record your data to produce meaningful reports is imperative. The old saying “rubbish in is rubbish out” is so true. Make sure you spend some time with your advisor setting or cleaning up your file and then run some simple reports and have them explained in simple terms.

A plan
As part of my public practice certificate, I recently had to submit my business plan. I took on the challenge thinking what a waste of time. Well, I can tell you this plan sits on my desk and I refer to it every day. The time spent thinking about where I wanted to be, how was I going to get there and what was required to get there gave me a road map to follow. It does not need to be a well-written book, just some objectives to lead you to your financial goals.

Budget
I often chuckle at the adverts on TV – “My budget saved me”, someone will say. You know what they do: set a budget based on your income, monitor it and stick to it. That is no different to what businesses should be doing. Reasonably estimate your income (in line with your business plan), understand what it’s going to cost to get that amount of income and enter it into your system and monitor it.

Accountability
As humans, we need some sort of accountability to stick to our goals, it’s the same in business. Your advisor should be the guide to assist you in remaining accountable.