Howdy all. Random question. Anyone here own or run a small business? I’ve been doing it (PT, still have a full time job) for a couple years now and am curious how much of your time is spent reviewing reports, cashflow, determining profit margins and making projections? Outside of normal bookkeeping (which is not my strong suit), this seems very important to truly understand your profitability, viability and discover potentials for growth, but it seems often neglected. So, like I said, I was just curious if there was anyone out there trying to figure it out like me.
I don’t own but do help run a small business that started out 20 years ago with the owner and one employee and now has 25 employees and 4 locations. I am in charge of the books and do help with planning for future growth. My biggest suggestion would be to look at your profit and loss statement monthly and compare to previous months and years. This can really help you see where your money is coming from and going to and to see trends in sales and expenses. We are able to see when our slow times are or if a particular product or expense is trending up or down. Of course markets can be unpredictable, but this has helped us forecast what direction we should go and has worked well for us. I hope this helps!
I've worked for the man my whole career. So I do know how to manage a budget, but the generating a budget part is a lot different for a small business. Two close family members have successfully run small businesses and/or been self employed most of their careers. I would really like to start my own gig - long story... The biggest thing I have observed from my family members is to have your cost of doing business nailed down tighter than a bull's asshole. I don't know how else to say it? If you don't know your operational costs you have no idea if you are generating revenue or profit. Profit comes after paying yourself too. If I were going to run my own gig I would have to track every penny coming in and going out. Book keeping is not my strong suit either. So I would do it myself until I could afford an office ninja/bookie to do it for me. Unless I was making so much money I could be lazy about it LOL.
