I did a wee gasp on Monday when I looked at the date. My heartbeat quickened, my eyes opened wide, and a great big grin spread across my face. Why?
Well, the first quarter of 2013 is over! All done! Finis! Isn’t that exciting? No, I am not nuts…I am an entrepreneur, and quarter-end is a time of great excitement for me. Let me tell you why.
Quarter-end is a time to reflect back on how things have truly gone in your business to date. While I recommend looking at your numbers and knowing your income and expenses on a weekly basis, reviewing your profit-loss statements and cash flow statements each quarter allows you to see a trend in terms of how things are unfolding. It’s an entire three months of data from which you can draw some pretty powerful conclusions, the most important of which is, are you making a profit?
I have found that many entrepreneurs like to focus on how much money they bring in (their gross income). This is a big number, so it’s exciting to look at – I like looking at mine, too! But it is negligent to focus solely on gross income. One must look at expenses, too, and determine your net income or profit. Who cares how much you bring into the business if your expenses are so high that you are incurring debt each month? It doesn’t matter if you bring in a million dollars a year. If it costs you a million dollars plus five cents to bring that million dollars in, you’re not profiting and thus you are working at a deficit. And that, my friends, is not the goal of the successful entrepreneur!
The second most important reason to look closely at your quarter-end statements is to determine if you are on track to meet your 2013 revenue or income goals. There are, after all, only 4 quarters in the year. If, after the first one, you are not on a clear trajectory towards your year-end goal, then you need to course-correct!
The great news is that a course-correct after the first quarter of the year is a very simple thing to do when you have the data upon which to base your decisions. Thus the necessity of reviewing those numbers! You can’t afford to stick your head in the sand when it comes to your money. Remember, what you track, you attract! So track your money and you will naturally attract more of it.
If this is all a bit of garbledy-goop to you, I highly recommend you enlist the services of a bookkeeper or accountant to help you get a handle on your money. And if you are lost and confused as to what you should do to course-correct and get on track for 2013, then I highly recommend you call me immediately! This is a 9-11 situation if ever there were one! Applying for a Profitability Planning Session with me may be just the thing to turn 2013 around for you…if you’re ready, that is, to rise up and make the changes so you can BE the change.