When you get the bank reconciliations from your accountant or bookkeeper, how often do you think, “Where has all the money gone??? I know we are working harder than ever! Our sales or services have increased over last quarter, so how can the checking account balance can be the same (or less!) than it was last quarter???”
If this sounds like you, chances are you simply don’t have the type of information you need to really understand, much less optimize, business performance. Said another way, you don’t have the information to judge whether this quarter really is “better” than last—or to ensure that the next quarter (or month or year!) will be better than the last.
If having enough cash in the bank to meet your next payroll is your current standard, you can continue to operate…at least for the short term. But if you are planning for the long-term success of your business, you need pertinent, timely information. Good information can help you understand the things that are going well and the things that can be done better to achieve a higher return on investment, understand which service lines or income streams are driving profit (or loss), understand whether increases in income are proportional to increases in costs, understand what business drivers you should focus on to increase profitability, and many other factors that will make your business more successful.
The problem likely is that you are working with basic data ($s of sales, $s of expense, bank balance, etc.) rather than meaningful financial information. So how does a business owner turn basic data into useful information that supports their day-to-day needs, as well as helps them plan for their future? The short answer is analytics. Analytics helps you understand the performance of your business now, so that you can better plan your future.
Visit our website (www.tbsi.consulting), then give us a call at 866-960-0428, Ext 702, to discuss how we can support your need for useful, meaningful information to grow, groom or get the most out of your business.