Monday morning tip time.
It’s probably not a tip, as such, but just a little bit of education.
This one is all around PROFIT & LOSS statements. For those who probably don’t really know a lot about profit and loss statements, I’m going to give it a bit of an analogy – Its like a school report card.
So, you have a kid that attends school. After the first term they get sent home with the report card and you don’t really look at it. And then the next term comes along and you might look at it. However, the kid throughout the year has been telling you they are really doing really well at school. And makes comments like…. “I’m happy, the teachers are happy with me.”
But you haven’t been looking at the report card until 6 or 12 months down the line and when you take a closer look and you see that you that little Johnny, or little Jenny is failing, misbehaving or doesn’t pay attention in class. All of these things you could have dealt with had you have had this information sooner.
A profit loss statement is a little bit like that. You can have them printed out every quarter or even every month. But if you don’t look at them and analyse them, it’s pointless.
So my tip is to get these profit and loss statements printed out every month, at the very, very least, every quarter. Then sit with your accountant or sit with your bookkeeper and review these profit and loss statements. Then you will have an indication of how your business is traveling, how it’s performing, whether it’s been “naughty and misbehaving” or even it may show you how amazing its performing
You might say, wow, look, my income in this area is really, really strong, so well done there. There might be some other income streams that you have that aren’t really performing. So you may need to “up your game” a little bit.
It also tells you where you may be overspending or where you’re not spending enough. So there’s lots of these things this profit and loss statement can shed a light on.
So my little tip – Print these out. Analyse them. Don’t just print them out and ignore them. Look at them with somebody who can help you pull them apart a little bit more. And that’s where you can make some real improvements in your business.
If you don’t have anybody that can print these out for you, or you don’t know how or where to find them in your software package, I urge you to give us a call or contact me through Instagram here, through my website or email.
And I would be more than happy to set you in the right direction because it’s really, really important. And, there is power in knowledge. We want to have you SET UP FOR SUCCESS, always.
Have a great day.