In the last round-up, I included a post around the process that we’ve used for years to plan for the next twelve months. Little did I know that it would prompt quite so many questions around the most important business numbers!
The post suggested that if you know where you want to get to, and where you are now, you can interrogate your existing numbers to work out how to get from one to the other.
For example, if your goal requires you to make an extra £10,000 in profits next year, you need to know where to put your focus to make that happen. And this is where the questions came from!
- You need to know which of your products or services brings you the most profit.
- Or you need to know where you have the capacity to increase sales, either in terms of equipment or staff.
- You may need to have access to finance to support the purchase of additional supplies, but to know that you need a handle on your cash position, and to know whether you have a buffer should you need one.
There are rafts of other numbers that will help you get a good grip of your plans for the year. The key point to understand is that you may well need to know and work on numbers that are specific to your business.
If you’re unsure of how to find those numbers in your business, you are NOT alone!
There are a lot of business owners out there who aren’t confident around their numbers.
- They may never have had an explanation of them in a way they can understand.
- They may have been told at school that they’re rubbish at maths and have shied away from them since.
- The business may have just been too busy and grown too quickly for them to get a firm grip on them.
- They’ve lost track since Covid hit and have been in ‘defence mode’ since, without a chance to regain an good awareness.
Whatever the reason, please don’t let your lack of awareness of your numbers stop you from having a clear plan for next year!
If you need some support in working through step 4 of the original post, please get in touch! There are huge benefits to be gained from having a clear plan as we head into next year, so make this the year that you make the most of them.