You read your numbers by looking at three of them every month: what came in, what went out, and what’s left. Most owners find out how the year went in April, from an accountant, after every decision that could have changed it has already been made. Knowing your numbers isn’t about becoming a bookkeeper. It’s about not being surprised, and about charging enough that the numbers are worth reading.
Which numbers actually matter?
Revenue, expenses, profit, and revenue per customer. Bodies down and revenue up is the story a lot of owners are living right now, and you only see it if you count both. Revenue tells you if people are buying. Expenses tell you where the money leaks. Profit tells you if you have a business or an expensive hobby. Revenue per customer tells you whether you’re growing by selling more or by charging more, which changes what you do next. Four numbers, one page, once a month. If you’re reading anything more complicated than that and you’re not a CFO, you’re reading it to feel productive.
Why does profit feel lower than revenue says it should be?
Three usual suspects. Expenses that crept: subscriptions, tools, the thing you signed up for in a webinar. Debt, which eats profit before you see it. And the big one: price. If revenue is fine and you’re still broke, you are charging too little, and no amount of expense-trimming fixes a pricing problem. Know your numbers, limit expenses, avoid debt. That’s the order. Cut the subscriptions this month. Pay down the card. Then raise the rate on your best product, because that’s the only one of the three that grows.
How do I make this a habit instead of a panic?
Pick a day. The tenth of the month, coffee, the three numbers, twenty minutes. Whoever does your books, a person or software, sends you those numbers on that day, on one page. You read them, you write one sentence about what you’ll do differently, and you close the file. That’s it. The owners who know their numbers aren’t better at math. They have a standing appointment with them. And the sentence is the point. A number you look at and don’t act on is a number you’re paying to be sad about.
What if I’m afraid of what I’ll find?
Then you already know something’s wrong, and the number just puts a size on it. A problem with a size is a problem you can work. A problem without one keeps you up at night forever. Sit down with Uncle Pat for a second: nobody in a room full of owners is going to think less of you for a bad quarter. They’ve had one. What they can’t help you with is a number you won’t say out loud. Say the real number. That’s the whole trick.
Questions owners ask
How often should I look at my numbers?
Once a month, same day every month, twenty minutes. More than that is anxiety, less is denial.
Do I need an accountant or a bookkeeper?
Both eventually. A bookkeeper keeps the numbers current. An accountant tells you what they mean and files the taxes. Neither replaces you reading them.
What’s the one number to watch if I only watch one?
Profit. Revenue is a story. Profit is the ending.
This is the fifth of six questions nobody taught you to answer. Owners say their real numbers out loud every Thursday inside the Small Business Owners Community, $19 a month, owners only, and there’s a bookkeeping hotline for the quick question. The show is where I say mine.
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