The Numbers That Count: A Deeper Dive into Your Business
In the ever-evolving economic landscape, understanding your business’s finances is not only beneficial, it is crucial. As we navigate these recessionary times, comprehending ‘the numbers that count’ is vital. The question for many business owners is, “What are these numbers in my business, and why do they matter?”
Russell Eastwood, the director of Eastwood & Co, offers his expertise on this very subject. With over 20 years experience coaching and training business leaders across New Zealand, Russell knows a thing or two about what it takes to run a successful business.
According to Russell, ‘the numbers that count’ are ‘personal’ to your business, so you as the Business Owner need to identify them, monitor them and understand how to use them to make effective decisions. These numbers represent the lifeblood of your business, dictating its growth, stability, and future potential.
Beyond Monthly Metrics: Adopting ‘The Rolling Twelves’
As a business owner, it’s important to understand the profitability of your business. Profitability isn’t just about revenue; it’s about margin, and understanding the relationship between expense, and profit. This insight allows you to make strategic decisions about pricing, cost-cutting, and growth.
However, assessing these figures on a monthly basis can be misleading. In fact, Russell goes as far as to say that it ‘drives him crazy’ when people consider the previous month’s figures as the ultimate gauge of performance. The reason for this is simple – each month’s results can be skewed by anomalies, whether they’re good or bad.
Russell advocates for a more macro-level view, suggesting the adoption of ‘The Rolling Twelves.’ This strategy involves consistently reviewing the previous 12 months of business, as a total, for example; total revenue for the last twelve months vs total Operating Expenses for the last twelve months. By adopting this practice, you get more accurate picture of your business’s performance and trends, free from the distortions of short-term fluctuations. This longitudinal perspective allows for more accurate forecasting and robust strategic planning.
Ultimately, the numbers themselves are just one side of the story. The real value lies in what you do with this data. The strategies you put in place and the actions you take in response to these insights can make the difference between maintaining the status quo and propelling your business to new heights.
However, navigating the financial complexities of your business can be challenging, especially without guidance or expertise in financial management. This is where Eastwood & Co can help.
Eastwood & Co’s Comprehensive Workshop for Business Success – The Numbers That Count
We offer a transformative workshop that discusses the numbers that count called “Top line vanity, bottom line sanity but cash is king”. This workshop is designed to help business owners identify what’s really going on with their numbers and understand how to monitor them effectively. By the end of the workshop, you will have a clear understanding of your business’s financial health and your cash cost of growth.
Running a successful business goes beyond just making sales. It’s about understanding the numbers that truly count and making informed decisions based on that knowledge. Don’t wait for your business to take a hit before you start paying attention to these vital signs.
Talk to us today about joining The Numbers That Count workshop and discover tools to take control of your business’s financial health. Let’s ensure that your business isn’t just surviving but thriving in today’s challenging economic climate.
Get in touch with us to enquire about our courses and kickstart your journey to financial mastery today.