You have decided to start your own business. You have opened your doors and are selling products and services. Everything is going well.
There’s one problem: As the business owner, you feel as if you should be bringing in more profit and cash than you are.
You look at your financial statements to try and pinpoint a problem. However, viewing columns and rows of numbers is similar to attempting to read Greek or Latin. Is this you?
Perhaps you somewhat understand the numbers present in your financial statements, but you are not completely sure where those figures derived from and what actions you should consider in order to increase or decrease them. Is this you?
Consider your financial statements the business’s EKG. It can help you identify when your business is healthy and when there could be an underlying problem. It is a vital component of your business’s health, and it is important that as a businessperson, you are able to interpret the results.
Your financial statements can act as tools to make better decisions for your business. They act as a report of the past and can assist in making future decisions.
As business owners or even key managers, it is important that you are able to manage the level of growth that is occurring. You can do this through understanding the business’ financial statements, such as the cash flow. When you understand your cash flow statement, you can forecast, review past trends and effectively control the cash that is flowing through your business. In turn, this will open up an understanding of your income statement and balance sheet.
The counselors at the University of Houston-Victoria’s Small Business Development Center have participated in a financial program titled Profit Mastery. The program teaches how to demystify your finances and use them to your advantage as the business owner or a key manager. The program supports the idea of keeping it simple.
Some of the key topics that the program highlights are:
- How to properly plan.
- The importance of monitoring your company’s financial position on a regular basis.
- Identifying your business’s strengths, weaknesses and opportunities.
- Understanding and managing your business’s break-even point.
- Managing and understanding your cash flow, cash flow trends and cash flow needs.
- Managing growth in your business.
The UHV-SBDC will be facilitating a four-week course beginning in July, which is designed to enhance the financial management skills of all businesspeople: business owners, key managers, lenders, and business advisers, to name a few. Driving financial performance in your business is its Achilles heel and an important factor in achieving success.
For more information regarding the program, please contact the UHV-SBDC at 361-485-4485.