As part of money month we’re covering lots of aspects of dosh in your business and this week its all about income and forecasting your sales.
I’m passionate about women knowing their numbers. Numbers in, numbers out, actual cold hard cash and forecasted sales or income.
Knowing your numbers inside out helps you make better, wiser, more empowered choices for your business, for you and for your future.
Do you know what your income and sales are for this month, or what they are likely to be for the quarter, for this year?
And you may well say, “Yes Anna, of course I do! I track that baby every day and know exactly what’s happening in my business!”
Or you may be scratching your head and wondering what I’m talking about. Isn’t forecasting something to do with that bright yellow circle in the sky?
And if you’re in the second group then let me assure you, you are not alone. I’ve worked with lots of women who really don’t feel comfortable getting to grips with the money aspect of their business and don’t know where to start when it comes to forecasting sales or setting targets.
We don’t like talking about money do we? It’s not very British. Some say it’s vulgar. These are usually the people who have lots of it and don’t need to worry about the bank balance!
And if this is an area of life and business that leaves you feeling a little twitchy then it can be hard to get going and build this habit and structure into your business life.
So, lets take a basic look at what it might mean for you:
- Understanding what sales are in your pipeline will give you a better idea of when the work might be done, the product sold, or the sale made. And that’s a great place to start.
- Knowing what invoices are due to be paid or maybe even overdue can feel a little uncomfortable sometimes. But imagine having all that money in your bank account instead of it being elsewhere. It’d make a positive difference, right?
- Getting a better understanding of seasonal trends and areas in your business where there are peaks or troughs is a brilliant piece of work to do. If you can plot ahead for a 12 month period and know when will be your busy times and when might be the lulls (enforced or of your choice) then fab.
- If you have 6 or 12 months of business behind you then you have valuable information at your fingertips to
- Review your sales and income and identify any seasonal or other trends in sales
- Map out your current income for that period
- Forecast your sales and target income for the next 12 months and build a marketing plan around the seasonal peaks and troughs to ensure you have more consistent months of income as you want
You’re the CEO of your business right?
I don’t care if that’s your actual title…
You run your business, whether that’s little old you on your own, whether you outsource to a VA or blogger or bookkeeper, or if you have small team.
You are the CEO.
And you should act accordingly.
On a Monday morning when I used to sit down with my strategic team I wanted to know what the actual sales were and what the forecast sales were going to be.
If the forecast sales weren’t predicted to hit the sales targets then I wanted to know what the sales teams and the marketing teams were going to be doing to rectify that. Together – not apart!
They had to work together if we were going to be successful.
And then we had the finance manager. They always want to know about the numbers. They’re looking at the income and the expenditure. They’re looking at the cash flow. They want to be confident that the sales manager knows what they’re doing and can bring that cash through the door.
Here’s the truth bomb – you’re the marketing team, you’re the sales team and you’re the finance director. You, as CEO, need to be able to answer all of these questions on a Monday morning rather than running off to the kettle and the biscuit jar and putting those questions in the “too hard” pile!
This is not rocket science.
If I can do it anyone can – and I mean that.
It’s not about Maths and it’s not about Excel (well, it is a little bit but not really)
I was never too good at Maths at school and managed just a D at GCSE. A levels were approached with a somewhat carefree attitude in favour of chip butties and fun with my friends. And I never went to University.
And yet, I ended up leading a Board of experienced strategic managers for a multi million ££ organisation and sitting round a table every Monday morning, working out what action needed to take place in order to obtain the outcome I desired.
And for the past 7 years I’ve successfully run my own business and helped other women do the same, using these principles.
I’ll say it again, if I can run my own business then you can!
And so, let’s move briefly across to the fact that you made the sale, you did the work, you provided the goods. And that income is forecast to come in – but you didn’t get paid yet. So the income you thought you’d have….is still sitting with someone else.
What do you do in your business about chasing that outstanding money that people owe you?
Here’s the thing. If you’re dealing with employed people, they have absolutely no concept of what it’s like not to get paid. That’s the truth. They receive their salary automatically into their bank account – like clockwork, never fails, guaranteed.
So, you have to educate them.
You can do it nicely (and firmly) and it usually works. They won’t understand that maybe it’s not just them that hasn’t paid the invoice but there are 4 other clients just like them that have “forgotten” to pay. And when that all adds up, that’s a mortgage payment or the shopping for the month or the household bills.
Whatever the amount, whatever the timescales, when invoices are overdue it’s essential that you don’t ignore them.
And if it’s another self employed business owner, then you can have a really frank conversation with them, as they’ll understand your position.
Think about terms and conditions, service agreements, retainers, payment up front and maybe using someone else to chase tricky debts. VA’s do this really well as do recovery agencies who will take their cut from the debtor rather than have you pay.
When it comes to money, your money, your income and your business you should be all over it. You are the CEO and it’s essential you can steer your ship the way you want.
This is super close to my heart. Its so important to me that all business women know exactly what money they have coming in, what they have in their accounts, what they will choose to spend it one etc etc.
And if this is unfamiliar territory then come on over and join us in the private Facebook group Build Your Brilliant Business with Anna where I’ll be chatting in more detail on this and many more business subjects every week!
And you can always download the freebie 4 key templates for Stepping into your CEO Shoes which has some helpful principles & pointers for getting you to step up and into those shoes including goals setting, the power of reviewing, the money stuff and nailing your compelling vision. Grab it here.