In the Winter 2012 issue of The Professional Quilter, Sue Tucker, Chief Financial Officer of Studio 180 Design and our financial columnist, wrote about seven resolutions you won’t want to break. One of them was “Look at Your Financial Numbers on a Monthly Basis.” Now that we are at the end of month two, how are you doing on this resolution? I know that lots of creative types just aren’t that interested in numbers. And, that’s great if you’ve got someone to input your data, but you still need to look at the numbers on a regular basis. Here’s an excerpt of the Winter issue with Sue’s article on this resolution:

How do you know if you’re making money and reaching your goals? How do you know if you need to change an approach that’s not working or cut back on expenses to make up for a shortfall in revenue? If you aren’t looking at your financial numbers on a monthly basis, you don’t. Some people look at their bank balance when the statement comes, and if there’s money there they think they’re OK. But let’s say they’ve started a slow slide. How many months will it take for that slow slide to wipe out everything in their account, at which point they’ll realize they aren’t OK? If they’d been looking at monthly numbers they would have seen the problem right at the start and been able to take action before their bank account ran out of money.

If you don’t know how you’re doing month-to-month, you can’t be making the right decisions as quickly as you should be to keep your business strong and growing. At the least you should be looking at your revenue and expenses for the month and year-to-date. That will tell you if you are making money. But in addition, many of you should be looking at month-to-month changes, annual growth, receivables and your balance sheet. Your accountant can help you identify what you should be looking at based on your business situation and help you plan the best way to get the numbers you need.

Please share how you’re doing with tracking your financials below.

This entry was posted on Wednesday, February 29th, 2012 at 1:55 pm and is filed under Business, Finance, Goals, Planning, Uncategorized. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.