What was last month’s gross revenue? What was last quarter’s total donations? What were your total operating costs for the last year?
If you’re like many small business owners and non-profit leaders, you may have to get back to us on these questions and often you will have to check with your accountant that does your books or who just finished your tax return. The problem with this scenario is that it speaks volumes into the reality of the financial philosophy and management of the organization for which you are responsible.
Taking it one step further, when we ask other questions like, “what is your budgeted gross profit margin for this next year?” or, “what are your projected operating costs for the next month?” we often get silence.
We get it; it’s hard enough to deal with the facts, let alone trying to project things that are so unknowable such as how much people are going to buy or give to your organization in the future. With the volatility in the overall economy, competition, changes in technology, etc. how could we possibly project the future in any meaningful way? This puts owners and managers in a “what’s the use” mentality, and we are here to scream that your organizations life is at stake here, that’s the “use”!
If you are having health issues and/or desire to stay healthy, there are certain things you must measure. For instance, heart rate, calorie intake, calories burned, etc. Any personal trainer will tell you that one training regiment is not sufficient for all body types. The same is true of small organizations. The financial performance and ongoing health isn’t sustainable without some intentionality and that requires measuring and paying attention to certain metrics.
Do you have the following financial statements readily available?
- Income Statement – Shows the sales, cost of goods sold, operating expenses and net income of your organization
- Cash Flow Projection – shows the cash projected to come in and out for the next month, quarter, year
- Balance Sheet – Shows current assets and liabilities and equity of the organization
If you don’t have an organized, consistent and meaningful reporting process to get accurate and timely data to make decisions about your organizations financial health, then give us a call at 207-467-3178 or email us or fill out the form below.