July 24, 2014- ISSN# 1545-2646
Plugging into the Numbers
A few days ago I was watching a baseball game on TV. While listening to the announcers talk about a particular player’s batting average it occurred to me that business owners should have the same degree of interest in their numbers as professional athletes have in their performance numbers.
If you think about major league sports, everything is tracked – batting average in total, batting average against this or that pitcher, batting average with runners in scoring positions etc. When a players average is down then they talk about getting a person out of a slump by having them get some input from a hitting coach. When the average is up they talk about the consistency at which they execute.
Business is no different. In fact major league sports is “BIG” business and they track the numbers very specifically. They know not only the performance of their players but also the performance of their stadiums. Number in attendance, beverages sold, hot dogs sold, and so on. All of these numbers fit into an overall view of their business and the capability of the business to produce the type and level of profit they are pursuing.
Do you monitor the numbers in your business to this degree? Too many small businesses shy away from getting into the numbers at a detailed level. With today’s technology there is really no reason why you are not using some sort of accounting tool in your business. Business owners or at least their bookkeepers put in their sales and expenses. They then think they are doing their business proud. When the revenue exceeds the expenses then they are all good. When they don’t then someone or something has to be blamed for their situation. Even more painful is that they wait for long periods of time until their accountant gives them financial reports telling them what happened weeks if not months ago.
Getting back to the baseball game, the announcers talked about the percentage of the player going up in that game as a result of a good night at the ball park. The player went 3 for 4. Do you know the direction of your businesses performance on a weekly basis? Do you know the impact of multiple weeks which fall short of your targets?
This week you need to plug into the numbers of your business. Get a better picture of the actual performance of the business in terms of both revenue and expense. Are you forecasting your revenues and how does that compare with the expense forecast?
I realize that many of you are trying to run the business. Sometimes you need to be forced out of working in the business to working on your business. This week would be a good one to start working on your business by getting into the numbers and understanding the ramifications of them on the performance of your business.
Lost in a sea of numbers about your business? Give JKL Associates a call at (313) 527-7945
Questions or comments – email us at partners@jklassociates.com or call our Office at (313) 527-7945
Copyright – JKL Associates 2014
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JKL Associates
18530 Mack Ave #242
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