It’s pretty exciting stuff being in business. You’ve put your work out there and – Yay! –other people like it. They like it enough to buy it. You feel validated, you feel wonderful, talented, even. But, do you feel rich?
Too often, the work is exciting and you’re busy with sales and making your fantastic one of a kind product. Then, things start to take off – more sales and a real sense of success. Only, the underlying business records and supporting systems weren’t developed. Then, somewhere between placing your supply order and paying the Etsy fees, you think “Where’s my money?”
Don’t panic, if you’re there, you can get out. If you’re on your way there, you can change course. It’s not impossible to change but it’s not a fast and easy fix either. If it was, I would’ve made that the headline.
Cash Flow, Cash Flow, Cash Flow
If it wasn’t annoying to you and exhausting to me, I would have written it a hundred times because it’s that important. The first thing to learn to keep track of is your business cash flow. There are a zillion different definitions and some insanely complicated accounting statements but it comes down to money in/money out and is that positive or negative.
You can get a good idea of that by checking your bank balance from month to month. If it’s growing – positive cash flow – good! If it’s shrinking – negative cash flow – bad! Once you’ve got an idea of where you are, we’ll start analyzing that to see where to improve.
Get your last six months (or as many as you can find) bank statements and a piece of paper. Write down the ending balance for each month, in order. Is it getting bigger or smaller?
What did you find and how do you feel about it? Let me know in a note or the comments, I’m looking forward to hearing from you.
Hear the audio version of this post:
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