You’re afraid to make a big growth move, for fear it might end in financial disaster.
You’re paralyzed from aggressively driving your company forward because the lack of financial clarity into the business’s current profitability and cash flow.
You desperately want some clarity on your business’ current financial position. The uncertainty of not intimately knowing your numbers is stopping you in your tracks.
Without current and accurate accounting processes and systems in place you’ll struggle to find that clarity and stunt your business growth.
Even though you’re using accounting software like QuickBooks or Xero, the software alone does not solve your issue. Your accounting system has to be managed properly so everything is kept both current and accurate.
The problem of lack of financial clarity is typically the result of one of two accounting challenges many businesses face.
1. The Growth Challenge
This is a good problem to have. It indicates you have successfully grown out of the micro-business stage into a business world that is more complex, with more information required to successfully run the business. Unless this financial information gap is bridged, that growth will be stopped in its tracks.
Your old, simple bookkeeping system, that provided what you needed when you had fewer employees, customers, and vendors will no longer serve you.
The accounting processes and expertise that is demanded has increased exponentially as well. It’s likely that as a business owner you’re already wearing so many hats. You can’t be expected to hire for or manage this new demand.
You didn’t start your business to become a financial wiz.
To ensure growth and sustainability, you must find the capability to track the information you need to manage the business. And the expertise to know how to use this information to improve profits and cash flow.
2. The Personnel Challenge
Like above, your business has grown past the micro-business size. But you thought you had the right accounting personnel in place to meet the challenge. However, you’re finding the financial information is never there when you need it. Or that you can’t trust the accuracy of it when it’s placed in your hands.
There has been turnover with the accounting duties, so any consistency managing the process is lost. The accounting systems and processes are not strong enough to overcome the turnover problem, and you end up with gaps in the information.
It’s extremely difficult to find the expertise and capability you need to staff this position internally.
Even if you find the talent willing to fit inside the small business world, it’s a stretch for your small business to afford the level of expertise you deserve.
The problem of poor accounting processes and systems produces a lack of financial clarity. This is stunting the owner’s confidence and certainty to take the next bold moves to continue to drive the business forward.
Stay tuned. In upcoming blogs we’ll uncover more problems and dive deep into how we can find solutions to help you move your company towards a bigger future.