Sound familiar

I don't know if I'm making money

The bank balance goes up and down, the accounts arrive once a year, and in between it is guesswork. Being profitable and feeling in control turn out to be two different things.

The diagnosis

What this usually means.

Almost nobody who says this is actually losing money. What they mean is that they have no way of knowing, and the uncertainty is exhausting.

The bank balance is the instrument most owner-managers end up using, and it is a poor one. It moves with VAT quarters, with the timing of supplier payments, with a single large invoice landing early or late. A healthy month and an unhealthy month can look identical in the bank, and a business can feel comfortable in the same quarter its margin collapses.

Underneath it is usually a measurement problem rather than a trading problem. Revenue is visible because it arrives. Cost of sale is spread across several accounts. Overheads creep. Nobody has separated the jobs, products or clients that make money from the ones that consume it, so the average hides both.

The answer

What we would actually do.

Start with getting the bookkeeping current, because nothing else works without it. Then separate the numbers that answer the question from the ones that do not: gross margin, and gross margin broken down the way your business actually works — by job, by product, by client.

For most businesses that is a monthly management pack. For some it is a live dashboard built from the ledger, refreshed rather than rebuilt, so the answer is there whenever you want it rather than three weeks after month end.

Either way the goal is the same: you should be able to answer this question in about ten seconds, and you should not have to ask us.

Half an hour, no charge, no obligation.

Tell us what is going on and we will tell you what we would do about it. If the answer is that you should stay where you are, we will say that too.