How do you wrap your head around financials?
On Catapult Your Business, we help business owners one question at a time. In this week’s episode, CEO and Co-Founder Casey Clark is joined by Cultivate Business Advisor Stephanie Magurno to unpack a crucial topic: how to get your head wrapped around financials.
Financials can be daunting, but understanding them is critical to making informed decisions and driving business success. With a background in accounting and years of running her own companies, Stephanie is here to help you navigate your business’s financial landscape.
When it comes to financials, mindset is critical. It’s not just about crunching numbers; it’s about adopting a CFO mindset, where financial data inform every decision.
So why do so many business owners need help with financials? Stephanie breaks it down into two main challenges: lack of understanding and accuracy of data. Many entrepreneurs dive into business fueled by passion without the financial know-how to interpret statements or make informed decisions.
But fear not. Stephanie outlines a practical methodology for mastering financials:
- Start with the Basics: Get a handle on your financial statements, like profit and loss statements and balance sheets.
- Budgeting and Forecasting: Look ahead and create a roadmap for your finances, comparing projections with actuals to stay on track.
- Cost Management: Dive deep into your expenses, identifying areas for optimization and cost-cutting.
- Investment and Funding Decisions: Explore different options for financing your business, whether through debt, equity, or alternative sources.
- ROI Analysis: Evaluate the return on investment for various decisions, considering both financial returns and risk mitigation.
- Performance Metrics and KPIs: Focus on leading indicators to track the health of your business and spot potential issues before they arise.
By following these steps, you can gain control over your financials and make informed decisions that drive your business forward. Remember, financials are not just about taxes or historical reporting—they’re your roadmap to success.
So, if you’re ready to take your business to the next level, it’s time to embrace financial literacy. Tune in to hear the full episode and subscribe so you don’t miss any future episodes of Catapult Your Business.
