4 Easy Ways To Create That Money Making Mindset In Your Business

You may be wondering why anyone would want to create a CFO mindset when they’re using an accountant and bookkeepers to keep their financial records in place and to file their tax returns. You might rely on your accountant to offer you financial advice, but have you considered how much more profitable you could make your business if you understood that financial information too?

A CFO is a strategic thinker who understands the data and story that the numbers are telling them. The CFO understands the important financial statements and knows how to read them. They understand the importance of creating a budget for a business and how to monitor the progress against the budget each month. And they understand how important cash flow is.

When you are running a small business, chances are you are busy wearing multiple hats, and as easy as it is to depend on someone else’s expertise to take care of your business finances, not understanding your business numbers is doing your business a disservice.

Knowing your business numbers will make your business more profitable. When you know your numbers you understand where to put attention on, what offers to sell more of, where you have money leaks, and so much more.

Here are 4 ways to ease into that CFO mindset that will help you plan for your business finance management goals:

1.    Adopt a financial leadership mindset

The purpose of the finance function is to drive business performance, and that’s what leaders do. Leaders are strategic thinkers, and they can’t stop at everything but money. Money is an integral part of your business and you need to show up for that.

2.    Be a goal setter

Make financial goals such as sales targets and measure your progress against them. If you don’t have financial goals, you won’t have direction, and without direction, you will not have a clear path towards anything.

3.    Be a forward thinker

Finance isn’t just about bean counting, it’s about setting financial targets such as operating at a specific profit margin and ensuring you are indeed operating at that level. It’s not just about seeing what is happening now, it’s about what could be, such as making your operations leaner and more profitable.

4.    See the big picture

It’s important to see the vision of the numbers in your strategic plan and work towards these. You can increase performance, set higher goals, and achieve what you want.

Not every business owner will want to grow their business and achieve greater goals, and that’s ok too. Whether you want to grow your business or are comfortable where it’s at when you know your numbers you can keep more money in your pocket for you.

Profit is what is left over to put back into the business or to pay yourself an additional bonus. Ideally, you set yourself up with an annual salary and what is leftover at the end of the year you can decide to keep in profit or put back into the business to grow the business or to invest.

The bottom line is being involved in the business finances is the best thing you can do for your business. This skill allows you to confidently run your business knowing that you are making the best possible decisions for your business.

By Melissa Houston, Contributor