is what I call the syndrome where you and your business for one reason or another are avoiding your bookkeeping, mishandling it or under-utilizing it. This all-too-common illness is not just a problem of the solo entrepreneur.
Here is a list of common patients:
- the math challenged
- the text-book overthinker
- the busy
- the successful
- the not-so-successful
- the little bit of all of the above
Over my entire career, I have worked with a wide variety of successful and not-so-successful companies, ranging in size and industries. I can speak with candor that ignoring the numbers, bookkeeping blindness, comes in many forms and affects a wide array of business people.
I've been afflicted myself many times: not by ignoring my numbers, but my ignoring what my numbers were telling me. See #1 below.
So, don't loose heart. I have some common reasons why we all come down with bookkeeping blindness at one point or another.
1. Bookkeeping = Big Bad Boogie Monster
You are scared to know the truth. You’re spending too much or bringing in too little. Whatever is going on in there, you’re afraid to look. You don’t want to know the bottom line so you’ve let your fear take the reigns.
Take some time to address your fear. Nine times out of ten, for budding entrepreneurs, it’s a fear of failure.
“I’m not bringing in enough money; I’m a failure.”
“I’m overspending; this is never going to work.”
But guess what? You are not a set of numbers and neither is your business. Numbers don’t mean anything. Remember, they are just theoretical representations of quantity. It’s what we do with those numbers that is the important part.
I’ve overspent on my business before, BIG TIME. Do I consider myself a failure? Hell, no. You know why? Because I have realized I was spending money on things for my business, like e-courses (which I haven’t finished) and perfect little day planners (which I never used), and other bullshit, instead of facing my fears and just doing the work.
YOU HAVE ALL THE TOOLS necessary to succeed, so don’t let a set of numbers make you want to bury your head in the sand. Instead, I took a look at what I spent money on and asked, “Was it worth it?” I said no, so now I don’t buy those things. On the other side, I asked if it was worth joining a women’s business group. I answered “Hells yeah” so I invested in the next step in that same program. I know what’s working and what isn’t because I look at my numbers.
2. Perfectionism and Analysis Paralysis
“I need to set up everything just so, then I’ll go in and get all my expenses in order.”
You have been working on a perfect chart of accounts for ages. You have been working on the perfect invoice template for months. Nothing has been entered or recorded anywhere.
You’ve been researching which bookkeeping system to use for months. This led you to question if you’re using the right credit card processor, which led you to question the bank you’re using. That’s right you’ve been sucked into a tornado of too much information.
Just start. Trying to make everything perfect before you even begin is a fool’s errand. There is no perfect, only progress. Even in bookkeeping, you can always go back and fix things. More often than not, there are ways to do bulk changes easily, with the help of your bookkeeper, accountant or even the right software can do the job.
So, that means you should start now. If you haven’t been tracking your revenue or your expenses at all, start somewhere. For bookkeeping software solutions, here’s a quick guide to your options.
If you have a system, but haven’t started using it, schedule an hour a week to enter the information. Remember: you can always fix things. It takes more time (and often more money) to go back and enter transactions later.
Back in my sewing business hey-day, before I switched it to a fabric retailer, I used to get swept away with the perfect method for finishing the waistband on these tiny skirts for babies. I was focusing on getting them to work better. By doing so, I was avoiding making anything at all, only to realize in the end, I did not enjoy making baby clothes. Our drive for perfection can often hide the truth from us.
3. Square peg into a round hole
“I just hate doing it.”
My sewing example leads right into this. If you hate doing something, that doesn’t mean you should force yourself to do it. You don’t deal with your finances because you just flat out don’t care or detest dealing with math and anything related to it. The more you try to understand, the more frustrated you get.
Get someone else to do it. That’s right. You do not have to be all things in your business. Shocker, I know.
For me, it’s dealing with social media. I can deal with numbers and data all day long, but ask me to come up an original Instagram post and I will do anything to avoid it. Yet, in today’s world, there is no avoiding social media. Answer: outsource that shit!!
Similarly, you cannot avoid bookkeeping as a business owner. But it doesn’t have to be a necessary evil, if you are paying someone else to do the parts you don’t like. Now, does it mean you don’t have to pay attention to the findings? No, reread problem #1 and repeat. It’s what we do with the information that helps us succeed.
4. Goal basis
“When I reach ‘x’ in revenue, then I’ll hire someone to help me.”
“When I make this many in sales, I will take a look at how much I spent.”
“I set my price based off what people are willing to pay.”
Don’t rely on outside factors to determine how you run your business. You need to establish systems and standards or else, you will always be run by your business, not running it.
Even if it’s an Excel spreadsheet, having your bookkeeping system in place from early on in the business means you won’t be scrambling to put that in action when you have an expected flurry in new business. Having standards in your pricing based off of how much an item truly costs, instead of what you think people will pay, means you will MAKE MONEY! What?!? I know it’s crazy, but just because you’re passionate about what you do, doesn’t mean you can’t make money too.
It’s all Greek to you. (Hint that’s the word bookkeeping in Greek; don’t ask me how to pronounce it though.) Instead of getting help, or reading an easy book on the subject, (seriously, this book is only 100 pages, in large type), you’ve just assumed that you won’t get it so why even try.
Call in an expert! Bookkeeping is based on a simple concept - record sales and record expenses. Granted, there are a lot of other factors depending on the complexity of your business, but just because you don’t get it, doesn’t mean you can’t find someone to help you learn.
If numbers aren’t your strong suit, all the more reason to outsource the sometimes, I admit it, mind-numbing minutiae that is bookkeeping. (And I even love numbers, but there’s only so many hours a day you can spend looking at reports, before you start seeing things)Even when you’re starting out, paying someone to take a look at your numbers, at least once a year, can save you tons of money in the long run.
Bottom line (accounting pun intended), learn to love your numbers and see them as an powerful tool to help you refine your business and turn a healthy profit.
And if you can’t seem to find a zen money mindset, then say my accountant’s prayer:
God grant me the serenity to accept the taxes that I cannot avoid; The courage to charge what I am worth; And the wisdom to know when to hire a bookkeeping badass.
Would like some more inspiration to get on top of your expenses? Get your free copy of my guide: 15 ways to reduce business expenses.