Business and finances. Finances and business.
Whether you’re just starting to track your revenue and expenses or your executive team is deciding what percentage of a surplus should be reinvested into growth, business and finances will always go together.
Like all our favorite legendary duos, Sonny and Cher, Ross and Rachel, Michael Scott, and Dwight Schrute, business and finances also bring about feelings, expectations, goals, societal pressures, drama? and the personal baggage we all carry.
First, let’s talk about the feelings. And yes, we’re serious. Finances can bring about a lot of feelings and it’s important that you make peace with them. Maybe you feel strength and power. Maybe it’s more of a cold sweat/anxiety mix.
Wherever you land on the feelings spectrum, just know, that’s okay. Whatever they are, they are just feelings – nothing more than what’s happening in your body right now. Recognize them, note them and let them be.
Try one of our favorite exercises: imagine these feelings as clouds passing through the beautiful blue sky of your being. Acknowledge them and let them float through.
Finances are just numbers.
Just figures. An arithmetical value expressed by a symbol. They are not a representation of your personal worth, no matter what they are. They are simply a statement of fact: numbers don’t lie. They are a starting point and only inform you of what to do next.
TIP: We track our steps and crochet the daily temperature colors into a blanket – take note of how you’re feeling every time you sit down to work on your finances. Start to make it a monthly ritual and you can see how it changes over time or with big events plus keep you on top of getting it done
Face the Facts
Once you get your financial feelings sorted, step two is Look.At.The.Data.
We get it: for some people looking at the data is the worst! Right?! Others dive in headfirst with glee. Whatever your feelings, remember your clouds and let them float by.
Focus on your accounts, your sums. Record and track them. You might think you need something fancy but our finance guy loves a good ole’ spreadsheet. Thankfully in this age of technology, there are so many apps that help with this including Quickbooks, Mint, and Airtable.
Search out a financial platform that works for you and use it. Finance is like digital ads in that more is better in terms of data. Just like we know that three-plus months of ads data is better than a week, more financial data will bring to light patterns and trends.
Knowing is power.
Knowing gets you poised for the next step. Which is:
Frame It Up
Gather the numbers and it’s time to organize.
There are so many ways to organize numbers. If you are not sure where to start, we divide our business numbers into “buckets” namely three: cost of goods bucket, cost of labor bucket, and the overhead bucket.
And don’t forget the revenue bucket. Blink those eyes. 😻 We promise this will be better than Fast Eddie’s Econ class. Cost of goods and cost of labor buckets are exactly as described: costs associated with the goods or product you’re selling (materials, goods supplies, wholesale, shipping, etc) in one bucket and the cost of labor (work time like your time, employee/contractor time) in the other.
The overhead bucket covers everything else from a physical workspace, office supplies, and continuing ed, to travel and taxes. And all of us entrepreneurs know what revenue is.
Find Your Answer
When the numbers are bucketed, the next thing to do is to assess what the buckets are telling you.
Haha! Assessing is looking at the numbers and asking:
does the equation work?
Does the revenue minus cost of goods minus cost of labor minus overhead provide a profit with which to create a sustainable business? Is it going to make you enough money to make the effort worth it?
Will you reach your financial and overall life goals?
Yes, we know, money isn’t everything. But women especially have been sold a faulty narrative which is the belief that good, kind, “lady-like” women don’t work with money as the goal. It’s bullshit ‼️.
We don’t know of any grocery stores or doctors’ offices or shoe stores for that matter that accept “Wow! I love your work!” or “You are so smart!” as currency. To scrape by is not what we want for you. To be alive costs money and you deserve a liveable wage.
As a group, women chronically undervalue and undercharge for their work and that wage gap is significantly higher for Black and minority women. Maybe it’s not that we set out to get paid less than our male counterparts but oftentimes, we accept less than we deserve whether out of fear 🖐 or scarcity mentality 🖐
Figure It Out
So does the equation work?
Analyzing the results is the best way to find out where to optimize and squeeze the most out of your cash and cut excess. You don’t have to dive into everything all at once. Take a breath and pick two buckets to start. Sample questions to ask yourself:
Is this the best price?
Is this item worth the cost?
Is the time/output level make sense?
When you know your financial goals – what are you specifically working towards -, “figuring it out” is easier.
The most important thing for any business is money. In order to survive, businesses need funds to pay salaries and cover the costs of keeping up with technology and advertising, to name a few. But women can do anything. They might have to work harder to prove themselves depending on the work environment (okay, most work environments) but taking charge of their money through these simple steps is key.