Every Executive must learn how to do “The Bottom Line Boogie” with the right steps, the right rhythm, and the right timing.
– Annette Galbraith Hamm
The Bottom Line Boogie is the dance every executive must perform – no matter how new or long-standing, large or small the business. Side stepping, slides, twists, 180’s, 360’s, doesn’t matter, the Bottom Line for every company demands that the steps be the right steps, the rhythm matching that of multiple partners, and that the timing be the right timing.
You may have the right goals, the right people working for you, and a clear vision of who you are and what you are doing as a business, but if you fail to do the Bottom Line Boogie, you are facing the possibility of failure
So what is the Bottom Line Boogie exactly?
(As if you didn’t know) It is the dance you do as you balance the left hand side of your spreadsheet with the right side. That is it in a nutshell. It is not rocket science but, it is often daunting because we are often not sure we really want to know the truth about what the plus and minus signs are going to show us. The gut clenching that happens when you think of really delving into the left hand column is the first sign that you need to attend to that left hand column. You ignore your own body signals at your own peril. Truly.
Whatever else you do in your business, you should never allow the left hand side of that spreadsheet to become vague or indistinct. If you do not know almost to the penny what is happening on the expenditure end of your business you will likely find yourself in trouble at some point. At that point, only you and your banker will know if you are going to be able to rebalance the sheet successfully.
The problem at this point is that you are going to have to change old habits under pressure rather than being in control.
A lot of small business owners are running from morning to night just trying to keep the business going. There is little time for anything that doesn’t count. Well, unfortunately, thing is that what often seems as though it doesn’t count is the total at the bottom of the left column – a true accounting of expenses: mileage, office expenses such as paper, new software programs, printer maintenance, printer ink, etc. Other expenses such as car costs, phone and cell phone costs, professional or business association fees, licensing fees, taxes on sales, etc. also need to be closely tracked.
A sense of being in control, a sense that what is currently happening is good, or a sense that everything is ‘moving along’ is what keeps most owners and executives going. Without that sense of control, life can get pretty chaotic and stressful.
The best solution: a good – doable, achievable plan of action.
If you do not keep a close eye on the left hand column, if you are lucky, years later – rather than months later, you may be brought up short on a sudden unexpected expense and find that your bottom line is not as healthy as you thought. The expenses have sucked the right column not just dry but into the vacuum category.
However, the good news is that if you have been operating for a number of years and have enough good will, your bank or credit bureau may well float you a loan or the government small business loans may help you make it through the financial crisis. Many owners and executives of small businesses do not take advantage of these avenues of available funds, simply because they do not like the idea of taking out a loan.
The question is, do you know how to change what you are doing? Do you know what it will take to keep your business going financially and move it back into the black? The answer is often neither easy, nor initially clear.
You are at the limit of your own time and energy expenditure
You have maxed out your business and personal credit cards
You have hit up your friends and family as much as you dare for financial support and…
You don’t want them to know that you are in financial hot water.
If any of what I’ve talked about here sounds vaguely familiar, you might want to rethink your financial strategy and your current business operations. For those of you who are just starting out or who have successfully negotiated the financial whitewater and come out the other side, there is still a need to deal honestly with yourself and your bottom line. You cannot afford to ignore the bottom line.
The best advice: right now? Do the dance. Face it, don’t dodge it! Get the rhythm going, attack the figures, and become familiar with what it takes to not just keep your business afloat but move into the black in a healthy way – for the business and you.
The steps you take as you choose, revise, and monitor your methods of accounting, monitor your revenue stream, keep tight rein on your expenses and expenditures, and the rhythm you keep as you work with your suppliers, customers and employees are vital to your ability to keep going and become a long term, sustainably, financially viable business.
There are two people who will help you get there: your business coach and your accountant. The sooner you employ both, the sooner you will be able to breathe freely with a clear conscience and a healthy bottom line. What happens with your bottom line is determined by your willingness to deal with it. If it frightens you, you have a sure sign you need to head toward it not away from it. Go for it! Do it! Reorganize now! Invest in yourself and your business.