The 7 Top Excuses of Unprofitable Businesses

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In our last blog we mentioned the remarkable fact that 80% of business owners don’t have a grasp of the numbers that underpin and propel their business forward, and that as a result many were nowhere near as profitable as they should be. In this blog we are going to take a look at the 7 most commonly heard excuses business owners tell me when we are looking to drive more profit out of their business.

Excuse 1       I’m not a number person

Many of us picked up this notion at school or from a relative who has allowed you to decide at some point in life that numbers just weren’t your thing. But the truth is very few people are born with the innate talent for numbers that you often hear about, for all but the very few their comfort around numbers has been built up by practice and confidence. A bit like riding a bike.

Excuse 2       I hate numbers

I want you to ask yourself if this is really true. Do you hate numbers or are you in fact just a little scared or intimidated by them? From experience, the level of emotion that comes with the word hate is often masking a fear of failure. As numbers can’t hurt you, the fear is in many ways irrational. The key here is to dispel the fear by doing, and in the doing you build familiarity.

Excuse 3       I don’t understand numbers

If this is holding you back, then great news. Numbers can’t think for themselves. It requires us to make them do what we want and that the numbers always obey the rules. 1+1 will always equal 2; 2+2 will ALWAYS equal 4 and so on, so the trick here is to learn the rules that numbers must live by. I’m not saying it’ll be easy, much like learning to ride your bike, you might skin your knees a few times, but once you learn how to use your numbers, well you know what they say about riding a bike :)

Excuse 4       Numbers are boring

Ok, I’ll give you this one, I love numbers, they get me out of bed in the morning, but to many they are dull or tedious. But if I was to tell you that those numbers are directly linked to the profitability of your business and to your ability to carve out the life you want for you, your family and your employees it could change your perspective on them. Perhaps think of them as a necessary evil, but one that can propel your company to new levels of profit. A little like visiting the gym is about taking a long term view on your health, or sitting professional exams is a long term investment in your career, learning the numbers is a fantastic investment in the future profitability of your business and in your future lifestyle.

Excuse 5       My accountant takes care of that

This one’s a beauty and if I had a penny for every time I’d heard it… Is your accountant really taking care of them or are you just abdicating responsibility to a 3rd party so you have someone to blame if it all goes wrong. Be honest. Typically accountants focus only on historical information to prepare tax returns, statutory account and all of the other stuff. They may advise you when they spot a problem, or they may just return the figures to you. Most accountants will have a portfolio of accounts they service, and many of the rudimentary tasks on your account may well be handed to a junior member of staff or even outsourced completely. I’m not knocking my profession; these are just the realities of running a successful practice in challenging times. So, given that set of contingencies, wouldn’t it be a better idea to get an understanding of your own numbers and be able to discuss them peer to peer with your accountant.

Excuse 6       I’m just too busy with other things

If you’re a business owner, the chances are you’re busy. It comes with the territory, but dozens of times a day we all make decisions about how to spend our time. Your numbers are the very lifeblood of your business and at some point during the day a decision will come that will allow you to prioritise the numbers in the way that they deserve. Sales call versus the numbers; client meeting versus the numbers; proposal submission versus the numbers; they probably all take precedence but… Popping home for lunch versus the numbers; catching the match versus the numbers; playing a round of golf versus the numbers; hitting the snooze button versus the numbers. Somewhere in your week is the time and space to get your head around what’s really going on inside your business.

Excuse 7       I’m overwhelmed and don’t know where to start

If you recognise this is where you are, then great, you at least know what the problem is. Now I’m in no way underestimating the task ahead, but I do now that it’s just a matter of putting one foot in front of the other and starting the journey. There’s a well hackneyed proverb about a journey of a thousand miles starting with a single step, but somehow it seems very apt here. The key is to start where you feel most comfortable and take it at your own pace. Remember there is a lot of help, advice and training available to you, both free of charge and at a cost. Maybe a resource or a friend to support you through the first few steps would be useful, better still a mentor who can support you fully through the process.

My final thoughts

It’s time for some honest self-reflection. Are you really in control of the numbers in your business and if not, why not? As we hopefully continue this journey together over the coming weeks and months I’m going to help you turn those excuses into real information that will help you make your business more profitable.

Until next time

To your profitable success,

Kelly

If you want to work on the profitability of your business now, you are welcome to click through to our completely free Profit Health Check Tool that will allow you to take the first few steps to a more profitable business today.

 

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Kelly is a qualified accountant with over 12 years’ experience interacting and working with 100s of small business owners. He has a real awareness of some of the struggles that many face when it comes managing the finance side of their business which he has alluded to in his best-selling book Profit Rocket. He is passionate about helping small business owners to make more profit in less time with less stress.