How to manage the numbers, easily and effortlessly
One of the challenges which I faced back in the days when I was running my B&B as a hobby, and not a proper business, was the books and the numbers.
Being a complete dunce when it comes to maths, I knew that I would get confused, but I still didn’t do anything about it. Instead I just ignored it and hoped it would all just go quietly away. But of course, it didn’t, and everytime I thought about it, I got a sinking feeling in the pit of my stomach.
Ugh! Can you relate to that?
Without having a handle on the numbers, I had no idea whether I was making any profit, covering my overheads, doing better than last year, or anything at all! It was crazy.
So during the “waking up” period of my life, when I realised that my ever-demanding hobby had to start paying for itself, ie: growing up and becoming a real business, I faced this challenge head on.
Here’s what I did:
Spreadsheets, yes I hear you…. There are just four that I’ve found that I really need:
- Occupancy rate: how many nights booked per room
- Weekly bookings taken by channel, ie: online, telephone, email and doorstep, plus those I’ve turned away, just so I know whether demand is growing or not
- Cashflow – weekly and projected
- Revenue and expenses
I record all of this on a weekly, sometimes daily basis as things change quickly in this business, and then I give all of that to my accountant at the end of the month, and she sorts out how much tax I need to pay, what I write off etc.
I try to keep it simple. What do you do?
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