WEBVTT
00:00:16.289 --> 00:00:18.480
Hey folks, welcome to my lunch table.
00:00:18.539 --> 00:00:27.269
This is the podcast where small business owners come together to feed their mind, fuel their leadership, and face the day with purpose.
00:00:27.269 --> 00:00:28.949
I'm your host, Simon Hague.
00:00:28.949 --> 00:00:34.619
I'm a business coach, resilience builder, and your partnering progress through this session today.
00:00:35.130 --> 00:00:40.380
So today we're diving into a subject that quite frankly is or should be.
00:00:40.994 --> 00:00:45.854
Front of mind for any small business owners, and this is about money, money and finance.
00:00:46.244 --> 00:00:58.335
We're not gonna be thinking about it in a slick spreadsheets and stock charts type of way, but I'm gonna be talking about some messy month to month reality that so many of us are living through.
00:00:58.994 --> 00:01:06.885
So here's the stat I want to kick off with though, and this is the thing that's inspired the podcast today according to the status of small business.
00:01:07.230 --> 00:01:18.390
Britain 2024 report over half of SMEs, that small, medium sized enterprises expect their reserves to last less than six months.
00:01:19.469 --> 00:01:21.239
So let's let that sink in.
00:01:22.349 --> 00:01:33.959
That means that most small businesses across the UK are just two bad quarters away from serious financial stress or even failure.
00:01:35.189 --> 00:01:38.099
Now if that panic hits close to home, I want you to know this.
00:01:38.099 --> 00:01:44.069
You're not alone, and there is a way outta panic into planning and greater confidence.
00:01:44.549 --> 00:01:55.200
So in this bite-sized episode, I'll walk you through three practical ways you can boost your financial clarity and start building long-term resilience without needing to become an accountant.
00:01:55.590 --> 00:01:59.039
So think of this very much as your financial reset.
00:02:02.310 --> 00:02:05.159
Think of this as your financial reset.
00:02:05.789 --> 00:02:06.689
So let's begin.
00:02:07.769 --> 00:02:18.990
First things first, we need to understand why cashflow clarity really matters, and what we're talking about today is not gonna be about financial perfection.
00:02:19.050 --> 00:02:20.760
This is about clarity.
00:02:21.360 --> 00:02:24.450
See, cash flow is like the lifeblood of your business.
00:02:24.510 --> 00:02:27.390
It's not just numbers, it's breathing room.
00:02:27.390 --> 00:02:28.560
It's confidence.
00:02:28.770 --> 00:02:35.850
It's the fuel for your next decision, whether that's hiring, investing or simply paying yourself properly.
00:02:36.765 --> 00:02:44.835
When that fuel runs low, when we are not watching income and out go with intention, we do what all stressed humans do.
00:02:44.835 --> 00:02:56.235
We react, we cut back, we delay, we guess, and those quick decisions often make us feel isolated and that isolation can spiral.
00:02:57.195 --> 00:03:03.735
But when we gain clarity, when we understand what's really going on with our cash, we shift from guessing to leading.
00:03:04.844 --> 00:03:13.605
So let me take you through three steps you can take this week to get that clarity and set foundations for the longer term financial health.
00:03:14.835 --> 00:03:19.005
So first is book a Cashflow Health Check with yourself.
00:03:19.005 --> 00:03:27.735
Now, don't worry, this is not going to be a detailed cashflow forecast analysis exercise, which you may do with your accountant quite frequently.
00:03:27.735 --> 00:03:31.245
And if you're not, then I'd suggest you maybe think about that.
00:03:31.605 --> 00:03:34.785
Here's a simple three question checklist that you can do today.
00:03:35.415 --> 00:03:41.025
So the first question is, what's your average monthly outgoing over the past 90 days?
00:03:43.050 --> 00:03:51.780
Second question, how much liquid cash, that's money available in your business bank account, or that you can liquidate quickly, do you have right now?
00:03:52.680 --> 00:03:54.570
And the first third question is straightforward.
00:03:54.570 --> 00:03:59.969
Divide your cash by your average monthly spend, and that's your runway.
00:04:00.480 --> 00:04:00.840
Okay?
00:04:01.320 --> 00:04:04.620
If that number is less than six, then you're not alone.
00:04:04.760 --> 00:04:08.660
You drop into this greater than 50%, but now you know.
00:04:09.469 --> 00:04:13.790
From there, ask, what costs can be trimmed without cutting value?
00:04:14.600 --> 00:04:17.240
Can you renegotiate terms with suppliers?
00:04:17.240 --> 00:04:22.009
Are there any large invoices that you're expecting, which haven't been paid yet?
00:04:22.459 --> 00:04:26.660
Can you accelerate any monies that you're gonna have paid to you?
00:04:27.709 --> 00:04:38.209
As they say, what's measured is managed, so if we can increase that number, then it means that our business is more sustainable in the long term.
00:04:39.560 --> 00:04:43.609
The second model to think about is how you can triple your visibility.
00:04:44.750 --> 00:04:48.620
Financial confidence doesn't come from just knowing your current position.
00:04:49.039 --> 00:04:53.779
It's about building habits which can make panic less likely.
00:04:54.439 --> 00:04:56.719
So here's another suggestion for you.
00:04:57.769 --> 00:05:01.339
Increased visibility with some simple routines.
00:05:01.430 --> 00:05:06.439
So every Monday, spend 10 minutes reviewing last week's income and where the cash went.
00:05:07.279 --> 00:05:14.389
In the midweek forecast, any known payments or income for the week ahead and at the end of the week, plan for the following week.
00:05:14.870 --> 00:05:16.699
What you already know is coming.
00:05:16.729 --> 00:05:18.079
What you already know is coming in.
00:05:19.234 --> 00:05:20.344
And going out.
00:05:20.404 --> 00:05:34.175
You don't need any fancy systems, A spreadsheet will do, but if you prefer tools, apps like Zero or SmartBooks, integrate Brilliant with your bank feeds and give you some really accurate, fast, up-to-date information.
00:05:34.175 --> 00:05:38.914
In fact, just seeing regular graphs and predictions can shift your mindset profoundly.
00:05:40.009 --> 00:05:46.879
The third area is seek external support either from an accountant or from a coach.
00:05:47.419 --> 00:05:52.009
One of the big lessons from the State of Small Business Britain report is this.
00:05:52.399 --> 00:06:03.560
Coaches can play a powerful after underrated role in helping leaders build their financial literacy so they can help plan behaviors and they can help look at long-term resilience.
00:06:04.339 --> 00:06:07.069
And this really cannot be overstated.
00:06:07.819 --> 00:06:10.789
A coach can translate numbers into strategy.
00:06:10.789 --> 00:06:16.069
They can help you stop avoiding those tricky decisions, or worse, ignoring the data altogether.
00:06:16.849 --> 00:06:30.234
I've had a client come to me feeling genuinely ashamed about their financial fog, but this just understanding and going through simple planning exercises helped them to understand where their runway is.
00:06:30.949 --> 00:06:37.310
What business they've got coming in over the next six months and where they need to be focusing their efforts to bring more business in.
00:06:38.839 --> 00:06:51.250
So the third area is really capitalizing on this thing about not asking for help being seen as a weakness because it's one of the most smart business moves that you can take.
00:06:52.120 --> 00:06:55.359
Now the third area is talking about the elephant in the room.
00:06:55.359 --> 00:06:57.069
That money talk feels hard.
00:06:57.459 --> 00:06:59.740
A lot of small business owners feel embarrassed.
00:06:59.769 --> 00:07:04.209
They feel lost or even ashamed about not knowing their numbers inside out.
00:07:04.269 --> 00:07:05.109
Listen, I get it.
00:07:05.109 --> 00:07:05.529
Okay.
00:07:05.829 --> 00:07:14.229
If you ask me what my EBITDA is right now, or if I understood what my profit is on my business right now, I'd have to dip into my systems to get that.
00:07:14.229 --> 00:07:18.550
I don't carry that in my mind, but I, I know where it is in my business.
00:07:19.629 --> 00:07:20.409
So you don't.
00:07:20.919 --> 00:07:25.180
Start your business to stare at balance sheets or profit and loss statements.
00:07:26.349 --> 00:07:34.240
But we need to think that understanding the profitability in our business is a leadership skill.
00:07:34.539 --> 00:07:37.209
Our financial confidence is a leadership skill.
00:07:37.449 --> 00:07:42.759
It's not just about knowing every nitty gritty account code or chart of accounts.
00:07:42.969 --> 00:07:45.579
Our financial clarity is about knowing your runway.
00:07:45.925 --> 00:07:49.404
Owning your decision and being more proactive, not reactive.
00:07:49.404 --> 00:07:57.324
So your team is looking to you for decisions your clients seek stability and your future self.
00:07:58.764 --> 00:08:01.675
Yeah, they'll thank you for building the foundations now.
00:08:01.914 --> 00:08:09.115
So the, the kicker here is you don't need to be a finance whiz, but you do need to feel the ownership of your business's financial health.
00:08:09.115 --> 00:08:11.334
So today's a perfect place to start.
00:08:12.625 --> 00:08:16.555
So let's recap three steps to shift from panic to planning.
00:08:16.615 --> 00:08:19.824
Step one, book a cashflow health check.
00:08:21.144 --> 00:08:23.034
Step two, triple your visibility.
00:08:23.245 --> 00:08:27.354
Step three, get some external support, either from a coach or from an accountant.
00:08:28.224 --> 00:08:33.085
Each of these actions moves you closer to clarity and clarity.
00:08:33.115 --> 00:08:34.675
That fuels confidence, doesn't it?
00:08:36.070 --> 00:08:43.899
So if you want to take this one step further, you can then start thinking about how you're going to utilize the money that's coming into your business.
00:08:44.500 --> 00:08:56.160
And one of the things I, I work with is developed something which Jim Rowan from the 1990s used, which was having pots, which I can put income into when the.
00:08:56.820 --> 00:09:11.520
Income comes into my business, that means I'm building up pots of money for various different projects, thereby reducing the need for credit arrangements later on, should I need to or leveraging credit in the best possible way I can.
00:09:12.389 --> 00:09:14.790
So here's the thing, okay?
00:09:15.540 --> 00:09:16.290
Take action.
00:09:16.290 --> 00:09:20.970
Take ownership on what is happening with your financial leadership of your business.
00:09:21.330 --> 00:09:26.340
And what you'll find is that your financial leadership of your business will then lead your business to a better place.
00:09:26.340 --> 00:09:26.400
I.
00:09:27.075 --> 00:09:44.585
If you want to take a quick cashflow guide download our free financial clarity checklist, you'll find it over at my lunch table.com/podcast/five and enjoy.
00:09:46.190 --> 00:09:48.860
So thank you for joining me around my lunch table today.
00:09:48.860 --> 00:09:50.420
Until next time, lead well.
00:09:50.420 --> 00:09:52.220
Live well and keep going.
00:09:52.639 --> 00:09:54.350
The world is a tough place right now.
00:09:54.350 --> 00:09:54.740
Yeah.
00:09:55.009 --> 00:10:04.009
But if you're doing it with a good understanding of what your financial measures are, you'll be in a best place to conquer what your future self is going to be thanking you for.
00:10:04.680 --> 00:10:06.840
Until next time, stay good.
00:00:16.289 --> 00:00:18.480
Hey folks, welcome to my lunch table.
00:00:18.539 --> 00:00:27.269
This is the podcast where small business owners come together to feed their mind, fuel their leadership, and face the day with purpose.
00:00:27.269 --> 00:00:28.949
I'm your host, Simon Hague.
00:00:28.949 --> 00:00:34.619
I'm a business coach, resilience builder, and your partnering progress through this session today.
00:00:35.130 --> 00:00:40.380
So today we're diving into a subject that quite frankly is or should be.
00:00:40.994 --> 00:00:45.854
Front of mind for any small business owners, and this is about money, money and finance.
00:00:46.244 --> 00:00:58.335
We're not gonna be thinking about it in a slick spreadsheets and stock charts type of way, but I'm gonna be talking about some messy month to month reality that so many of us are living through.
00:00:58.994 --> 00:01:06.885
So here's the stat I want to kick off with though, and this is the thing that's inspired the podcast today according to the status of small business.
00:01:07.230 --> 00:01:18.390
Britain 2024 report over half of SMEs, that small, medium sized enterprises expect their reserves to last less than six months.
00:01:19.469 --> 00:01:21.239
So let's let that sink in.
00:01:22.349 --> 00:01:33.959
That means that most small businesses across the UK are just two bad quarters away from serious financial stress or even failure.
00:01:35.189 --> 00:01:38.099
Now if that panic hits close to home, I want you to know this.
00:01:38.099 --> 00:01:44.069
You're not alone, and there is a way outta panic into planning and greater confidence.
00:01:44.549 --> 00:01:55.200
So in this bite-sized episode, I'll walk you through three practical ways you can boost your financial clarity and start building long-term resilience without needing to become an accountant.
00:01:55.590 --> 00:01:59.039
So think of this very much as your financial reset.
00:02:02.310 --> 00:02:05.159
Think of this as your financial reset.
00:02:05.789 --> 00:02:06.689
So let's begin.
00:02:07.769 --> 00:02:18.990
First things first, we need to understand why cashflow clarity really matters, and what we're talking about today is not gonna be about financial perfection.
00:02:19.050 --> 00:02:20.760
This is about clarity.
00:02:21.360 --> 00:02:24.450
See, cash flow is like the lifeblood of your business.
00:02:24.510 --> 00:02:27.390
It's not just numbers, it's breathing room.
00:02:27.390 --> 00:02:28.560
It's confidence.
00:02:28.770 --> 00:02:35.850
It's the fuel for your next decision, whether that's hiring, investing or simply paying yourself properly.
00:02:36.765 --> 00:02:44.835
When that fuel runs low, when we are not watching income and out go with intention, we do what all stressed humans do.
00:02:44.835 --> 00:02:56.235
We react, we cut back, we delay, we guess, and those quick decisions often make us feel isolated and that isolation can spiral.
00:02:57.195 --> 00:03:03.735
But when we gain clarity, when we understand what's really going on with our cash, we shift from guessing to leading.
00:03:04.844 --> 00:03:13.605
So let me take you through three steps you can take this week to get that clarity and set foundations for the longer term financial health.
00:03:14.835 --> 00:03:19.005
So first is book a Cashflow Health Check with yourself.
00:03:19.005 --> 00:03:27.735
Now, don't worry, this is not going to be a detailed cashflow forecast analysis exercise, which you may do with your accountant quite frequently.
00:03:27.735 --> 00:03:31.245
And if you're not, then I'd suggest you maybe think about that.
00:03:31.605 --> 00:03:34.785
Here's a simple three question checklist that you can do today.
00:03:35.415 --> 00:03:41.025
So the first question is, what's your average monthly outgoing over the past 90 days?
00:03:43.050 --> 00:03:51.780
Second question, how much liquid cash, that's money available in your business bank account, or that you can liquidate quickly, do you have right now?
00:03:52.680 --> 00:03:54.570
And the first third question is straightforward.
00:03:54.570 --> 00:03:59.969
Divide your cash by your average monthly spend, and that's your runway.
00:04:00.480 --> 00:04:00.840
Okay?
00:04:01.320 --> 00:04:04.620
If that number is less than six, then you're not alone.
00:04:04.760 --> 00:04:08.660
You drop into this greater than 50%, but now you know.
00:04:09.469 --> 00:04:13.790
From there, ask, what costs can be trimmed without cutting value?
00:04:14.600 --> 00:04:17.240
Can you renegotiate terms with suppliers?
00:04:17.240 --> 00:04:22.009
Are there any large invoices that you're expecting, which haven't been paid yet?
00:04:22.459 --> 00:04:26.660
Can you accelerate any monies that you're gonna have paid to you?
00:04:27.709 --> 00:04:38.209
As they say, what's measured is managed, so if we can increase that number, then it means that our business is more sustainable in the long term.
00:04:39.560 --> 00:04:43.609
The second model to think about is how you can triple your visibility.
00:04:44.750 --> 00:04:48.620
Financial confidence doesn't come from just knowing your current position.
00:04:49.039 --> 00:04:53.779
It's about building habits which can make panic less likely.
00:04:54.439 --> 00:04:56.719
So here's another suggestion for you.
00:04:57.769 --> 00:05:01.339
Increased visibility with some simple routines.
00:05:01.430 --> 00:05:06.439
So every Monday, spend 10 minutes reviewing last week's income and where the cash went.
00:05:07.279 --> 00:05:14.389
In the midweek forecast, any known payments or income for the week ahead and at the end of the week, plan for the following week.
00:05:14.870 --> 00:05:16.699
What you already know is coming.
00:05:16.729 --> 00:05:18.079
What you already know is coming in.
00:05:19.234 --> 00:05:20.344
And going out.
00:05:20.404 --> 00:05:34.175
You don't need any fancy systems, A spreadsheet will do, but if you prefer tools, apps like Zero or SmartBooks, integrate Brilliant with your bank feeds and give you some really accurate, fast, up-to-date information.
00:05:34.175 --> 00:05:38.914
In fact, just seeing regular graphs and predictions can shift your mindset profoundly.
00:05:40.009 --> 00:05:46.879
The third area is seek external support either from an accountant or from a coach.
00:05:47.419 --> 00:05:52.009
One of the big lessons from the State of Small Business Britain report is this.
00:05:52.399 --> 00:06:03.560
Coaches can play a powerful after underrated role in helping leaders build their financial literacy so they can help plan behaviors and they can help look at long-term resilience.
00:06:04.339 --> 00:06:07.069
And this really cannot be overstated.
00:06:07.819 --> 00:06:10.789
A coach can translate numbers into strategy.
00:06:10.789 --> 00:06:16.069
They can help you stop avoiding those tricky decisions, or worse, ignoring the data altogether.
00:06:16.849 --> 00:06:30.234
I've had a client come to me feeling genuinely ashamed about their financial fog, but this just understanding and going through simple planning exercises helped them to understand where their runway is.
00:06:30.949 --> 00:06:37.310
What business they've got coming in over the next six months and where they need to be focusing their efforts to bring more business in.
00:06:38.839 --> 00:06:51.250
So the third area is really capitalizing on this thing about not asking for help being seen as a weakness because it's one of the most smart business moves that you can take.
00:06:52.120 --> 00:06:55.359
Now the third area is talking about the elephant in the room.
00:06:55.359 --> 00:06:57.069
That money talk feels hard.
00:06:57.459 --> 00:06:59.740
A lot of small business owners feel embarrassed.
00:06:59.769 --> 00:07:04.209
They feel lost or even ashamed about not knowing their numbers inside out.
00:07:04.269 --> 00:07:05.109
Listen, I get it.
00:07:05.109 --> 00:07:05.529
Okay.
00:07:05.829 --> 00:07:14.229
If you ask me what my EBITDA is right now, or if I understood what my profit is on my business right now, I'd have to dip into my systems to get that.
00:07:14.229 --> 00:07:18.550
I don't carry that in my mind, but I, I know where it is in my business.
00:07:19.629 --> 00:07:20.409
So you don't.
00:07:20.919 --> 00:07:25.180
Start your business to stare at balance sheets or profit and loss statements.
00:07:26.349 --> 00:07:34.240
But we need to think that understanding the profitability in our business is a leadership skill.
00:07:34.539 --> 00:07:37.209
Our financial confidence is a leadership skill.
00:07:37.449 --> 00:07:42.759
It's not just about knowing every nitty gritty account code or chart of accounts.
00:07:42.969 --> 00:07:45.579
Our financial clarity is about knowing your runway.
00:07:45.925 --> 00:07:49.404
Owning your decision and being more proactive, not reactive.
00:07:49.404 --> 00:07:57.324
So your team is looking to you for decisions your clients seek stability and your future self.
00:07:58.764 --> 00:08:01.675
Yeah, they'll thank you for building the foundations now.
00:08:01.914 --> 00:08:09.115
So the, the kicker here is you don't need to be a finance whiz, but you do need to feel the ownership of your business's financial health.
00:08:09.115 --> 00:08:11.334
So today's a perfect place to start.
00:08:12.625 --> 00:08:16.555
So let's recap three steps to shift from panic to planning.
00:08:16.615 --> 00:08:19.824
Step one, book a cashflow health check.
00:08:21.144 --> 00:08:23.034
Step two, triple your visibility.
00:08:23.245 --> 00:08:27.354
Step three, get some external support, either from a coach or from an accountant.
00:08:28.224 --> 00:08:33.085
Each of these actions moves you closer to clarity and clarity.
00:08:33.115 --> 00:08:34.675
That fuels confidence, doesn't it?
00:08:36.070 --> 00:08:43.899
So if you want to take this one step further, you can then start thinking about how you're going to utilize the money that's coming into your business.
00:08:44.500 --> 00:08:56.160
And one of the things I, I work with is developed something which Jim Rowan from the 1990s used, which was having pots, which I can put income into when the.
00:08:56.820 --> 00:09:11.520
Income comes into my business, that means I'm building up pots of money for various different projects, thereby reducing the need for credit arrangements later on, should I need to or leveraging credit in the best possible way I can.
00:09:12.389 --> 00:09:14.790
So here's the thing, okay?
00:09:15.540 --> 00:09:16.290
Take action.
00:09:16.290 --> 00:09:20.970
Take ownership on what is happening with your financial leadership of your business.
00:09:21.330 --> 00:09:26.340
And what you'll find is that your financial leadership of your business will then lead your business to a better place.
00:09:26.340 --> 00:09:26.400
I.
00:09:27.075 --> 00:09:44.585
If you want to take a quick cashflow guide download our free financial clarity checklist, you'll find it over at my lunch table.com/podcast/five and enjoy.
00:09:46.190 --> 00:09:48.860
So thank you for joining me around my lunch table today.
00:09:48.860 --> 00:09:50.420
Until next time, lead well.
00:09:50.420 --> 00:09:52.220
Live well and keep going.
00:09:52.639 --> 00:09:54.350
The world is a tough place right now.
00:09:54.350 --> 00:09:54.740
Yeah.
00:09:55.009 --> 00:10:04.009
But if you're doing it with a good understanding of what your financial measures are, you'll be in a best place to conquer what your future self is going to be thanking you for.
00:10:04.680 --> 00:10:06.840
Until next time, stay good.
