Episode Transcript

Michael Abernathy 0:10
What’s up everybody? What’s up? What’s up? What’s up? welcome back to THE a.m guys, welcome back to five minute rants. I’ve still got special guest here, Joseph Powell to wrap up a three part series. We did put bonus content out there to finish out the last episode, but you’ll have to find it on social. Anyways. What’s up Joseph?

Joseph Powell 0:28
I’m very much excited to do number three.

Michael Abernathy 0:30
Awesome, man. Well, episode number three guys is going to be talking about the real numbers. Joseph, can you talk about real numbers to us? And why they’re important?

Joseph Powell 0:43
Yeah, real numbers to me are pretty simple. Are your books accurate? Are things properly accounted for? Do you capture everything that happens? And do you reconcile your books every month? It’s pretty simple concept. But most small business owners don’t.

Michael Abernathy 1:07
I was one of them. It’s true. It’s true. That for whatever reason, me other small business owners just don’t want to look at the books. Don’t want to do the numbers. I don’t know. It’s just one of the things like even a lot of people I’ve talked to starting, they don’t want to do bookkeeping. Really and do this too. Can you talk about why the bookkeeping is really important, Joseph?

Joseph Powell 1:34
Yeah, I mean, think about your personal finances. If you were just out, swiping your debit card, going to the mall, buying whatever you needed, and you never looked at your bank statements? How are you going to know where your money’s going? How are you going to know how much money you still have? How are you going to make a plan to make the best use of your resources? You can’t because you don’t know. So that’s basically where it starts. It’s just knowing What do you have. And as a business owner put in every dollar that you have to work for you. That’s the basics.

Michael Abernathy 2:16
That’s so true. That’s so true. It’s like getting a checkup at the doctor, you don’t know What your blood pressure is, you don’t you don’t know What the health is of the company. You don’t know any of those things. If you actually don’t just do the work to keep it up. Something that I’ve talked about a lot is you should be looking at the numbers once a week. Like seriously, you should be looking at all your numbers once a week just to keep a pulse on the company. What do you think about that? What is your opinion about that?

Joseph Powell 2:43
I agree. You know when most business owners look at their books?

Michael Abernathy 2:50
I don’t. All I know is What I did. And I’ve got a Harvard degreen in stupidity. So it was like at the end of the year, when we first started,

Joseph Powell 2:56
They look at tax time. And then their question for their tax accountant is, oh, I owe $20,000. How is this possible? Yeah, the your books are not for your taxes. Taxes are important. Don’t get me wrong, they’re big expense for for business owners. But your books are there to help you operate your business and make smarter business decisions. So I agree, you should look every every week.

Michael Abernathy 3:23
hold on Hold on. Wait, you hear that guys? This is a professional, someone who is more highly educated than me in this area telling you to look every week. Can you say that again Joseph?

Joseph Powell 3:35
You should look at your books every week. You know, it doesn’t have to be some elaborate analysis you can just you go in there and spend 30 minutes and and see What you have coming up and What you’ve been spending money on and who owes you money and who do you need to call and say hey, you’re 60 days late on this invoice. And then every month you know you should you should have a reconciliation process. And when I say you I don’t necessarily mean you the business owner a lot of times as a business owner, your time is better spent doing What you do and that’s out getting new customers or managing your employees or you know, looking at acquisitions or What have you. You know, bookkeeping is one of those things that you know, you pay a little bit of money every month and have somebody do it and then you can come come check and have accurate, accurate books.

Michael Abernathy 4:34
That makes so much sense. What are some of the most important numbers do you think to look at by the way for a weekly basis?

Joseph Powell 4:41
Receivables if you have receivables I think receivables are big. You know we talked the first episode about cash flow I can’t talk enough about how important cash flow is. If you have like a lot of people do like a 13 week rolling cash flow forecasts which I like that should be updated and obviously every week who owes you and where’s your money gone I would say

Michael Abernathy 5:09
Cool. Well, guys, that’s it. Joseph. Thanks for coming, man. I appreciate you being on.

Joseph Powell 5:15
Thanks for having me. I’ve enjoyed this.

Michael Abernathy 5:17
You’re welcome. Thanks for taking time out of your day, man. And everybody. Thanks for tuning in. And we’ll catch y’all later. Peace.