WHAT IS BOOKKEEPING?
People hear the word bookkeeping and think “I don’t like numbers” or “I’m terrible at math.” To which we say, WE WHOLEHEARTEDLY AGREE! We hate math too!
Here’s the thing. Bookkeeping isn’t math. And it’s only partly numbers. It’s really the autobiography of the life of a business. It’s the story of how a new product succeeded. It’s the tales you live to tell when you talk about being a business owner.
So, if you approach and contemplate documenting the BOOK of your business, it feels a lot less overwhelming and a whole lot more enjoyable.
And now, in 2021, there are so many tools and apps to make that storytelling super easy and non-threatening. No more t-accounts and calculus!
Next, let’s consider what a business really is. It’s a way to make money. Right? Let’s be honest with that. It is supposed to bring you money at the end of the day.
So, one very small component is “how much cash do I have?” Have you ever bounced a check? OF COURSE YOU HAVE, AND IT ONLY HAPPENED ONCE, RIGHT? And when that happened you didn’t know how much cash you had.
The next piece is “how do I get more money?” You need to sell stuff or send out invoices for the stuff. The stuff can be anything. Cookies. Jewelry. Consulting services. Lawn mowing. Anything you sell to make more money.
The opposite side of making money is spending money. You have to pay for the stuff that you used to make the stuff you sell. You also have to pay for other stuff that you need to run a business. Pens. Flyers. Flour for the cookies. Facebook ads. Phone bill. Paying people to help do other stuff. You know, the other stuff.
So, if you mush the cash in your bank account, and the making the money, and the money you paid out ALL TOGETHER you have a basic framework for the story that your business is going to tell. The BOOKkeeping of your business!
What story does your business to tell?