Dumb Financial Mistakes Business Owners Make and How to Avoid Them

I have been crusading against dumb financial mistakes business owners make small business owners make ever since I lost $1M off the sale price of my last business because I could not read a balance sheet; and I had an MBA from Northwestern University!

On The Small Business Radio Show this week, my guest is Ruth King who is the President of Business Ventures Corporation. Ruth has a passion for helping businesses get and stay profitable.  She is especially proud of one small business owner who had $750,000 in revenues when Ruth started consulting with him. Sixteen years later, the business had grown to $10 million and it was sold for $9 million in cash!

Her latest book, “101 Dumb Financial Mistakes Business Owners Make and How to Avoid Them”, will be released in September, 2023.  It is preceded by the #1 Best Selling book, “The Courage to be Profitable”.

Here are the dumb financial mistakes we discussed and how to avoid or fix them:

• Abdicating the Responsibility of the Financial Side of Your Business.
• Having the Mercedes Benz Syndrome.
• Blinding Accepting What Your CPA Says.
• Ignoring Weekly Cash Flow Reports.
• Not Billing on Time.
• Focusing on the Top Line instead of the Bottom Line.
• Not Asking Your Employees to Fully Participate in the Financial Goals of the Business.
• Not Knowing Where Your Leads Come From.
• Not Tracking Sales Peoples’ Close Rate.
• Not Firing a Customer.
• Not Having a Buy- Sell Agreement with a Partner.
• Not Knowing Why You Are in Business.
• Pricing Incorrectly.
• Paying Commissions Based on Gross Margins.
• Not Considering Unbillable Hours in Your Pricing.
• Not Raising Prices When Costs Increase.
• Not Recognizing That Your Balance Sheet is More Important Than Your Profit and Loss Statement.
• Not Collecting Your Accounts Receivable on Time.

Listen to all the dumb financial mistakes we make on and how to fix them on The Small Business Radio Show.

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Image: ruthkinghvac