A short YouTube presentation by Donna Genie advising studio owners on using accurate financial forecasting before making big decisions such as buying a location or hiring a manager. She emphasizes needing solid historical numbers as inputs, forecasting sales required to cover loan payments or payroll, and recommends working with advisors (pyopaccounting.com) to avoid risky “crystal ball” guesses.
I often hear studio owners express the wish of buying their own location or adding in a new manager to alleviate some of the pressures and stresses on the owner of the studio. These things can happen and really have a solid outcome if you know what you're planning for. The Crystal ball method is not always the greatest when it comes to making big financial decisions like this. But we come into this picture to help you. So in order to make a good decision, you'll need two things. You need to know the accurate financial picture of what's going on prior to that decision. What's happening in your business up to right now. And those numbers have to be solid or planning from those numbers will not be solid either. We need good inputs to get good outputs. We specialize in helping our owners forecast out what will happen. So if you're looking at a new location, how much will I need to make in sales to be able to cover the loan payment? Is that going to be a realistic expectation? What if I want to hire that manager? Have I reached that point? How do I know when I reach that point? How much in income will I have to have to be able to support that new manager without running out of cash and having to fire them, even though they may be a perfect fit for the job? Lean on your advisors in this business situation to help you make sure you make the right decision. You don't want to jump into the pool not knowing how deep it is. That could be a tragic move for a business. You could be okay and float along, but wouldn't you rather have the knowledge before you take that dive of how deep that water is? You should, and we're going to help with that. At pyopaccounting.com we work with our customers to help make sure that they make informed decisions rather than just hope for a lucky guess.
