How much of your business
are you running on feel?

Where did your clients come from last year? Not roughly. Which activity produced which client.

Most owners can't answer that. Not because they haven't been working, and not because they're disorganised. They've simply never set anything up to record it, and nobody has ever made them.

I couldn't answer it either, which is how I ended up writing this.

Six things you should be able to describe

Try these without looking anything up.

Who your customers are, and how many. The actual count, and whether you'd describe them as one group or four.

Whether they stay. What share of last year's customers still are. And before you answer, what does "left" mean in your business? Most owners have never had to define it.

Where new ones come from. Referral, search, an event, someone's cousin. If the honest answer is "it varies," you have no idea which of the things you're doing is working.

Whether interest turns into business. Of the people who genuinely enquire, how many become customers. This is where most of the money leaks, and almost nobody watches it.

What one customer is worth. Over a year, and over the whole relationship. Those are different numbers, and the second usually changes what you'd spend to win someone.

What's left after costs. Of every dollar coming in, what survives, and whether that number is going the right way.

Why almost nobody can answer

The information exists. It's sitting in places that were never set up to talk to each other. Customers in one system, money in another, enquiries in an inbox or a calendar or nowhere at all. Until someone asks for all of it at once, there's never been a reason to put it side by side.

There's a deeper reason too. Most owners didn't set out to run a business. They set out to do the work. The dentist wanted to fix teeth, the builder wanted to build, and the operating side arrived as a tax on doing the thing they actually trained for. Tracking is the part of that tax nobody enjoys paying.

So it gets skipped. Almost universally. Owners doing multiple six figures, in business ten years, often can't answer these questions either. The ones who can are the exception, not the standard you're falling short of.

What it costs

The obvious cost is wasted effort, and that's real. It isn't the expensive part.

The expensive part is that every quarter starts from the same place, doing a bit of everything, because nothing has ever been ruled out. You can't stop doing something you've never proven doesn't work. So the list only grows.

The second cost is harder to admit. When you can't see whether things are working, you work more, because more feels like the safe answer. Activity becomes how you manage the anxiety of not knowing.

And the third: business development is the first thing dropped when client work gets urgent. It has no deadline and nobody chasing it, so it loses every time. That isn't a time management problem, it's a structure problem.

The exercise

Take those six things. Answer what you can from memory, then put a label beside each one:

• Measured if it came straight out of a system.
• Worked out if you calculated it from other numbers.
• Guessed if you used your judgment and nothing else.
• Don't know if that's the truth.

Count how many land in those last two. That's the share of your business you're running on feel.

Print this. Fill it in. It takes ten minutes.

The "don't know" label matters more than it sounds. A guess written down as a fact becomes a fact by next quarter. Nobody remembers it was invented, least of all the person who invented it.

Simple isn't the same as easy

None of this is complicated. It's a spreadsheet and an afternoon. Any owner reading this could do it Saturday morning.

Most won't. I didn't, for three years, and this is close to what I do professionally.

When I finally said as much to a coach, that I already knew all this and she was pointing out the obvious, her answer landed: if it's so obvious, why haven't you fixed it?

Here's why it's harder than it looks. The first pass isn't the difficult bit. A number only means something next to the last one. One reading tells you where you are. Twelve tell you whether anything you did mattered. So the value only shows up if you keep going long after the novelty has worn off, in months when the client work is urgent and nobody is asking.

Setting it up is a weekend. Keeping it up is the actual job.

Two things worth doing about it

Get someone outside the business asking. That's what makes it stick. Not expertise, just a date in the calendar and a person expecting answers, because work that matters with no deadline loses to urgent work every time.

If you want to explore whether that's worth it for a business your size, get in touch and I'll make an introduction.

Disclosure: my coach at Avid is my wife, Kehla Guimond. I receive no referral fee or compensation for introductions, but you should know the relationship before you weigh any of this. Coaching services are provided by Avid Business Performance Group and are not offered through Portfolio Strategies Corporation.

Then build the financial plan on top of them. Once you know what the business actually produces, the personal questions become answerable. What the company can afford to pay you and in what form. What to do with money that stays inside it. Whether the insurance covers what would actually happen. What any of it means for the year you stop working.

Those decisions get made separately in most households, usually by different people, none of whom see the whole picture. That's the part I do.

Common questions

What numbers should a small business owner track?
At minimum: how many customers you have, what share of them stay, where new ones come from, how many enquiries become customers, what one customer is worth over a year and over the relationship, and what is left after costs.

Why do most business owners not track their numbers?
The information usually exists but sits in systems that were never set up to talk to each other. There is also a simpler reason: most owners set out to do the work rather than to run a business, and the operating side arrived as a tax on doing the thing they trained for.

How do I know which of my marketing is working?
By recording where each new customer came from, consistently, before you need the answer. Without that record you cannot tell which activity produced which result, which means nothing can ever be ruled out.

What is the difference between a business plan and a financial plan?
A business plan deals with what the company does. A financial plan deals with what the money is for. They are usually built separately by different people, which is why the two often assume different things.