Financial confidence is one of the most powerful things a woman in business can build. Understanding your business finances gives you the clarity to make better decisions about money, growth and the future of your business.
The good news is that financial confidence isn’t about becoming an accountant or a spreadsheet expert. It’s about understanding your business finances well enough to know what the numbers are telling you and using that information to make confident business decisions.
After working with women business owners at different stages of their business journeys, I've noticed that the issue is rarely that they don't understand their business. They often understand their customers, their service and their market exceptionally well. What they sometimes lack is the financial visibility i.e. the ability to connect what they know about their business and what their numbers are telling them.
I see financial confidence as an essential leadership skill. Why? Money decisions shape so much of what happens next. The more you clearly understand the financial position of your business, the more confidently you can decide where to start, what to stop and what to change and where to invest for growth.
Start with financial visibility, not perfection
The first place to start is visibility, not perfection. You do not need the perfect system, the perfect app or a perfectly colour-coded spreadsheet before you can take control. You need enough reliable financial information to understand what is happening in your business today and what might happen next.
One of the first things I encourage business owners to do is simply look. You need enough reliable information to understand what is happening in your business today and what might happen next.
I worked with a business owner who knew her sales figures almost instinctively. She knew which services her clients loved and where she wanted to take the business next. However, when we looked at the numbers together, we discovered that one of her busiest services was generating a much lower profit margin than she realised.
The answer wasn't necessarily to stop offering it. The numbers simply gave us a better question to ask: was this service priced and delivered in the right way?
Look at
- What comes into the business and when?
- What goes out?
- Which costs are fixed, and which change?
- Which products, services or clients generates the strongest profit margin?
- How much do I need to keep aside for Vat, tax and payroll?
- What can the business realistically afford to pay me?
I find that even a regular 30-minute financial review each week can change how you feel about your finances. Confidence grows when the numbers stop being a mystery and start becoming something you can work with.
Separate financial facts from feelings
Money can feel emotional and I know it can be hard not to take the numbers personally, especially when your business is closely tied to your identity, family responsibilities and personal goals. I've seen business owners interpret a quiet month as evidence that they are failing or assume that a healthy bank balance means they can afford to take money out of the business. Neither conclusion is necessarily true.
One business owner I worked with was worried because her sales had dipped compared with the previous month. When we looked at the wider picture, however, the underlying position was much stronger than she thought. A large customer payment had simply been posted on the 1st of the following month. The numbers changed the conversation from “Why is my business going backwards?” to “Is there actually a problem here, or is this just timing?”
That is why it helps to separate the story from the evidence. Instead of asking, “Am I doing well?”, I’d encourage you to ask more specific questions:
Is revenue growing, stable or declining?
- Are margins improving?
- Do I know my break-even point?
- Am I paying myself sustainably?
- Do I have enough cash to cover the next three months?
Specific questions create specific answers. And specific answers make decision-making feel much easier.
Build a simple cash flow forecasting habit
Profit tells you whether the business model is working. Cash flow tells you whether the business can keep operating while that model plays out. I've worked with profitable businesses that have still experienced significant cash pressure. The problem wasn't necessarily that they weren't making money. It was that the money wasn't arriving at the same time as the bills needed to be paid.
One of the simplest cashflow forecasting tools I use with business owners is a 12-week rolling cashflow forecast. It doesn't need to be complicated. You simply look ahead at the cash you expect to receive and the payments you know or reasonably expect to make.
I've included a simple 12-week cashflow forecast template that you can download and use for your own business. Spend 20–30 minutes completing it and you may be surprised by what it tells you.
More importantly, don't just look at the numbers. Ask yourself: “What decision do I need to make now because of what I'm seeing?”
That might mean chasing an overdue invoice, delaying a non-essential purchase, reviewing a payment arrangement, bringing forward a sales conversation or simply recognising that you have more capacity to invest than you thought.
Know what your business is really worth
One of the patterns I've seen repeatedly when working with women business owners is under-pricing. Not because they don't understand the value they provide, but because they can be reluctant to put a price on that value.
We worry about being too expensive, losing clients or sounding too confident. Pricing is not just a number. It is a statement about value, sustainability and capacity. Your pricing needs to support a sustainable and profitable business; not simply cover the hours you spend delivering the work.
When I think about pricing confidently, I look at the full picture: delivery time, expertise, overheads, tax, non-billable work, risk, desired profit and the transformation your work creates for clients. If your prices only cover the visible hours, they are probably too low.
The question I encourage them to ask isn't simply “What will my client pay?” It's “What does this business need to charge for this work to be sustainable and profitable?”
If the numbers tell you that your current price doesn't support the business you want to build, that's not a pricing problem, it's a business decision that needs to be addressed.
Don’t wait until there is a problem to get financial support
It’s important to remember that financial confidence doesn’t mean doing everything alone. In fact, the most financially confident business owners I know and work with usually have the right support around them. That might be an accountant, bookkeeper, financial adviser, mentor or trusted peer network. They recognise that seeking advice isn't a sign that they don't know what they're doing. Quite the opposite. Strong leaders know when they need another perspective.
My advice is to seek support before you feel stuck. Sometimes that perspective comes from someone who can look at your numbers objectively, challenge your assumptions and help you understand what they are really telling you. That's where an experienced finance business partner can add real value. Ask questions, request explanations in plain English and challenge jargon. You deserve to understand the numbers that shape your business.
Five things you can do this week
- Look at your cash position and identify your biggest commitments over the next 12 weeks.
- Review your three biggest costs and ask yourself whether each is still adding value.
- Look at your pricing and determine whether it delivers the profit your business needs.
- Choose one financial number you will review every week until you have been through them all
- Write down one financial question you have been avoiding and seek help to get it answered
Financial confidence is built, not born
You do not need to know everything to be financially confident, none of us do.
You just need to be willing to look, ask, learn and act. The more familiar you become with your numbers, the less power they have to intimidate you.
I've seen the difference this can make. When a business owner moves from avoiding the numbers to understanding them, the conversation changes.
They stop asking, “Can I afford this?” and start asking, “Is this the right investment for my business?”
That's a very different way of leading a business.
Your numbers aren't there to judge you.
They're there to inform you.
Every business has a story. Your financial information is part of that story, telling you where you've been, where you are now and potentially what needs to happen next.
The important thing is learning how to read it.
Ready to understand what your numbers are telling you?
If you're running a growing business and would like greater clarity over your numbers, cash flow and profitability, I'd love to help you make sense of the story behind them
Let's turn your numbers into insight, and your insight into confident decisions. Get in touch with Ekstra Accounting Solutions today.