When you initially planned to buy or open your independent pharmacy, you showed your potential investors, partners, and lenders a business plan with well-documented financial statements. If a new opportunity presented itself today, how much time would it take to produce updated financial statements?
Management skills can be demonstrated in many ways: 5-star reviews online from customers, a team of stable, productive employees, and growing daily sales numbers. Though all of those are good (actually, great) things, if you are looking to take advantage of an opportunity to grow or expand your business, your potential partners, investors, or lenders look for proof of your solid management skills in your up-to-date financial statements. If just thinking about producing them makes you cringe, you are not alone. Ask any lender, and they can share stories about receiving financial statements that are less than impressive: they are handwritten, barely legible, incomplete, incorrect, or just out-of-date.
Why is this important? Accurate, well-documented, and up-to-date financial statements that are easily available when you need them clearly express your management skills. It shows that you pay attention to the details that impact your bottom line. And if you want to take advantage of a new business opportunity, you need these at your fingertips now while the opportunity is hot.
What should your financial statements include?
Your financial statements should include:
- Income statement
- Balance sheet
- Cash flow statement
- Detailed documentation that supports each.
Some of those details should include reports and details on:
- Expenses
- Payroll
- Inventory
- Accounts Receivable/Aging
The insights you gain by documenting and reviewing these elements regularly can help you identify and address potential problems earlier.
