In this episode we discuss how you can paint your financial future and what I mean by that is not only developing and maintaining your budget, the boring stuff but having the confidence and how you show your financial circumstances and how you present those recommendations that you want to make.
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TRANSCRIPT
Introduction 00:00:00
This is the Your Sports Resource Podcast, where each week you’ll learn actionable strategies that you can implement so the operations of your club support your coaching staff and the direction of your organization. We are committed to excellence in Youth Sports Leadership. Let’s get started.
00:00:28
Hello and welcome to the Your Sports Resource Podcast. My name is Renata, and I am so happy that you’re here.
00:00:35
Today’s episode is about really how you can paint your financial picture and what I mean by that is not only developing and maintaining your budget, the boring stuff but having the confidence and how you show your financial circumstances and how you present those recommendations that you want to make.
00:00:59
So, I think I’ve said probably more than once that when I work with my clients, they are always in some form of uncertainty when it comes to their finances.
00:01:10
They’re either one step removed, meaning, you know, I, the Treasurer has it, or my finance person knows it, so I don’t need to be across it. That type of one step removed, or they don’t pay attention to at all, or they are completely underwater, like a small club like they’re just kind of.
00:01:28
You know, doing that churn and they’re doing that, you know, day-to-day I know my in and out my in and out my in and out but they don’t really have that overall picture of their financial circumstances.
00:01:38
OK, and I get it with the smaller clubs because they’re like an upstart right or a new business because they’re in there and they’re doing everything on their own so that totally makes sense.
00:01:52
OK, but what I’d like to do today is I want I’m going to touch a bit on preparing your budget, but I really want to talk to you about how you present yourself to tell your story.
00:02:04
And this can be adjusted to suit. If you’re asking for a loan. If you’re sharing the years, results may be at an annual general meeting with your membership, or just making a push with the big donor. OK, on the website www.yoursportsresource.com under Sports Leadership, you’ll find a Tool that goes with this episode, and what it does is it provides.
00:02:29
A lot more information than what I’m telling you today that you may be interested in it’s under Tools. It’s called “HOW YOU CREATE, MAINTAIN, AND PRESENT YOUR FINANCIAL STORY” and I believe again it’ll be under the Treasurer or the Finance person, but it will also be under Sports Leadership.
00:02:44
It’s free. Go get it. Whether it’s for yourself or that you give it to someone else but it really kind of a companies and goes along with this with this podcast.
00:02:53
OK, so let’s talk about why you, as a leader or your leadership team need to know your budget, your actual spend month-to-month forecast for at least three months down the road.
00:03:05
First and foremost, it puts you in a position of security and control. And what I mean by that is you have less surprises and you can make real proactive decisions instead of always be in reaction mode. OK.
00:03:23
As an example, big spins and receivables usually never land neatly into one month, right? It just it’s unusual for that, especially in sports. When you’re doing like, let’s say, a big spend is a meet OK, so let’s say it’s a swim team they’re having a swim meet. Expenses start coming in. You know a minimum of 30 days prior to the meat.
00:03:43
And then you’ll probably have vendor charges or a lot of reconciliation that’s gonna happen 30 days after the meat.
00:03:51
So that’s a span of potentially three to four months that you will be in and out with your, with your money.
00:03:57
So, if you don’t plan and show your finances in that way even though intellectually in the back of your mind you’ve got it tucked away that I, I don’t know, this big vendor that we hired hasn’t still billed us, and you know you got to pay that bill.
00:04:12
It’s better when you have that visual picture that says hey, this isn’t in yet, so you don’t end up going, oh, I’ve got money in the bank. I’m going to spend it right and it ends up being a surprise, right? That’s what I’m saying when you’re trying to avoid that.
00:04:28
So, this leads into when I say making well-informed decisions. Now I know you guys have heard me talk about this over and over and over again and I don’t care what size club you are.
00:04:38
You know there’s a lot of times that and even we as individuals, right?
00:04:42
We just kind of jump in and make decisions and sometimes you know a lot of times that’s OK, but when you’re talking about your financial stability of your organization, that’s really not a good practice to be it.
00:04:52
OK, so let’s say you’re doing your future planning and you can see that you know you have something later in the year that you need to ensure your booking things at that time to support whatever that activity is, right.
00:05:06
So, what I mean by that is you’re not going to make a decision to spend an X amount of money when you know you got something big coming in three months and you need money in the Kitty in order to fund that so again it puts you as a board in a position to make well-informed decisions.
00:05:23
OK, so if you’re on the board, you probably have a dedicated person that manages the finances, usually the treasure they can work with an accountant. If you’re big, you might even have a bookkeeper, right?
00:05:37
But that does not mean that the board should avoid understanding the finances again, just because someone else has a handle on them.
00:05:45
You must know the financial impact, your decision to make on the club and the membership and I’m quite honestly really tired aboard, shrugging off their finances or their responsibility to do their due diligence on their finances because it doesn’t matter if someone else is managing them and you trust them, you need to at least have an overall decision.
00:06:09
And the reason for that is, as a board member, you are financially responsible, and you bear the weight of the financial implications that are made from a bad decision because you didn’t have the full picture or you didn’t care to look at the full picture, OK?
00:06:26
Even if it’s just a timing thing, right? Like you misspent before you know you have money coming in, even if it’s something like that.
00:06:33
It doesn’t matter if there’s any type of situation that puts you in a position where you look like you haven’t done your due diligence and you’re not on the up and up. You are absolutely responsible for that decision.
00:06:45
No one else is going down you as a board member and all the board members are going to face you know, reputational risk for making decisions like that.
00:06:55
So, get used to reading your financial reports, you know, put him in an easily consumable way so you can understand them.
00:07:02
I get them not everybody likes to look at finances. I get that but have your treasure or create reports that are easy to understand and consume.
00:07:10
They do things in buckets, OK, if you want me to elaborate more on that, please write me, I can respond to you individually at info@yoursportsresource.com.
00:07:20
And I can give you some guidance on what I mean by doing some high-level reporting that’s easy to understand and consume, so at least your board has an overall decision, and I don’t mean to direct that just at boards because there’s a lot of coach run teams, at least in the swimming arena to where they do have a leadership team and the leadership team is making decisions.
00:07:40
Right, so that goes for them as well. They need to understand their finances, and you know a lot of time coaches don’t want to pay attention to the finances, they want to pay attention to the coaching rightly so. But if you’re making decisions for the club, you have a responsibility to understand your finances. OK.
00:07:59
Now for those smaller clubs I know not everyone has the background or even the desire to do that type of financial analysis and planning to set up, you know your budget and your monthly reporting.
00:08:10
There’s a couple of options that I’d like to put forward and, and they both are about you getting help, right?
00:08:14
So, the first thing I recommend is that you go out to your membership. You were bound to have a parent who was in the financial industry just ask them to formulate some reporting that shows you your budget, your actuals, and you’re.
00:08:27
You know basically your three-month out view and have them teach you how to keep up with that reporting so you can take it over yourself and easily keep up with it, right?
00:08:38
Usually, the daunting task is taking all the information and putting it into our report. But once you’ve got it and you understand how to keep it up to date, it should be easier for you.
00:08:47
OK, there’s plenty of online tools to that help you with automation and you know principles that you can implement to help you.
00:08:53
The other option is to engage a professional now we at Your Sports Resource can be one of those options we partner with an accounting firm that helps us go through finances all the time and they partner with us.
00:09:06
We build some reporting for our clients, we pull all their details together, we help them. I help them build the budget and then they help me formulate basic reporting and I can give that back to my client so we can help you with your planning for the future and helping align those to your goals.
00:09:24
And we can, you know, just write some simple reports so you can easily understand your finances. Again, just write us and let us know if you’re interested that’s info@yoursportsresource.com.
00:09:34
OK, I really want to get into the next part cause this part is what is exciting and that’s HOW TO PRESENT YOUR FINANCIAL PICTURE.
00:09:43
So, what I’m going to lay out should be really the same or good if you’re looking for a loan presenting to a donor or your members.
00:09:53
OK, but obviously, but some of these areas you may choose to expand or reduce based on the audience.
00:09:59
OK, so the bottom line is you’re creating a story that truthfully represents your financial situation and you’ll go bigger in some areas and smaller in some areas depending on who the audience is that you’re presenting to.
00:10:12
OK, so I don’t know if you have ever heard of social math.
00:10:20
But this is a way that you can present your numbers, so they are visually understandable. Sometimes they’re shown in a pictorial, so it’s easy to conceptualize and consume.
00:10:33
So, an example that I found online is like a nonprofit in North Carolina, wanted to visually show the percentage of those citizens in North Carolina who live in poverty, so the graphic shows the number in percentages, but it also gives like a side graphic, and it’s got like 5 pictures of people on the side and one of those people is, so they’re all green and ones in a dark green, right?
00:10:57
And so, what they’re trying to show is that one in five Carolinians are living in poverty.
00:11:03
OK, so it’s a really simple graphic and an understanding, but what that does is while you’re listening to the numbers and you’re watching the visuals and the graphics your audience is really able to understand and it just kind of solidifies your statements.
00:11:23
OK. So, you as a club could show something like your membership base in the community and the impressions of potential supporters or you know a business might get
00:11:34
By partnering with your organization or to your membership, you might present how many of your athletes went to national competitions or placed at national competitions so it would be a pictorial between you know the percentage of your overall numbers to those who actually went to national competitions, right?
00:11:52
Especially if you’re trying to push a financial drive, it can be used to showcase how you want to fund a capital project, what the benefits would mean to the team.
00:12:03
So, the social math is really just think of it as a lot of people don’t just learn one way, right. Some people learn by writing and doing. Some people learn by listening. Some people learn by reading, right?
00:12:17
So, think of it as the same way you’re trying to get your numbers across and when you’re talking through them, a visual perspective on it. You know the Social Math is what they call it.
00:12:26
Then it really helps solidify and brings that audience along OK, but here’s the kicker. If you present information that is inaccurate, that will be the demise of your credibility. OK, I know this is common sense, but I gotta say it.
00:12:43
OK, so you must do the work up front to truly understand your finances. I can’t stress this enough if you showcase to potential customers or to a sponsor and your numbers aren’t anywhere near accurate. It will only help you hurt you in the realm of future sponsors.
00:13:04
And I know again it’s common sense, but honestly, a lot of people will fudge graphics and fudge numbers. Just don’t do it. Just say, don’t do that. It’s close enough, OK or don’t do that well that’s what it would be. Do what it is.
00:13:19
OK, another way to paint a picture is to incorporate data into your requests or recommendations. Now what this does is it helps to provide credibility to your story.
00:13:31
OK, so you might pull statistics that are larger general off the Internet, or you may speak to another team and ask, hey, how did you benefit from whatever it is that you’re trying to recommend? What this does is it emboldens. The listeners belief in what you’re trying to do.
00:13:50
They can understand that you’re not just speaking or presenting a desire, something that you want. What they’ll do is that they’ll go OK. You’re really talking about a true and real opportunity.
00:14:02
Hey, and I can see how this has worked for others, right? That’s where you want. To get to this is a very different story, right?
00:14:09
So, you don’t want to go into the wood, it could have should as you want to go into that.
00:14:12
Yeah, this is what we want to do, but here’s the proof behind it to back it up on why it works and why we’re making this decision.
00:14:18
OK, you would personally buy into something I don’t mean financially, it might be financially, but you would buy into a concept or an idea that has some credibility behind it, right?
00:14:29
So, I think doing the incorporating of the data and then wrapping that up in visuals, doing that social math is just a massive way to present your financial standing, OK?
00:14:45
The next area is to summarize your financial report with clear and simple recommendations.
00:14:52
OK, now this might be the story you’re trying to tell your board or your membership, and these recommendations might be one where you paint the picture that things are dire and you’re telling the audience where the belt needs to be tightened.
00:15:07
OK, or it might be that there’s financial waste and you’re recommending a tool that automates large man hours, and with overall savings to the organization it could be any of those, right?
00:15:20
This is something that your financial person should be doing monthly anyways. If you’re a larger club, but I’m putting it in here because again, it’s how you are presenting your financial state that matters, right?
00:15:33
So now, once you have the recommendations, good or bad, you can back them up again with the statistics or the data, and quite possibly do some social math with it OK?
00:15:44
You back it up with the visuals and the data. It’s massive. Again, if you want to make an impact, you have to hit on a couple of those intellectual senses. Hearing and seeing a visual representation is key.
00:16:01
Lastly, when painting a picture, you must show positive outcomes, right? Obviously common sense, but a lot of times people go straight into just asking or telling a story. OK, but you need to show the positive outcomes.
00:16:15
So, when you’re making your recommendation and you’re showing the stats from others, and you have visually created an image. They need to understand the true benefits that are likely to occur for your club or organization.
00:16:33
Personally, OK, so you’ll probably support it with statistics of. This is how it worked for this club, but people are going to want to understand the positive incomes that benefit them and the membership. Hopefully, that makes sense, OK?
00:16:47
So, this makes it personal, relatable and people understand the impact on the team. So, you go from this is our situation and here are my recommendations to this is what it means and then finally this is how will benefit.
00:17:04
OK, so that’s like that whole picture I just painted for you. So, let me add the stab of creating a real picture.
00:17:12
OK, so let me have a stab at creating a real picture, OK? I’m gonna use something big because it’s easier to demonstrate.
00:17:20
So, let’s say you have an issue where your club is at Max pool space capacity, and you’ve done your due diligence and feel that owning and or building a pool on your own.
00:17:33
So, purchasing or building a pool on your own will not only benefit the club but maybe even the community, right?
00:17:40
So, from a financial perspective, you will show the amount that will need to be raised no matter what approach you go, so your current financial state will most likely. I’m not going to say never cause not everybody is in the same boat, but your current financial state will most likely not be able to support a new poll.
00:18:01
OK, so the picture you’re painting is, what is the financial impact it will have in your membership and your growth. Your ability to host several meets year after year and how you can turn it into a community revenue builder.
00:18:17
OK, so a bigger facility might bring in higher quality coaches and swimmers as well, so there’s this other different type of effect and benefit that your club could reap, which again that too will also have a financial impact.
00:18:31
Many of these items you come back with you know, what other clubs have done, so you get your statistical data and then you can visually demonstrate all that in a graphic so you get your social Math as well.
00:18:45
Then you can wrap the intrinsic community benefits swimmer benefits. I mean they have more water time or even better practice times because you have flexibility. Things like that, you know.
00:18:56
So, what’s good about this process is when you’re going after something big, there’s always resistance.
00:19:04
Right, it’s change. It doesn’t matter if you’re asking the membership or if you’re asking a potential sponsor for you know I don’t know, I guess buying the Jumbotron at your new pool.
00:19:15
What you’ll need to really paint is the picture from start to finish in order to reel them in, and I think this is where a lot of clubs really missed the boat.
00:19:23
They don’t paint that big picture, so everything that I talked about today, so understanding your budget in your forecast in your needs, then creating the recommendations where you want to go supporting it with statistical data.
00:19:40
Showing it with social math or in visual means really allows you to paint the whole picture and set your club up for success and sets you apart from everybody else who has their hand out asking for money and that’s a big one, OK?
00:19:57
OK, if you need help, let us know whether it’s getting your finances in order or building a proposal or presentation to showcase your financial story, we can help.
00:20:05
Now you can write me at info@yoursportsresource.com or you can just go to the website and book a call with me to discuss.
00:20:12
No pressure and don’t forget to go find the accompanying Tool to this podcast. Again, it’s under Sports Leadership and the Financial Section and it’s called, MAINTAIN AND PRESENT YOUR FINANCIAL STORY. Alright.
00:20:25
Thank you for listening and please subscribe rate and review this podcast so more can hear about how they can improve the Operational Leadership of their Sports Club.
00:20:34
Remember, you can also find more on our website, www.yoursportsresource.com. Thanks for spending time with me today.
