Are your finances a garden or a forest? Which is best?

Written By Ian Corrigan, Account Manager at The Business Shoppe

In a forest the natural, chaotic order of organic life is readily apparent. Tree sprouts and vegetation fight to hang on to a spot of soil. They elbow their way to secure space and nutrients enough to survive. Trees and vegetation that have already “made it” spread out their leaves to soak up the sunshine, leaving random spots for new growth below them. Organisms in natural settings have to use their survival and defense mechanisms to be able to stake their claim, grow, and establish their lives. It’s a harsh and competitive world for new starts in a forest, sometimes starting and maintaining a small business can feel the same way.

One thing that separates us (humans) from the whim of the processes of nature that came about at the end of the paleolithic era: agriculture. Humans developed a means of sustaining themselves off of the land with less chaos and chance. Instead of depending on the yield of forests, flora and fauna growing and populating at a natural rate, humans created gardens and then subsequently farms. The stability of agrarian societies were the fertile ground for metropolitan and mercantile communities. Without the consistent, somewhat predictable flow of produce from agriculture I wouldn’t be typing this on a computer today. The conscious intent that went into farming allowed society to grow and scale in a more predictable and reliable fashion, it revolutionized the human species.

Sometimes, when clients come to us we find their finances in a state of natural chaos. If we think of income as the soil in which expenses take root, we can see the expenses as roots in the soil. These “financial root systems” establish themselves and draw nutrients and resources to themselves. Most of the expenses are essential to a business, such as inventory purchases, cost of travel, rent, dues and subscriptions, etc… A lot of the time we find, especially in accounts of small businesses where personal and business spending mingle, these established root systems take up space and eat up nutrients. Overshadowing new starts that might be more advantageous for the client’s business at that time.

We always encourage clients to have their business finances be a garden, not a forest. Gardens are intentional and tended to. A gardener weeds out plants (expenses) that aren’t in the interest of the greater good of the garden and plants new starts when they want to grow new produce. A gardener also has to arrange the garden into sections based on each plant’s root system and fertilization needs, just like a business owner needs to categorize and track expenses. Gardeners also must till the soil, this can be reviewing income streams and expenses that draw from the income, to be able to ensure that plant root systems are getting the nutrients they need and are yielding a sustainable crop (owners draws from the business).

I could draw parallels all day, but what it boils down to is conscious intention not only yields sustainable results but it also ensures that the chaos of natural processes are managed. Creating sustainable production and yield cycles in your business result from having an organized system of monitoring expenses (planting, weeding), returns on investments (seasonal yields), and investment tracking (tilling the soil).

This can be done by ensuring that your business has a proper accounting system that is powerful enough to generate financial reports. Also being able to understand the reports that are generated from tracking your transactions is clutch in being able to intentionally curate your business. Also knowing how to calculate appreciation and depreciation in regard to your scaling and growth as a business is an important tool for success when organizing your business.

Having the right tools and organization are essential in tending to your financial garden to have it successfully yield the return you need to be able to grow and scale your business. Don’t let the weeds get out of control, don’t let the season for planting pass you by, and if you do, make sure you go in and get to work as soon as possible so you’re not at the whim of nature when it comes to what sustains your business.