3 Months Forward: Two Different Ways

Most people look in the direction they're travelling.

Try running forward while looking backwards and you're one step from a mishap. Every business owner knows this instinctively. They want to see where they're going. Many have a vision for 1-3 years out, and a rough plan to get there.

So why do so many still get exhausted just trying to survive?

I think it comes down to one thing: the numbers they're using to navigate.

Hammering a nail blindfolded

Try hammering a nail in while blindfolded. It's hard — but notice what's actually hard about it. It's not the hammering. It's not being able to see.

When a business owner looks backward, they're not blindfolded at all. The numbers are there, fixed, and they can read them correctly. History doesn't move. That's usually the accountant's job, and most accountants do it well.

But turn the other way, to look forward, and the blindfold goes on. Not because forward numbers are inherently harder to see — because no one has ever made it simple enough to do.

Here's why. It's not that accountants don't care. A good number of them are genuinely trying to help — building cash flow forecasts, sitting down with clients, doing the work. But the detail they go into is exactly what holds it back. A proper forecast, done their way, is thorough enough to take hours and specialised enough to need them in the room. That's too heavy to repeat every quarter, let alone every month. So even the accountants who want to help forward-looking clients end up doing it once, if at all.

Then there's the other group — the ones who don't attempt it at all. For them, the only time a forecast gets built is when a client is chasing finance. The accountant, the broker and the financier do a dance to work out how much the business can carry. Once the money lands, the forecast gets filed away and nobody looks at it again.

I once had an accountant from this camp say to me: "It's easier just to wait until you get actuals."

Either way — too detailed to repeat, or never attempted at all — the outcome for the business owner is the same.

So business owners are left to navigate forward with nothing. Not because they're careless, but because no one ever handed them a simple enough tool. They default to the one number they can track without help.

Sales.

A client of mine — a seasonal trophies and awards business — watched revenue and assumed that was enough. No one had ever shown him a simple way to look forward, so he priced every job the same way, year after year, and trusted that steady sales meant a steady business. His costs had quietly crept up 8% and he'd never repriced to match. Once he had a simple way to see his numbers moving, he adjusted mid-season and pulled a proper wage out of the business for the first time in years.

Sales is easy to default to because it guarantees one thing — you'll be busy. And what's the first question everyone asks you? Are you busy?

Busy feels like proof you're on the right track. But busy isn't the same as banked.

The number that's missing

Revenue on its own tells you nothing about what you're keeping. To generate that revenue, you had to spend money in three places:

Product — what it costs to deliver what you sell

People — including a fair wage for yourself, not just staff

Promotion — what it costs to bring the customer in the door

Take those three away from Sales, and you get what I call Customer Margin — the actual return on the investment you made to win that customer.

Here's why this matters. If you're only watching Sales, you can't tell the difference between $10 of sales that cost you $9 to create, and $10 of sales that cost you $5 to create. On the one number you're tracking, they look identical. Both are "a sale." Only Customer Margin shows you which one is actually worth having.

Take two businesses, both doing $1M a year.

Business A is an ecommerce brand chasing revenue. To hit $1M they've had to spend heavily on ads — the growth doesn't come without it — and on top of that, every single sale carries the cost of the product itself. Product 48%, Promotion 24%, People 23% (staff only — nothing left for the owner). Customer Margin: 5% — $50K, and that $50K is already spoken for: more inventory, more ad spend, keeping the growth machine fed. The owner hits $1M in revenue and still can't pay themselves.

Business B is doing the same $1M, but every dollar of Promotion is measured against what it returns, and pricing accounts for the true cost of Product. Product 40%, Promotion 12%, People 28% (owner's wage included). Customer Margin: 20% — $200K. Same revenue milestone, a business that can actually pay the person who built it.

Same nail. One owner can see it move. The other can't.

Two ways to look forward 3 months

Business A and Business B wanted the same thing: to look forward and know they were heading the right way. Same revenue, same ambition. But they used two different methods.

Method 1 — ride by the seat of your pants, watch Sales, assume busy means healthy.

Method 2 — track Sales, Product, People and Promotion together, and know your Customer Margin.

Both are simple once you're doing them. But the small business failure statistics tell us which one most owners are still using.

This isn't a replacement for the accountants doing the detailed work — it's what makes their good intent usable. A forecast built once a year, or once when finance is on the table, can't be the thing a business owner navigates by. Customer Margin can, because it's simple enough to look at every quarter without anyone else in the room.

You already know which direction you want to travel. The only question is whether you can actually see the nail — or whether you're still swinging blind.

If this resonates and you'd like help taking the blindfold off, leave a comment or send me a DM.