What Are Your Numbers Trying to Tell You? How to Read the Story Behind Your Financials

Most small business owners treat their financial reports like that pile of unread mail on the kitchen counter. You know it’s important… but it’s also overwhelming, full of unfamiliar terms, and easy to ignore when you’ve got more “urgent” things to do.

But here’s the truth:

Your financials are telling a story.

 The question is—are you listening?

When you understand how to read your numbers, you stop making decisions based on emotion or assumptions. You start leading your business with clarity, control, and confidence.

Let’s break down what your numbers are trying to tell you—and how to actually use them to run your business better.

Your Financials Are Not Just for Taxes

If the only time you glance at your profit & loss statement is in April, you’re missing 90% of the value it can bring. Your numbers can help you:

• Identify what’s working (and what’s not)

• Spot red flags early

• Make smart decisions about hiring, pricing, and growth

• Plan for cash flow dips before they happen

• Measure your progress month-to-month or year-over-year

  
  

This isn’t just about compliance—it’s about running a business that actually supports your life.

3 Key Reports (and What They Reveal)

1. Profit & Loss (P&L) – The Story of What’s Happening Right Now

This report shows your income, expenses, and net profit over a period of time.

What it tells you:

• Are you actually making money—or just making sales?

• Which expenses are creeping up month over month?

• Is your cost of doing business too high for your revenue?

  
  

Questions to ask:

• What’s my most profitable product or service?

• Are there expenses here that aren’t serving me anymore?

• Am I setting aside enough for taxes and savings?

  
  

2. Balance Sheet – The Story of Stability

The balance sheet is a snapshot of what you own vs. what you owe.

What it tells you:

• Are you building financial health or staying stuck in survival mode?

• Do you have enough assets (cash, equipment, receivables) to cover your liabilities?

• Is your business gaining or losing equity?

  
  

Questions to ask:

• Am I over-leveraged or cash-poor?

• What debts are weighing my business down?

• Is my retained earnings balance growing over time?

  
  

3. Cash Flow Statement – The Story of Movement

Cash is the lifeblood of your business. Even profitable businesses can go under if cash isn’t flowing properly.

What it tells you:

• Are you consistently bringing in more cash than you spend?

• When are your high and low cash months?

• Are you investing too heavily in growth without a cushion?

  
  

Questions to ask:

• Is money coming in fast enough to support my expenses?

• Do I need to adjust my payment terms or invoice follow-up process?

• When will I need to build a cash reserve?

  
  

What Healthy Numbers Sound Like

If your financials could speak, here’s what you’d want to hear:

✅ “Your margins are strong—you’re not just making sales, you’re making profit.”

✅ “You have enough cash to cover your expenses and invest in growth.” ✅ “Your business is building equity, not just surviving paycheck to paycheck.”

✅ “You know what to expect next month, next quarter, and next year.”

How to Actually Read the Story

Reading the story in your numbers doesn’t mean you need to become a CPA. But it does mean you need to:

Look at your reports monthly (not just at tax time)

Set aside 30 minutes a month to review them. Make it a ritual—coffee, calendar, and a clear head. Ask better questions, not just “How much did I make?”  Try:

1. “What’s working best right now?”

2. “Where am I overspending?”

3. “Where am I undercharging?” Get support if you don’t know what you’re looking at  You don’t have to figure it out alone. A good bookkeeper or financial consultant can help decode the story, spot blind spots, and help you make data-backed decisions.

   
   

Your Numbers Aren’t Judging You—They’re Guiding You

It’s easy to avoid the numbers when you’re afraid of what they might say. But here’s the thing:

Your financials are not a reflection of your worth. They’re a tool to help you grow.

They’re not there to shame you—they’re there to show you. What’s working. What’s not. What’s next.

Want Help Reading Your Business’s Story?

At Seeds, we help small business owners like you go from overwhelmed to in control. Whether you need a financial cleanup (The Weed Out) or want to build systems that bring peace and profit (Seeds of Structure), we’ll help you see the full picture—and grow with clarity.

👉 Book a free discovery call to get a clearer view of what your numbers are really trying to tell you.