I see it over and over again. Business owners who don’t pay attention to their finances eventually run into cash flow problems. If they’re lucky, they’ll find a source of cash, keep going and eventually turn the business around. If they aren’t lucky, they can wind up bankrupt, with their dreams dashed.
As we approach the half-year point, it’s time to evaluate your business plan and goals for 2010 against what is actually happening. This is true across all areas of your business–financial, sales, organizational, etc. Can you answer the following questions to your own satisfaction?
- What do you have in liquid assets (bank accounts, money market, etc.)? Do your bank statements match your cash flow reports? If not, do you know why?
- Is there enough money in the bank to cover your business expenses for the next three months? If not, do you have plans to improve that situation?
- What do you owe? Do you have a plan to reduce your debt if the debt/equity ratio is greater than 20%?
- How does your profit and loss statement look? Are there sales numbers that are lower than you want? Are their expenses that can be reduced? (The economy seems to be recovering, but we’re not out of the woods yet.)
- If sales are lagging in some area, what do you plan to do to change that situation? If you don’t make any changes, you can’t expect the sales figures to change either.
- If you have inventory, do you have too much? Too little? Will you need to get more inventory for the holiday sales season? If so, do you have the cash flow to be able to do so?
This is simply the start of the analysis you must do as a small business owner to insure that your company stays afloat and grows, no matter what the economy. Our guide, Increase Business Results, available for only $7, can help you review your business so you can achieve your business goals for 2010. Click here to order the e-workbook and improve your business results starting today.
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