分类： 其他平台
2013-10-10 15:16:12
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3 questions you need to answer now Wow! The first quarter of 2012 is over. It in the books. How did your company do? If your business is like ours, things have been moving so quickly that it can be hard to see the forest for the trees. This is a great time to step back, take a deep breath, and determine where you are going for the balance of the year. Enough time has elapsed for you to see some trends, but there is still enough year left to make meaningful changes that will impact your annual results. We suggest answering three questions:
1. How did your business do? Do you know how your business did in Q1? At this writing, we are just into April, so perhaps your books aren closed for the first quarter, but they should be closed by the 15th at the latest. In our experience, too many small businesses don close their books in a timely manner. That the rough equivalent of trying to call plays in a football game without knowing the score, the time left or the down and distance.
Product Line Profitability If you sell products, you should know the profitability of each of your product lines.
Job Level Profitability If you provide a service, you should know the profitability of each of your jobs.
Aged Accounts Receivable You need to know if you are collecting the money that is owed to your business in a timely manner and if not, where to go to get it.
Inventory Your balance sheet will list your inventory, but you need to know inventory relative to sales by product (a typical measure would be inventory turns or days of supply). Be careful of averages. Your inventory may look great on average, but if you are stocked out of your fastest moving items and have six years of supply of your slow movers, that not a good thing.
Cash Flow A wise finance professor once told us, can buy beer with profit, you can only buy beer with cash. Cash is king. Make sure that your profit becomes cash in the bank.
P are necessary, but they are not sufficient. Even in a smoothly running operation, financials are usually not available until several days after the month ends. That can be too late. Consider a business that ships product. If shipments start to go out late, that will eventually turn up in the P as reduced revenue. Unfortunately, by the time that happens, the damage is done, the customers are gone. What needed in this case is a weekly or even a daily report showing the number of late orders. This will allow the problem to be identified and fixed before damage is done. Does your business have all of the metrics that it needs for you to sleep worry free?
