by Sheri Heiney, President & CEO of the Prescott Chamber of Commerce
Most business owners are extremely busy working on various parts of their operations, so without regular checkups on financial health, they can lose control and become susceptible to financial problems.
Periodic business health checks can spot problems.
1. What are your Revenue Goals?
Every business should have revenue goals, both annually and monthly. If you hit goals, what did you do right?
Budgets help businesses predict the amount they’ll earn and ensure they have the means to cover expenses.
Identify How Clients Affect your Revenue
Do any customers drain your energy? Are they costing you more in lost time and motivation than they’re worth?
Firing your first client can be an emotionally charged experience, but it is a skill every successful business owner needs.
Review Best Revenue Sources
Having multiple revenue streams is good, but it’s important to dig deeper and determine which source of revenue is most crucial, makes the most efficient use of your resources and represents the greatest growth potential.
If your checkup reveals you’re spending too much time on an inefficient revenue stream, consider dropping it.
2. Expenses
Tracking expenses helps businesses chart a course with clarity and confidence. Make sure you’re on the lookout for the best deals on expenses like office supplies, travel and food.
3. Receivables
Do you do a good job of monitoring receivables and following up on past-due invoices? Have a clear policy on overdue accounts and follow through on collections; consider outsourcing.
4. Additional Areas to Monitor Bookkeeping
If you want to continue doing the books yourself, try setting aside a little bit of time each week. If bookkeeping is something you just can’t commit to staying on top of, it might be a good time to consider outsourcing.
Business Classification
Is your business classification still a good fit? Talk to your attorney and CPA about whether it makes sense to change your business entity
How Often Do You Need a Checkup?
Set a goal to perform your small business checkup every quarter. Try setting three goals and three key activities to help you reach your goals and keep your business growing and thriving for years to come.
For more information about the
Prescott Chamber of Commerce,
visit www.prescott.org, call
928.445.2000 or 1.800.266.7534,
or stop by the Visitor Information
Center at 117 W. Goodwin St.
