Judging the health of your small business is incredibly important. Without proper metrics tracking your business you could be a weeks or months away from major issues. At AMP Business Coaching, Alice Pallum is passionate about helping business owners track what’s working in their businesses and what areas need to be improved. In this blog we’ll outline a few key strategies to help you understand and track the health of your business.
Key Metrics To Track The Health Of Your Business
Below are just a few key metrics that can be used to help truly understand the overall health of your business:
• Check Your Income Statement – It’s important to understand your gross profit over a specific period of time. Often business owners should look at gross profit over the last financial year and compare that to previous years. This will help to determine how healthy your business is this year compared to in years past. You can also look at industry averages for gross profit to see how your business compares to others.
• Perform a SWOT Analysis – Another key way to determine the health of your business is by performing a SWOT analysis. This analysis helps to take a look at your company’s internal strengths and weaknesses as well as external opportunities and threats. This helps you to not only keep an eye on your competition but also look at areas that you can improve to position yourself better throughout your industry.
• Analyze Your Balance Sheet – Keeping track of key metrics such as your accounts receivable is paramount to determining the health of your business. If your accounts receivable numbers are growing you could be looking at major problems down the road. Work with your customers to ensure you get paid on time and if necessary, introduce incentives to entice customers to pay early if at all possible.
• Update Your Business Plan – Remember that business plan you created when you first started out? Well, too often business owners forget about their business plan which can be a big mistake. Updating your business plan with key metrics and goals can help you to monitor the overall health of your business from year to year.
Ready To Discuss The Future Of Your Business?
If you’re interested in learning how healthy your business really is, why not give Alice Pallum a call today? Alice offers a free business evaluation that will give you a good idea of the overall health of your business and what areas need improvement. Alice can be reached by phone or text at (612) 799-3991.