Many small business owners conduct reviews at the beginning or end of the calendar year. However, checking your progress at the halfway point can help you spot and resolve issues with systems, processes, or products, jump on potential opportunities, and ensure that your business is on target to meet year-end goals.
While it may be tempting to take a vacation from reviewing business plans and financial spreadsheets, June is the perfect time to do a mid-year check-in to assess your current situation and course-correct to build on your strengths and eliminate weaknesses.
Assess your goals.
It’s all too easy for small business owners to get wrapped up in the day-to-day of running their businesses and lose sight of big picture goals. Reviewing your annual targets every six months allows you to take stock of where you are versus where you planned to be. Growth may be slower than expected, so you may need to adjust your projections to something more attainable. You could be having a banner year and decide to set higher targets to keep the momentum going. It’s also possible that circumstances have changed so dramatically that objectives you set in January are no longer relevant. Rather than wait until the end of the year, celebrate your team’s accomplishments to date, reprioritize your goals, and focus on how to achieve them.
Run the numbers.
Reviewing your business finances is critical in order to know where you stand and what you need to do to stay or get back on track. Check year-to-date sales figures against projections, examine income and expenses, and determine where to make adjustments. Getting your finances in order midway through the year will help you manage your budget and cash flow over the next six months, as well as simplify year-end tax preparation and ensure that you are maximizing small business deductions.
Evaluate products and services.
When conducting a mid-year checkup, be sure to take time to evaluate your products or services with an eye towards where you can add value to current customers and how you can attract new ones. Focus on your company’s strengths and how you can leverage them to grow revenue. Consider whether or not it’s time to eliminate products that are underperforming or service lines that are not contributing to your bottom line. Shore up any glaring weaknesses or shift gears now to help avoid a negative impact on year-end results.
Consider your customers.
It’s important to take stock of your customer relationships on an ongoing basis and address problems or issues as quickly as possible. Reach out to satisfied customers or clients through regular surveys to help better understand how you can improve your brand and your service. Make sure you acknowledge the valuable feedback you receive, and incorporate it into your customer service strategy. If clients have outstanding orders or unresolved complaints, take immediate action to correct the situation. Even the most loyal customers will lose faith in businesses that fail to deliver on what they promise.
Meet with your accountant.
A good accountant can save you money and be a valuable resource when it comes to making critical decisions that impact your short- and long-term goals. Tax season is a long way off, but it’s a good idea to meet with your accountant now to review your current tax reporting and discuss any necessary changes. Many small businesses pay estimated quarterly taxes mid-month, and it’s important to determine if your revenue has increased since your initial projections as this may impact your tax liability. To avoid incurring underpayment penalties, invest the time in reexamining your calculations and making any necessary adjustments.
Your tax professional can also identify opportunities to help you reduce taxes between now and the end of the year. These include deferring income, pre-paying expenses that can be deducted from your business income, and taking advantage of deductions such as purchasing eligible business equipment.
Review your insurance policies.
Obtaining the right type and amount of insurance to protect your organization and employees will help you avoid gaps in coverage where you need it most. It’s a good idea to review your policies regularly to ensure that your coverage continues to protect your assets. Remember that your business may change over time, so, if you have moved to a new building, increased revenue, hired new employees, or added services or products, it’s possible that your policies don’t fully cover you. Consult with your insurance agent to determine whether you need an update.
A mid-year check-in can help you identify and resolve issues that have developed during the past six months and position your small business for optimal performance the rest of the year.
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