Many small business owners take stock of where they stand 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, take advantage of immediate opportunities, and ensure that your business is on target to meet year-end goals.
June is the ideal time to review your business plans and financial spreadsheets, assess your current situation, and course-correct where necessary in order to build on your strengths and minimize weaknesses. Here’s how to complete a mid-year review in six simple steps:
1 – Revisit your annual goals.
It’s easy for small business owners to get wrapped up in the day-to-day of running their businesses and lose sight of the big picture. Reviewing your annual goals every six months allows you to see exactly where you are versus where you planned to be.
If growth has been slower than expected, 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 the objectives you set in January are no longer relevant. Regardless of where things stand, now is the time to celebrate your team’s accomplishments to date, reprioritize your goals, and create a new plan for how you will achieve them.
2 – Get your finances in order.
Examining your business finances will give you a clear understanding of what you need to focus on in the next six months to either 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 in the months ahead, as well as simplify year-end tax preparation and ensure that you are maximizing small business deductions.
3 – Reconsider your product or service mix.
When conducting a mid-year check-in, be sure to take time to evaluate your products or services with an eye towards where you can add value to current customers as well as how you can attract new ones. Zero in 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 weak spots or shift gears now to help avoid a negative impact on year-end results.
4 – Check in with 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.
5 – Evaluate your insurance coverage.
Having 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. Keep in mind that your business may change over time. 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 to update them.
6 – Meet with your tax professional.
A good accountant can not only save you money, but they may be a valuable resource when it comes to making critical decisions that impact your short- and long-term business goals. Although tax season is a long way off, it’s a good idea to meet with your tax professional 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, take the time to reexamine your calculations and make any necessary adjustments.
Your tax professional can also identify any opportunities to 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.
Whether summer is your busiest time of year or your slow season, it is important to assess what you’ve accomplished and resolve any issues that have developed during the past six months. Carving out time to look “under the hood” will help ensure that your small business runs at peak performance throughout the rest of the year.
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