Friday, June 20, 2008

Get the facts: 1st half results are nearly in!

The last week of June starts Monday. Time to prepare the billings that will wrap it up for the first half of the year. Great time to assess your midyear results. Get your books in shape for June month-end. You need to have access to data about your business in order to create a rough forecast of where you'll be at the end of the year.

On the revenue side, run your sample bills. Clean everything up so that June invoices go out in record time. Evaluate your accounts receivable- anything you need to write off? Are there any adjustments to the first half of the year that you haven't made to date?

On the expense side, be sure you're current. Ensure that you've recorded and categorized expenses to the point where you can tell what the outlay covered. If you added staff, be clear about when that salary expense kicked in and how it changed your expense picture. Make a note of any expenses that changed materially over the first six months of the year.

Review your client base. Look at the number of clients you are handling and track when they came on board. You'll want to see the rate of new client business and understand what portion of your first half revenues came from new clients. Be sure you've got an idea of how much of your current book of business will carry over to second half. If you have revenue (or, better yet, profitability) by client- make sure it's up to date.

And lastly, what's your personal income? What have you paid yourself month to month? Put the numbers together.

If you aren't using some sort of management dashboard, this is the kind of data you'll use to put one together. If you have all the information, but you haven't been looking at anything but your bank balance, now's the time to take it up a notch.

Bottom line- end June with a clean and updated set of books and indicators. Take the time (or pay someone else) to collect information that you can use to do some basic analysis and forecasting. Whether or not you have a business plan that you review periodically- you're the CEO, it's time to take a look at the facts.