In my last blog I discussed the tools to make this evaluation with your business financials. Once you have collected the data and reviewed it, get a second opinnion. It is best if you have a CPA outside of your business to review your figures and complete your tax return annually at a minimum – use their expertise to tell you what they see in your numbers. Having the number story told from a different perspective can be very valuable.
Goals, where do you want to be and how do you create goals that work from a financial situation?? (The answer is WE NEVER KNOW!!!)
Work with your history first if you have it. You can ususally say that they will hold true, or may go up or down ___% due to the econonmy or some change you are making in your business.
Once that type of goal setting or budgeting holds true – try forecasting along side of it. What is possible. Do your research, be sure you know what your costs are, know how much money you can spend on any given thing, then be sure to have your profit margin built into your sales price.
You will see trends, recognize them (successes or failures), apply that knowledge, make adjustments and move forward. Learn to trust your numbers – they are like reading a self help book – the information is there, it is all in how you use it that makes the difference.
Get intimate with your numbers each month – the goal is to watch them grow !