You’ve made it to the middle of the year and it’s time to start evaluating your finances to get you ready for the coming months. If you created goals at the beginning of the year, you should be turning to your numbers to make sure you are on track.
It’s a simple task that is often overlooked but can be the difference between a successful remainder of the year or failing to reach the achievements you hoped your business would reach.
To ease some of the stress that comes with this task, we’ve put together a list of questions so you can be sure you’re covering all of your bases when you check in on your annual planning.
Is Your Budget on Track?
Your budget affects many of your reports and planning, including cash flow, forecasts, and your strategic plan, just to name a few. Because of its weight on your finances, it’s incredibly important to track your budget regularly, and especially at the mid-year point.
A good way to do this is to cross-check your proposed budget with your actuals. Look for areas you were off and then take a more detailed look. Ask yourself questions like:
- Were my estimates off? If so, where did I make a mistake?
- Where am I overspending and was it justified?
- How can I refrain from overspending in places it wasn’t needed?
- What area(s) did I underspend? Can I allocate the extra funds somewhere else?
Once you’ve asked yourself each of these questions and given it an extensive review, you’ll be able to make adjustments to your budget to better align it with where it needs to be for the remainder of the year.
Are You Close to Your Sales/Cash Flow Goals?
Using your forecast to check your sales/cash flow goals is the easiest way to see if you are on track. If you made a good forecast, you should have multiple scenarios based on the market that provide well-thought-out predictions of your sales/cash flow while also keeping your business goals in mind.
- Note: If you didn’t create a forecast at the start of the year, you should consider doing so at the beginning of the year ahead. It’s a great tool for creating a successful financial plan.
From here, use your forecast to compare your sales and margins to where you thought they would be at this time of the year. If they are on track, great, keep doing what you are doing. If they aren’t on track, figure out how you can get your numbers trending in the right direction.
If you are making your review and realize your predictions were off to the point where adjustments still won’t allow you to reach your goals, tweak your sales goals for the remainder of the year. There is no harm in doing this as forecasts are rarely 100% accurate and should be thought of as more of a guide rather than something set in stone.
If you didn’t get around to making a forecast this year, you can follow the same steps by comparing your current sales and margins to last year’s numbers. When you do this, you are likely looking for similar or better results because this would imply you are performing at the same rate or have improved since last year.
What About the Rest of Your Company KPIs?
Once you’ve reviewed your budgets and forecast, you need to take a look at your other KPIs to see how well they are performing. These are typically non-financial metrics and because they are growth-focused as well, their results are just as important. Here are a few non-financial KPIs you should be tracking:
Team metrics
- Headcount
- Communication/collaboration
Lead Generation
- Conversion rate
- Length of conversion (buying cycle)
Operations/Growth Metrics
- Lifetime value (LTV)
- Customer acquisition cost (CAC)
Customer Service and Support
- Response time
- Resolution time/rate
- Net promoter score
KPIs that fall into the categories of team metrics, lead generation, and customer service and support heavily influence the success of your sales and business as a whole. If these metrics aren’t performing well, you may also see underperforming sales. At the mid-year point, it will benefit you to review these areas and make adjustments to improve.
Caught Up on Tax Payments?
It’s never too early to start thinking about your taxes. Tax payments can sneak up on you and if you aren’t handling them properly, they can have extremely negative effects on your expense reports. Here are a few pointers to help you stay on track with your tax payments:
- If you are paying too much: Send a smaller payment for Q2. This will improve the cash in your accounts.
- If you are paying too little: Go back to your budget and look for areas you can pull from to catch up on payments. Try not to break the bank by making tax payments.
- Look into your potential expenses: To see if you are eligible for any advantageous deductions.
- Do some research into tax credits: There are plenty you may qualify for, and now because of the effects of the pandemic, there are even more.
Don’t let tax payments be the reason you don’t reach your year-end goals. Make sure you are checking regularly, and especially at the mid-year mark, to see if there are any adjustments that could be made.
Time to Check-in With an Expert?
If you’ve been making mid-year check-ins on your budget, sales/cash flow goals, non-financial KPIs, and tax payments all on your own, it may be time to turn to an expert. They can help you:
- Compare your budget to actuals and make suggestions for improvements
- Work with you to edit or create a forecast focused on growth
- Ensure you are tracking the right KPIs
- Help you make tax payments that won’t negatively impact your financial state
- Answer any questions you may have
Because forward-looking matters, Pasquesi Partners is the perfect choice for all of this, and more. You can schedule an appointment today to learn more about the many ways Pasquesi Partners can help you drive growth.