Over half the year is through, so it’s time to analyze your business performance.
If you set a goal for the business in terms of revenue, how are you doing in relationship to that figure? If you are exceeding your goals, how will this impact your taxes? Do you need to alter your estimated tax payments (if you currently have to file) to avoid owing a large amount later? Do you need to make equipment purchases or invest in other larger expenses you’ve been postponing to offset your profits? Of course, talk to your CPA before making this decision to see if now is the best time to spend those dollars.
But maybe you’re finding that you aren’t on track to meet your goal. This can be due to sales lower than expected, costs higher than expected, or a combination of the two. Contact vendors to see if you can get a discount for paying more quickly, see if there is a way to run a process more efficiently (and therefore reduce the time or costs associated with the task) or see if the rates you are charging for your products and/or services are too low and need to be increased. Based on how far off your goal you are, you may want to look at your estimated tax payments and see if those can be reduced to keep more cash on hand. Schedule an appointment with your CPA to review your financial statements and determine if any changes should be made.
If you’ve been too busy to do your bookkeeping and you don’t have this information handy, it may be time to consider partnering with a bookkeeping company to assist you. They can keep your records up to date and allow you to analyze where you are in relation to your goals.