We’re approaching the halfway point in the year. Now is a great time to take a step back, assess where you are and make the adjustments you need to hit those goals you set earlier this year. It’s time for a mid-year business health check.
Instinctively you may know where the shortfalls are. But take the time to evaluate all areas of the business before you start changing direction and re-allocate resources – time and money.
Here are some questions I use with clients to identify areas that need improvement or uncover opportunities to exploit. Answer some of these — then compare it to last year and/or the goals you set for this year.
Business Health Check
Revenue Mastery
- Are sales higher than the same period last year? By how much?
- How many new customers did you get?
- What is your average transaction amount?
- How many quality leads are you getting each month?
- What is your sales conversion rate?
- Have you lost any customers? If so, how many (and why)?
Product/Service Mastery
- How are sales of new or repackaged products/services performing (if applicable)
- What is the mix % for your key products/services? Are there any significant changes?
Operational Mastery
- What is your revenue and gross profit per employee?
- What is your labor as a % of sales?
- Are customer satisfaction or feedback scores improving?
- What is your quality % to date? Note: this reflects reworks or rejects
- What is on-time delivery % to date?
- How many customer complaints? What is $ value and % resolved by front-line employees?
- What % of how-to-manual is complete?
Team/People Mastery
- What, if any, employee turnover has occurred?
- Do all positions have a backup or ready replacement (cross-training)
- Do you have the right people to get the results you want? What skill-gaps, if any, exist?
- Do you have the right suppliers (and backup) to meet your needs? How do you measure success?
Profit / Financial Mastery
- What are your gross profit margins (%) to date?
- Has cumulative cash flow for the year been positive?
- Is your operating margin or EBIT higher than last year?
- Is your business debt higher, lower or the same when compared to last year?
Once you identify the gaps or opportunities, set priorities based on what is most critical for your business success. Next, identify what you need to do (the actual tasks) to improve the results. Then start implementing!
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