There are many tools available for business owners to use in analyzing the performance of their business. The ones discussed in this document are certainly ones which financial institutions use to analysis the credit worthiness of companies. Your CPA should be your first stop as they are the experts.
Here are a few for you to consider:
The first example is a S.W.O.T analysis. This tool allows you to consider the Strengths, Weaknesses, Opportunities and Threats in your business. How many business owners have gone through this process? It is recommended as it can and will challenge your thinking around your business, and what changes you may need to make to drive your business further. Markets and opportunities change continually and you need to stay up to date.
There is the break-even analysis. As a business owner have you ever done the exercise of determining what your breakeven numbers looks like? It is important, and once done, it becomes a benchmark for improving your profitability.
There is of course the core business plan. This should be breathing, living and every changing document based on the ever-changing needs of your business.
Inventory turnover analysis, accounts receivable analysis, etc., are other tools which may come into play depending on your particular business.
All of the above are key tools that are useful either for specific situations or ongoing management, and they are just a few for you to consider.
It’s your business, your time, and your money invested and you want to use everything at your disposal to help your business succeed.