RKL: Give Your Business a Check-Up with These 10 Questions
Just like annual physicals help us keep tabs on overall health, periodic reviews of a business can give owners a comprehensive sense of how things are going. It is easy to postpone such a task in favor of day-to-day tasks or shorter-term goals, but investing the time and attention to consider the below questions will pay off in the long run.
A full perspective of performance and operations not only helps keep your business on a successful path; it is also useful information for a meeting with a bank or a new customer/supplier relationship. Answering the below questions with the support of a business advisor like RKL will give owners a good handle on their business’ financial and operational performance.
- What is my company’s customer concentration?
- Which customer relationships are most profitable?
- What is the quality of my company’s earnings?
- What is gross margin by product line and service offering?
- Are we generating adequate cash flow from normal operations?
- Do we have efficient asset management and turnover (accounts receivable and inventory)?
- Are we generating the right types of financial and operational management information?
- Are management reports distributed in a timely manner and is the information used to support decision-making?
- What are the key business relationships and how do we protect them?
- What are our greatest vulnerabilities and how do we mitigate them?
These questions can provide a baseline of business performance, help you address challenges and uncover opportunities for growth, but it is important to customize these periodic assessments to your company’s unique circumstances. Ready to conduct a check-up on your business? Contact me at the e-mail below to start the conversation.
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John S. Stoner, CPA, CVA, is a Partner in RKL’s Business Consulting Services Group. John has more than three decades of public accounting and advisory experience across a wide range of industries including healthcare, advertising, manufacturing, professional services and not-for-profit entities. He can be reached at jstoner@rklcpa.com.
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