A Mid-Year Checkup For Your Business Finances

Mid-year, what do you mean? I just got used to writing 2012 as the date! The year just started! No my friend, it’s May, and it’s time for you to take a look around at your business and figure out where you’re at. And one of the most important areas to inspect is your financial health!

But, where to start your investigation? And, how do you fix anything that needs restructuring? If you had New Years’ resolutions to get your money in order in 2012, you’re six months away from not being able to check off that box, so let’s get started!

Dealing With Debt

Whether you took a loan from a bank or borrowed a handful of cash from your cousin’s best friend, you just might owe some dough to somebody who helped you get your business off the ground. However, during the course of doing business, you may not realize you can now afford to pay even more a month.

Even if your lender or benefactor is incredibly forgiving, you want to get rid of all debts as soon as possible. It just looks better on paper if you’re making pure profit instead of owing several thousand dollars. It especially looks good to parties interested in buying your company or investing in it.

Try to restructure your finances to where you’re paying off a little more per month. It doesn’t have to be a lot, but enough to get you on your way to debt freedom.

Run Your Finances More Like Your Great Aunt Mary

Remember your Great Aunt Mary? She’s the one who still thought candy cost a penny and movies were a dime. She wouldn’t know, though, because she never bought candy and didn’t go to “the show.” Why? Because to her, saving every single cent possible was the key to finances.

Of course you can’t run a business completely like this. You have to spend money once in a while in order to make more money. However, keep your Great Aunt Mary in mind when it’s time to buy a new computer or order more paper. Do you really need to upgrade to the high quality paper if you’re just printing work orders?

Be as vigilant about your money as possible. Before you make any big (unnecessary) purchases or forget to turn off your lights for the night ask, “What would Great Aunt Mary say?”

Figure Out Your Worth

It boils down to one simple question: Are you charging what you’re worth? What your products are worth? Don’t just think of the cost of materials to make your products, think of the labor it took to create them, the brainstorming sessions it took to come up with them in the first place, the years it too you to master your handcrafting the skills, the packaging and shipping costs to get them to the customer, the computer you need to list and retrieve orders… the list goes on.

Is your business thriving or are you merely charging enough to survive? If you have a sinking feeling in your stomach that you are stuck in survival mode, check out Tara Gentile’s The Art of Earning. Because you’re worth it!

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Main image courtesy of 401K