How healthy is your business?

Is it fit enough to survive and thrive?

Here are 3 quick and simple checks on the "pulse" of your business.

Get your latest management accounts and make the following simple calculations:

• Take your expected total cash and receivables for the next 30/60/90 days and divide that total by the value of your payables for the next 30/60/90 days:

(Cash + Receivables)/Payables = ??

         The result should be a number greater than 1; around 1.5 is healthy.

• Take your Current Assets and divide by your Current Liabilities:

Current Assets/Current Liabilities = ??

The result should be greater than 1; even better if it's between 2 and 3.

• Take your total sales revenue for the last 3 months and for the prior 3 months and divide each total by the average number of employees you had during the relevant period.

Total sales/No of employees = ??

The results should be the same or, better still, the figure for the latest period should be higher.

If any of your answers are not as indicated above then you may already be headed for difficult trading conditions in the next 30 - 90 days.  You should take a more detailed look at your financial data, urgently.

If you would like help with interpreting the data or in developing a plan of action to improve the health of your business, please contact us today.

It could be the first step to the best investment you will make all year.