There is a slowdown in the commercial building and housing markets in Australia and some significant mining companies and manufacturers are laying off staff. Two major motor vehicle industry finance companies have announced that they are withdrawing from the Australian market. Retail trade is down – some major stores ran “Special Sales” in November. We are in tough economic times!
• How does all this relate to your business?
• Are your sales up or down?
• What is happening to costs?
• Are you analysing your gross profit percentage on various products and services?
• What is the wages to turnover percentage in various departments or product lines in your business?
• Have you monitored theft & pilferage within the business?
• Have you identified wastage areas within the business?
• How does the net profit percentage compare to that achieved in previous years?
• Have you calculated the gross income per employee and compared that to other similar businesses?
• Is your business growing market share, or is the increased activity the same as what is happening in other businesses similar to yours because of the economic activities in your area?
• Do you think you are getting your fair share of new business?
• Is your business creating value that is appreciated by your customers?
• Have you benchmarked your business’ performance against others in the same industry?
• Are you able to provide prompt accurate current trading and KPI figures to your bank or lender?
A detailed business diagnostic looking at the various questions that have been raised will assist you to analyse your current performance and to determine how you are going to perform in the longer term, especially in an economic downturn.
Article by Christie Lewis
Christie is Practice Manager at Alan Lewis Accountants . Besides accounting, her passion is for all things small business (and blogging, of course). You can contact Christie directly at christie@lewistaxation.com.au.
Christie has written 811 awesome articles for us at Alan Lewis Accountants – BLOG
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