Mid-Summer Planning: Turn Your Review Into Action
In the first article in this series, we covered the numbers behind a mid-summer financial review, including budgets, profitability, cash flow, and accounts receivable.
Once you understand where the business stands, the next step is deciding how to use that information. These three areas can help shape your plan for the rest of the year.
Review expenses and recurring commitments
Take a close look at where your money is going. Review subscriptions, software, services, and vendor contracts. Some may no longer support the way your business operates. Small monthly expenses can also add up over time.
Compare vendor pricing and consider whether staffing, equipment and other costs still match your current needs.
Avoid cutting expenses without considering the effect on customers or employees. Focus on spending that no longer supports your priorities.
Update your tax planning
Don’t wait until tax season to find out what you owe. Review your year-to-date income, estimated tax payments, payroll records, and major purchases with your accountant. Changes in profitability may affect estimated payments and your year-end tax position.
You may also need to discuss:
- Equipment purchases
- Retirement plan contributions
- Owner compensation
- Business structure changes
- Other decisions with tax consequences
Planning during the year gives you more options. After December 31, some opportunities may no longer be available.
Revise your goals for the rest of the year
Use your mid-summer review to set priorities for the next several months. Your original goals may still make sense, or the numbers may point you in a different direction. Update revenue targets, hiring plans, spending decisions, and cash reserves based on current results.
Choose a few measurable goals and assign responsibility for each one. Review progress monthly so concerns can be addressed early.
Keep the plan workable
Mid-summer planning should help you understand what has happened, decide what needs attention, and make realistic changes while there is still time.
Start with the financial review covered in the first article [link]. Then use those findings to guide your spending, tax planning, and year-end goals.
Your accountant can help you review the details, identify concerns and create a realistic plan for the rest of the year.
