How Have You Done So Far? Take Our Business Health Check Exercise

business-health-check

When was the last time you had a stock-take of your business? Are you about to do a strategy review for your business? Here's an exercise to quickly allow you to take stock of your business, take our business health check exercise and see how you are doing:

Take stock of your business achievements, your resources and current market position, before you decide on your future direction. Do this (very) regularly.

Recommended download: Analysis of the Company Model Spreadsheet

Business Health Check Exercise

Financial metrics

Financial

Last year

Previous year

Sales

 

 

Gross profit

 

 

Net profit

 

 

Your own salary

 

 

Total promoters/management team remuneration

 

 

 Customer Metrics

Customers

Last year

Previous year

Number of customers

 

 

Average purchase per customer

 

 

Average purchase per customer — units of product/service

 

 

Sales Metrics

Products/services

Last year

Previous year

Percentage of total sales accounted for by each of the business’ top three products/services:
• Product/service 1
• Product/service 2
• Product/service 3

 

 

Number of products made/hours of services supplied for each of the business’ top three products/services:
• Product/service 1
• Product/service 2
• Product/service 3

 

 

Average cost of each unit of product made/cost of service provided per hour
for each of the business’ top three products/services:
• Product/service 1
• Product/service 2
• Product/service 3

 

 

Financial Metrics

Assets and liabilities

Last year

Previous year

Fixed assets

 

 

Cash

 

 

Stock on hand

 

 

Money due by customers

 

 

Money due to suppliers

 

 

Less Borrowings

 

 

Total Net Worth of Business

 

 

Equity contributed by promoters and management team

 

 

External equity

 

 

(External equity as a % of total equity)

 

 

Profits retained

 

 

Total Shareholders’ Funds

 

 

 Other Metrics

Other measures

Last year

Previous year

Number of staff (including promoters and management team)

 

 

New products/services introduced

 

 

Percentage of total sales accounted for by new products in first year

 

 

New customers won

 

 

Percentage of total sales accounted for by new customers in first year

 

 

Can you break down your sales:

By Product/service?

Product/ Service

Sales last year

Past growth: Good/poor?

Margin last year?

Prospects: Good/poor?

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

By Customer type?

Customer type

Sales last year

Past growth: Good/poor?

Margin last year?

Prospects: Good/poor?

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

By Region?

Region

Sales last year

Past growth: Good/poor?

Margin last year?

Prospects: Good/poor?

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

On a scale of 1 to 10 (10 being very important or good performance), which of the following factors are important in your market and how is your business performing with regard to them?

 

Importance in market

Performance of business

Product features (specify what these are)

 

 

Quality of products

 

 

Range of products

 

 

Customer service

 

 

Marketing

 

 

Price

 

 

Location

 

 

Delivery

 

 

Image

 

 

Other (specify what these are)

 

 

  • Why do your customers buy from you? How do you know this?
  • Are you capable of meeting quick changes in demand?
  • Are your suppliers able to help you to meet sudden changes in demand?
  • Are you dependent on one major supplier for any of your top three products/services?
  • Are you dependent on one major customer for sales of any of your top three products/services?
  • How do you keep informed of new developments on your industry?
  • How do you implement those new developments?
  • Are you developing new products/services?

How do the promoters and management team spend their time (week/month), on average?

 

NAME/TITLE:

NAME/TITLE:

NAME/TITLE:

NAME/TITLE:

NAME/TITLE:

HOURS

HOURS

HOURS

HOURS

HOURS

Sales

 

 

 

 

 

Production

 

 

 

 

 

Meeting customers

 

 

 

 

 

Administration

 

 

 

 

 

Doing/learning new things

 

 

 

 

 

Other activities (specify what these are)

 

 

 

 

 

Total

_____________

_____________

_____________

_____________

_____________

Why is your business successful?

However you measure success, how would you measure your business on a scale of 1 to 10 (10 being very successful)?

This exercise sets the current scene for your business and identifies the starting point for your journey of growth. Completing it improve your understanding of your own business and perhaps helped you to look at your business with new insights.

Over to you now. Did you find this business health check exercise useful? Tell us in the comments below. 

 

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Saturday, 20 April 2019
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