If you’re smart, you get occasional medical check-ups even if you’re feeling OK. There are many diseases and disorders that don’t announce themselves loudly until treatment is difficult.
Same goes for your franchise’s finances. Things may seem “fine.” But will your franchisor have the same assessment? Are you meeting the goals and expectations established for you?
Like your physical health, your fiscal health may have trouble brewing that you need to know about now. You may be, for example:
- In debt to the federal government and state taxing agencies (estimated taxes).
- Nearing a financial crisis that may require outside funding.
- In debt to your suppliers.
- Too far off your budget projections.
- Overspending in ways that will soon become evident.
- Bringing in less money than you did at this time last year.
- Way off from your 2017 financial goals.
What You Might Discover
Clearly, you need a financial checkup now -– while you can get back on track before year-end. On the bright side, it may be that you are in good shape. In that case, you might want to defer some income or donate to charity so you can minimize your 2017 tax obligation.
On the other hand, you may learn that it’s a good thing you decided to have that check-up because your finances are in rough shape. Time to take some action before you ring out the year.
You’ve Got Time
There’s still time make corrections, some of which you can do on your own. You can create reports. This will be quite a challenge if you’re using a manual system for your franchise’s accounting. If you’re using an online accounting application, you can create them in seconds. Here are questions you’ll need to answer:
- How much money have you sent to the IRS and state agencies for 2017?
- What are your actual income and expenses compared to what you budgeted?
- Where are your expenses going?
- What if your customer traffic takes a hit? How long would your cash reserves last?
- What is the state of your inventory?
What 2017 goals did your franchisor define for you? You’ll need to look at them again and evaluate your progress. What do you need to accomplish before 2018? Will you need to buy new equipment? Do you have a seasonal franchise, so you’re about to incur extra payroll costs? Can you estimate your income and expenses from now until New Year’s Day?
Corrections Take Time
We strongly recommend that you start this process now. You’ll need time to make any necessary corrections. 2017 will soon become 2018, and there’ll be an entirely new set of numbers to consider.
If your franchisor doesn’t have a preferred accounting application, we can get you started on one that makes sense for you. We can meet with you and do a financial checkup using specialized tools that will indicate what you need to do before 2018. Let us help you keep your franchisor happy with a positive finish to 2017. Contact your MarksNelson professional at 816-743-7700.