Financial Ratios Analysis is a way of determining the health of a business. Just as a doctor might take your pulse, temperature and blood pressure to give information on your health, we use Financial Ratios Analysis to identify weaknesses of your business.
Financial Ratios Analysis is an important tool for small business owners to measure progress toward reaching their business goals, as well as toward competing in the market. Financial Ratios Analysis is a useful tool that will provide key indicators of your business performance. Business owners use Financial Ratios Analysis to identify weaknesses from which corrective action can be taken.
The ratios presented below represent some of the standard ratios used in business practice. We can also develop your own ratios and indicators based on what you consider important and meaningful to your business and industry:
- Operational Efficiency Ratios
How efficiently are you utilizing your assets and managing your liabilities?
- Profitability Ratios
How well is your business performing over a specific period?
- Liquidity Ratios
Does your business have enough cash on an ongoing basis to meet its operational obligations?