Am I trending up or down over the last 6 months?
A single month can be misleading. You need at least 6 months to see a real trend. Here's how to figure out whether your business is genuinely improving or quietly declining.
The short answer
Are you trending up or down? Look at your revenue, net margin, and cash position over the last 6 months. If all three are moving in the right direction, you are genuinely trending up. If revenue is up but margins and cash are down, you are growing unprofitably, which is a downward trend disguised as progress.
One good month can hide a bad trend
March was your best month in a year. $105K in revenue. You celebrated. But looking at the 6-month picture: October $88K, November $82K, December $71K, January $78K, February $84K, March $105K. The average over that period is $84.6K, and four of those six months were below $85K.
One strong month does not make a trend. And one weak month does not mean disaster. You need the 6-month view to separate signal from noise. Is the business genuinely getting stronger, or did you just have one good month in an otherwise flat or declining trajectory?
The trend also matters more than the absolute numbers. A business doing $80K/month and growing 5% per month is healthier than one doing $120K/month and declining 3% per month. Direction matters more than position.
How to chart your 6-month trend from your existing data
- 1Pull 6 months of P&L data
In QuickBooks, run Profit and Loss for the last 6 months, grouped by month. In Xero, use 6 comparison periods. Note Total Income, Total Expenses, and Net Income for each month.
- 2Calculate net margin for each month
Net Income divided by Total Income for each month. Are margins improving, stable, or declining? This is often more important than the revenue trend.
- 3Check your cash position trend
Run Balance Sheet as of the last day of each of the 6 months. Note the bank balance. Is your cash growing, stable, or shrinking? Cash is the ultimate reality check.
- 4Check your pipeline and lead trend in your CRM
Pull monthly deal counts and new lead counts for the same 6 months. A declining pipeline today means declining revenue in 60-90 days.
Total time: about 30 minutes. You need 6 months of P&L data, 6 months of balance sheets, and CRM pipeline data.
Update your trend view monthly so you always have the latest picture
Each month, add the new month's data and drop the oldest month. This rolling 6-month view is the best single tool for understanding your trajectory. It smooths out monthly noise while still being responsive to real changes.
Or see your 6-month trajectory updated automatically
Bottomline calculates your trend across revenue, margins, cash, and pipeline every month. It shows you the direction and magnitude of each trend so you know at a glance whether the business is improving, flat, or declining.
You see the full trajectory in one view. No charts to build, no spreadsheets to maintain. Just a clear answer: are things getting better or worse, and which specific areas are driving the change?