We believe that business owners can really benefit from having a real-time view of their finances.
Our services take care of the financial admin so that you can have a real-time view of your finances, however in this blog we thought we’d let you know of 5 performance areas that you can easily track to help your business grow.
Not every business is set up the same, so the suggestions below are just guidelines that will work for some.
We’ve put alternative options for others things to track that might suit your business in each section.
We hope they help!
Amount Of New Customers
The first step to tracking your business performance is growth: how many new customers / clients are you getting each month.
It’s up to you how thorough you want to track this figure, for some businesses monthly will be enough but for others you’ll want to know how many new customers you get on a daily basis.
This will simply show you, how your business is growing and reaching a new audience.
Amount Of Returning Customers
An often overlooked aspect of a growing business is the ability to retain customers.
If you track the amount of returning customers / clients, you’ll be able to see how stable your business is and understand whether you are meeting their needs.
A customer kept, is just as good as getting someone new on board!
Amount Of Departing Customers
If you’re bringing in 100 new customers every month, but losing 99 of them the following month your business won’t be as successful as it seems at first glance.
Tracking any clients or customers that are ceasing to buy from your business, will help you to see a true value of your businesses growth.
Amount Of New One Off Payments
Tracking customers is just one aspect – you need to understand how much value a customer / client brings to your business.
You could have 100 new customers a month, but if they all only spend £1, that won’t be enough to keep your business afloat.
By tracking how much each of these new customers / clients pay in one off payments, you’ll begin to get an insight into the value of each customer and the average spend – another helpful piece of data when considering your growth.
Amount Of New Recurring Revenue
Some of the best business models will have some form of recurring revenue, ensuring that you can expect a set amount of money each and every month.
Subscription models are usually the best way to achieve this. So begin tracking how much new subscription revenue you have on a monthly basis.
This precious data will help you forecast your businesses growth over a period of time.
The Numbers Become Fun
These heading should leave you with these 5 considerations:
- How Many Customers Are New?
- How Many Customers Are Returning?
- How Much Income Is From New One Off Payments?
- How Much Income Is From New Recurring Revenue?
- How Many Customers Are Leaving?
Once you’ve got all of this data you’ll be able to take the total amount of income and deduct the figure of those leaving.
You’ll also be able to see trends:
– Which months are most busy?
– Which months do customers seem to leave?
– How much income is your business making on average month to month?
– What is your average new customer acquisition cost?
In short – the possibilities are endless! The numbers actually become fun!
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