The Power of Numbers
A few key numbers tell your doctor a lot about you – your age, weight, blood pressure and pulse, maybe your blood sugar and cholesterol levels. Another set of numbers will quickly reveal the current health of your business and provide a good indication of what lies ahead. Develop a dashboard of key figures to keep your business fit and healthy.
Prepare a budget. The process will confirm whether or not your business model is viable and you will have some figures to compare your actual results against. A budget doesn’t need to be pin-point accurate, a rough budget is better than no budget at all!
Revenue. Customers are the life-blood of any business and revenue is how you track them.
Cost of sales. Are you making sufficient gross profit on each sale? Does your pricing reflect changes in input costs? How do your actual figures compare to budget?
Net profit. The ultimate ‘bottom line’! Did you make a profit last month? The question seems blindingly obvious, but too many business operators don’t have a system in place that can accurately answer this question. Invest the time, money and brainpower necessary to establish an accounting system that will provide you with timely, accurate financial information. This will allow you to react to changes in the market, manage your costs and make informed marketing decisions.
Some more key numbers..
In addition to the financial basics, each business has its own set of key numbers – numbers that quickly tell a story. For accommodation providers, that number may be occupancy %, for online retailers – page views and conversions, for builders – requests for quotes.
Do you know yours?
For an overview of key numbers, visit www.786dashboard.com/7-key-numbers/
For Southern Inland regional data, visit www.rdasi.org.au/source
For free workshops on doing business better online, visit www.crde.com.au