In our last blog we talked about the importance of key performance indicators (KPIs) to help grow your numbers. Of course the measures themselves are pointless if there is never any discussion about them.
We promise not to talk Accountanese to you through these blogs so what on earth are KPI’s? Quite simply
In our previous blog we talked about how to drill down and measure your margins. Once you have measured them correctly it’s time to identify ways to improve your margins. With improved margins you don’t have to generate as many sales to get the profit figure you want your business to deliver to you. Better still, if you lift your margins and achieve higher sales, you’ll get even more than you planned on your bottom line!
In the last of our 3-part blog series on knowing your numbers we cover the report that measures the overall worth of your business – the Balance Sheet. The Balance Sheet is arguably the most important report as it measures whether your business worth is increasing or decreasing
Our last blog covered the importance of the Trading Account in giving you a diagnosis of your business health. The next most important report is your Profit and Loss which measures the overall efficiency of your entire business.
The most important step in taking control of your business performance is to understand your numbers. Imagine you are a Doctor and your business is your patient. The financial reports give you the symptoms of the good or poor health of your business. Having a good understanding of the reports enables you to pinpoint areas that require a more detailed diagnosis.
I’m sure you’ve heard about the need to work ‘on’ your business as well as working ‘in’ your business. But have you ever stopped to think what exactly you should be doing?
If you’re looking for new work, follow this very simple model; not only will you get more clients for way less marketing spend; you’ll be improving service to existing customers too.