The 6 Numbers That Count
To manage your business effectively, you must know the numbers that really matter. These figures are the heartbeat of your operation and reveal whether you are growing or drifting.
Here are the six essential numbers to monitor:
Sales – the top-line measure of activity.
Gross Profit and Gross Profit Percentage – what you make after direct costs.
Net Profit – your true earnings after all expenses.
Cash Balance – the reality of your financial position.
Wages as a Percentage of Sales – how efficiently your team generates income.
Monthly Breakeven (including your salary and dividends) – the point where your business stops losing and starts earning.
Once you understand these, focus on doubling performance over the next 12 months:
Double your ideal customers. Define your target audience and reach them through focused marketing, both online and offline.
Increase transaction value. Introduce premium offerings and review pricing.
Increase transaction frequency. Keep customers engaged so they buy more often.
Boost sales per employee. Measure productivity and ensure every team member contributes to profit.
Track return on marketing investment. Spend more on what works and stop guessing.
Improve your data. A strong CRM system helps identify your best customers and growth opportunities.
Beyond financials, track non-financial indicators like customer satisfaction and delivery performance. They are early warning signs for future results.
Understanding and acting on these six numbers can transform your business performance.
