What are the numbers that really matter to your business?
Lots of people get hung up on sales (which are important), but if your business has a low profit margin then you are putting in a lot of work to increase profits.
For example, if you have a 10% margin (so you spend £90 to get £100 of sales) then to double profit you must double sales. But you could also double profit by increasing your prices by only 10% or reducing costs by 11%. These may be a lot easier to achieve. Or they might not. It will be different for everyone.
The point is that the things that drive your business forward are not the same as those that drives someone else’s. And they may very well not even be financial measurements. Do you regularly measure customer satisfaction or employee happiness? They are often pointers to a thriving business as happier employees make for better workers, looking after customers better, making them to want to come back more often, buy more and pay higher prices.
The main problem is that key indicators (performance – backward looking) or (predictive – forward looking) need to be found; they don’t come with labels attached.
But it’s a hunt worth going on and will bring far greater rewards than hunting for Pokemon on your iphone.
Have a great week
Paul