How Is Your Business Doing So Far in 2022? See Which Metrics to Use

It’s tough to believe that we are already more than half way through 2022. The year is flying by, and the end of it will be here before we know it. Because the year is half way over, now is an important time to reflect and take a good look at how your business is doing so far. Are you where you projected you would be? Are you meeting your shorter term goals? Are you on track for your overall goals for the year?

These are important questions to ask now, because there is still time to make real changes that can significantly improve the course of your business this year. The question is, how can you measure how well your business is doing so far? For that, you need key metrics.

Let’s take a look at a few of them.

Key business performance indicators

Total company revenue - Your financial performance is directly correlated to the growth and success of your business. Look at your income statement, balance sheet, and cash flow. More important than the numbers on their own is seeing if they are trending up or down. See what money is coming in versus going out, and if the trends look good or bad for sales, revenue, and cash flow.

Net profit – This metric is the amount of revenue that remains, as profit for a given time period, after taking into account all of your business’s expenses, taxes, and interest payments during the same period. Look at the percentage your net profit is of revenue to see how you compare to your industry average.

Customer satisfaction – Look at all the reviews, good and bad, you’ve received over the year and even conduct customer satisfaction surveys to gauge the feeling of your customers and keep at-risk customers from going to a competitor. When it comes to surveys, calling tends to receive better results than emails as well as using a third party company to conduct them so your customers are more candid.

Customer retention rate – How many customers are you losing each month? This number, and whether it is trending up or down, is critical to understanding the health of your business. Remember, even if you are retaining 95% of your customers each month, that still means that you are losing 5%. If you lose 5% of your customers each month, then that means you are losing 60% of your customers throughout the year.

Employee performance and satisfaction – Look at the numbers when it comes to employee performance. Are your sales and customer service reps hitting their goals? Are there areas where more training is necessary? In addition to performance, you should also make sure they are happy. The best way to know that is to simply ask and have an honest conversation with them about how they are doing and what their goals are.

How to Make Changes Going Forward

Understanding these metrics will give you the tools you need to improve your business for the second half of the year. If you are having trouble finding the information for these performance indicators, then here are some changes you need to make first:

·??Maintain tight records of daily, weekly, and monthly numbers and financial trends within your organization.

·??Conduct surveys regularly with your customers so you determine issues with your products or processes before those customers decide to go to a competitor.

·??Keep tabs on how your employees are performing and have regular one on one meetings with them (or have managers do that, depending on your company size) to see how they are doing.

If you need help understanding your business’s financials and performance and improve it going forward this year, then my team can help. Click here to schedule a call with me .?

?_________________________________________________________________________

We Offer CFO Services

Whether it’s determining your deductions, cutting your expenses, or implementing strategies to optimize your growth, we can help! My team and I provide services that are customized to the specific needs of your company and your financial goals. Here are some of the virtual CFO services that we offer:

• Timely Financial Reports
• Staff Management
• Staff Training
• Budget Preparation and Monitoring
• Trend Analysis
• Tax Planning
• Organizing Books
• Cash Management
• And more!

See How You Can Optimize Your Business for Growth and Success

?_________________________________________________________________________

?Tune In to Our Weekly CFO Scoop

Don’t forget that I’m doing LinkedIn Lives every Tuesday! Tune in for tips, insights, and best practices around business growth, tax optimization, developing an abundance mindset, and more. Leave us a comment to let us know what topics you’d like to see covered in these weekly lives!