The Magic’s In The Numbers!

So much can be learned from the numbers!??

Tracking different types of sales is useful information when examining where you do well, and where your sales are soft.??

For example, you may have had a record sales year.? But when you examine your numbers you discover your Boot Camp brought in 80% of the income as opposed to only 20% of your income coming from personal training.? What does that tell you???

Should you stop offering personal training and add another Boot Camp, or was your personal training low because you really didn’t market it that well???

Now let’s throw another calculation into the equation.? Suppose even though your Boot Camp is 80% of your sales revenue, it accounts for only 20% of your profit?? And the reverse is true for Personal Training - 20% of gross sales, but 80% of your profit.? Easy answer there – increase your personal training!

When business planning, you always want to grow the area of your business that brings you the highest return.? However, you need to consider trends.? Virtual training may have flourished during lock-down, but will it continue to be popular when people are no longer confined to their homes?? This may seem like crystal ball gazing, but if you keep up with industry news, and reach out to peers in your industry, you can likely make a value judgement on the direction of your industry over the next 12 months.?

Remember, the ability to analyze your numbers requires you to have kept your numbers compartmentalized.? For example:

SALES

• Membership Dues
• Personal Training
• Boot Camp
• Nutrition Consultation & Products
• Package Promos

Be sure to separate your expenses as well so that they align with the sales categories and can be tracked to the cost of sale by category.??

By doing this you will be able to arrive at a gross profit number by category.? For example if you are providing the personal training.? Track your hours and assign an hourly cost to your time.? On the other hand, if you employ someone to handle all the personal training, make sure that person’s salary is directly attributed to the personal training income.??

If that same employee also runs the Boot Camp, you will need to track how many hours are spent on each category and assign appropriately.? Ie:? 30 hours on Boot Camp, 10 hours personal training.? Total of 40 hours with Boot Camp accounting for 75% of the time and personal training 25%.??

If you provide nutrition counseling and sell nutritional products as a part of a nutrition program, be sure the costs associated with that are kept together.? Same is true for all other divisions of services/products you provide.??

If you use QuickBooks you can track this through your personalized chart of accounts, and if you want to be able to run completely separate P&L Statements for each division of your business you can utilize the “class” function.??

At the end of the day, you want to be able to look at the profit margin of each category of business so that you can determine how each category is performing.

General and administrative costs like rent, utilities, bathroom supplies, towels etc. can be tracked as general costs.? It would only be necessary to break out the cost of an item like this if it were very specific to a division of your company.? Let’s say for example rent.? If you were only renting a facility for your boot camp and all other functions of your business were operated from a home office and in-client home or virtual training then the facility rent would need to be categorized specifically as a cost of doing business for the Boot Camp division only.

For me, this type of analysis is super fun.? It tells you so much about your business and will help you plan for the future and maximize your sales.? If you aren’t currently tracking your numbers you are shooting in the dark when it comes to sales planning and forecasting.

If you would like a copy of my Resource: A Free Guide to Wrapping Up the Year and Preparing for the Year Ahead

Direct Message me through LinkedIn with your email address so that I can get it off to you.

Wishing you lots of fun number crunching!

-Claire

https://www.dhirubhai.net/in/fentonclaire/