There are two types of business owners in this world:
1) There are business owners who LOVE talking numbers and data…
2) And there are business owners who’d rather bash their head through a wall than look at a spreadsheet.
Even if it’s not the most favorite part of your business…
It’s something we all NEED to do in order to grow and scale.
Because …
#1 – You can’t improve what you don’t measure.
#2 – You have no idea what actually needs to be fixed if there’s a problem. (Example: You may think you need more leads, but you may really just need to tighten up client retention.)
—> Since we’ve been talking all about HABITS this month, tracking your KPIs is an important habit to add to that list.
KPI stands for: Key Performance Indicator
KPIs are the pulse of your business … they measure your business’s growth and health.
Although there are hundreds of data points you could be tracking …
There are just a few key #’s – that as long as you track them – will help you make better decisions in your biz.
Here are a few of the essential KPIs I recommend tracking:
- # Leads (& where they came from)
- Set / Show / Close
- # New Clients Signed
- Clients Leaving
- Clients on Hold
- Total Members
And, staying on top of your:
- Revenue
- Expenses
- Payroll
- Profit (Profit = Revenue – Expenses)
- Profit Margin (Profit Margin = ((Profit / Revenue) x 100)
- LTV (lifetime value of a client)
There are many other KPIs to track … including client retention & attrition, the performance of team members, client referral rate, or even how different front-end offers convert to long-term clients. The list goes on.
Knowing your numbers gives you incredible power.
There’s no guessing about what is working or what isn’t … it’s all right there in black and white.
Don’t get overwhelmed if you don’t have a system in place yet.
Keep it simple and track it all right in Google Sheets.
The trick is just to START tracking and make it a habit.
In fact, set the alarm on your phone for the same time every week to remind you to update your numbers. 🙂
Even better if you can have someone on your team do it.
Once you’ve got your numbers together, review them during your weekly review!
THIS is how you begin to create change.
Make it a fantastic Monday and rest of your week!
Alicia
