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THIS ISSUE INSIDE
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The Spider in the Middle of Your Marketing Web
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3 Reasons to Be ‘Boring’
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Success Story
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The Shortcut to a Strong Client Relationship
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Spotlight Branding’s Industry-Leading Podcast
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Are You Tracking the Right Metrics?
HOW WELL ARE YOU TRACKING YOUR BUSINESS? 3 KEY PERFORMANCE INDICATORS TO WATCH
In the last fewmonths, the coronavirus pandemic has forced businesses across the country to tighten their belts. Odds are your company is among them, but even if you’re doing well, accurately tracking your business’s performance is more vital than ever. Of course, this is easier said than done. Even in good times, it’s difficult to know which key performance indicators (KPIs) to track daily, weekly, or monthly to get an accurate picture of how your business is doing. However, many successful entrepreneurs report that three KPIs rise to the top: churn, pipeline revenue, and average annual revenue per employee. CHURN If your law firm supports a recurring payment model (i.e., something subscription- based), then this metric will tell you howmany
pipeline revenue 20 days into the month when you should be at $67,000, then you’ll know that you’re falling behind and need to make adjustments. AVERAGE ANNUAL REVENUE PER EMPLOYEE (RPE) Most companies with over $1 million in revenue make a minimum of $100,000 in average annual RPE, and it’s not uncommon to see small businesses making $125,000, $150,000, or $200,000-plus per hire, depending on the industry. The higher your RPE, the more effective your business is at maximizing its greatest resource: the people who work there. This number can become skewed or decrease if you’re growing quickly and hiring or if you’ve recently laid off staff. If you haven’t made changes and your RPE is under $100,000, you’re either overstaffed or facing a struggle ahead.
customers leave your business in any given month, which will then tell you howmany new customers you need to bring in the following month to break even. If you track this KPI weekly and monthly, patterns will start to emerge, and you’ll be able to find holes in your systems and processes more easily. Then, you can take proactive steps to reduce your churn. PIPELINE REVENUE Your pipeline revenue is the total sales volume you’d have if you won each and every piece of business you quoted over a given period of time. When compared with your actual sales volume each month, it becomes an incredibly valuable number for setting goals and tracking. For example, if you need to produce $100,000 in new pipeline revenue to close your goal of $30,000 in sales each month but are only at $54,000 in
More Referrals. Better Clients. Higher ROI.
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