Norton Accounting Services - July 2020

HOWWELL ARE YOU TRACKING YOUR BUSINESS? 3 Key Performance Indicators to Watch

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. As you’re tracking these KPIs, remember to be skeptical. If a metric looks too good to be true, it probably is! So dig in and double-check the math. If you uncover an inaccuracy, you can take steps to fix it, and if you find the number is accurate, you can learn from your successes. Armed with these metrics, you will be in a much better spot to be proactive in your business and solve minor problems before they ruin your month, quarter, or year. It’s a win-win situation, which is exactly what we need in these tough times!

systems and processes more easily. Then, you can take proactive steps to reduce your churn.

In the last few months, 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 This metric will tell you how many customers leave your business in any given month, which will then tell you how many 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

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 goal-setting 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 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

Take a Break!

Inspired by DinnerAtTheZoo.com

The Best Grilled Summer Vegetables

Ingredients

onion, red bell peppers, baby carrots, and yellow squash are great on the grill)

• • •

1 tsp salt

1/4 tsp pepper

1 1/2 tsp dried Italian seasoning 1 1/2 tsp garlic, minced

• • •

5 tbsp olive oil

2 tbsp lemon juice

• •

1/4 cup parsley leaves, chopped

2 lbs assorted vegetables, trimmed and halved (asparagus, mushrooms, red

Directions

1. In a small bowl, combine salt, pepper, Italian seasoning, and garlic. 2. Brush vegetables with olive oil and place in a large bowl. Top with lemon juice and seasoning mixture. Toss to coat evenly. Cover and refrigerate for at least 20 minutes but no longer than 2 hours. 3. Prepare the grill at medium-high heat. 4. Grill vegetables in batches, cooking 3–5 minutes on each side until browned and tender. (Carrots will cook longer, 6–9 minutes per side.) 5. Remove from the grill, sprinkle with parsley, and serve hot.

RUBY SPARKLER SUNGLASSES SWIMMING

LARKSPUR PEACHES PICNIC POPSICLES

CAESAR FIREWORKS GRILLING INDEPENDENCE

985-640-6072 • 3

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