Do You Know Your Numbers?
Updated: Oct 20
What gets measured gets managed. What gets managed gets improved.
In my first conversation with a CEO considering improving the profit and growth of their small business, I ask one one small question (that's actually a big question), "Do you know your numbers?". If the answer is anything short of "Yes! I'll show you now". There's a massive opportunity to grow your profit, revenue, and accountability.
One must for any small business is to have a scoreboard. Scoreboards tell you if you are winning or losing. It's a home for the metrics and numbers that are critical to the success of your business. If you're ever in Wisconsin on a Sunday in the fall ask a stranger "What was the score of the Packers Game"? You'll find out if they won or lost, the score, and plenty more statistics and analyses as to what drove the outcome.
When you meet with your key team members each week, do each of you know the score? If you won or lost the last week?
If you don't know how you are doing week to week you can't know if you are going to have a winning season or losing season (or quarter or year).
If you aren't keeping track of the score (numbers that drive the health of your business), how can you make meaningful changes? Without these critical numbers, the default behavior is to guess. That might as well be gambling. If you want to make your business an asset you need to measure what matters!
Have you defined the numbers that matter to your business? ie. Profit? New Leads? Revenue? Retention?
Are those numbers or KPIs (Key Performance Indicators) accurately measured?
Are they updated frequently?
Are they visible to those that can influence and control them?
When we got focused on knowing and reporting these numbers at the Martial Arts School I grew to $1m in revenue, everything changed. Read more about my experience here.
If you want to see "real" numbers for a small client service business with a recurring revenue business model here they are.
Read through this and you can see, what actions we needed to take (more enrollments!) Our quits were under target, meaning that any new students was a bigger bonus to our revenue! Our trial program sales were way over goal! With near scientific certainty we knew that we were going to enroll 50% of those trials. That means our February was already going to be a 12 enrollment month!
What would it feel like to know that your next month was going to be a good one?
What it would it feel like to have your team understand their part in driving new students to enroll?
If you're ready to get serious about your business growth and answer the question "Do you know your numbers".