Danny Pritchard
September 4, 2024
Why do we advise you to measure these? These are the most crucial indicators for business success that every business owner should be looking at. Our aim here at Bring On Monday is to see New Zealand business owners achieve their business and personal goals. So even if we aren’t your current nz business coach, we hope that knowing what to measure, and how to measure these 7 key numbers will help you. So what are they?
The 7 key numbers to measure in your business are: Revenue Growth, Gross Profit %, EBITDA, Revenue Per Employee, Cash Days, Core Cash Target, and last but not least, Business Return.
Let’s take a look!
Revenue growth is about comparing this year’s revenue to last year’s. Every business aims to grow in some way, and tracking revenue helps ensure you’re on the right path. While revenue isn’t everything, it’s a solid indicator of a growing business.
Measuring your business’s gross profit % means you are ensuring the business is generating a decent profit from its core activities. This takes into account the costs involved in making sales and delivering services or goods.
If you use us as your nz business advisor, you’ll have heard us use this term before. ‘EBITDA’ stands for Earnings Before Interest, Taxes, Depreciation and Amortisation. This is a measure of a company’s overall financial performance and profitability from its core operations. It helps business owners understand how well their business is doing operationally.
It’s all in the name! Revenue per employee evaluates revenue, employee costs, productivity, system usage, training adequacy, and tool efficiency. This single number offers great insight into the business’s operations and culture (think of it as a vibe check).
Measuring cash days provides a snapshot of your business’s cash flow cycle and indicates how efficiently money moves through the business. If you need help with this, we can help you with our small business accounting services.
Core cash target is the ideal amount of cash businesses should keep on hand before launching new projects or paying additional dividends. It considers total taxes due and includes a buffer for overheads.
Measuring your business return assesses the value your business generates based on its current profit. It’s a measure of whether your business efforts are profitable or if your investment might be better off elsewhere.
If you want to learn how to calculate the 7 key numbers for business growth, follow us on Instagram here and see how we break down the calculations into easy step by step videos! Plus you’ll never miss a business tip again!
Remember if you own a New Zealand business and want to free up your time doing the things that you love, reach out to us and take advantage of our small business accounting services. Be it accounting, bookkeeping, business advisory, or if you want a nz business coach, we do it all and would love to chat!
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If you find a cheaper all inclusive accounting solution similar to the 'BOM Difference', we will beat it by 10%. In addition, if we haven't made your life as a business owner easier after 3 months, we will donate all subscriptions fees to your favorite NZ charity.
