Knowing exactly how your business is performing NOW is arguably one of the biggest keys to improving your business performance in the future.
With the development of cloud accounting, all the information is at your fingertips on a timely basis. You just need to use it!
Case study: Retail shop owner wants to better understand shop sales and usage of employees.
Business owners start to know this kind of information in their head ie how much the shop would generally take on any given day. However, it’s not much use to anyone up there!
Action: With a few changes to the data entry process, this information can easily be gathered, tracked and then reported on using the xero accounting system.
I have recently set up xero to track “daily shop sales” for my client. By also using the timesheet function, we can then start to report the use of employees v the revenue brought into the business on any given day.
Benefits: These changes will enable us to see –
- Which days generally bring in more revenue than others
- Which days typically require more labour
- Which (if any) employees are more productive than others
- How many sales (quantity) were made on a particular day
- What the average sale was on any given day (and any period of time)
Value: The business owner is now better equipped to determine rostering requirements and potentially save money on days where additional labour is not required, or perhaps schedule time for themselves on those quieter days to conduct any training and work ON growing the business.
Ultimately, by tracking the $ value of sales, # of customers in the store and the average value of each sale we can also now track the effectiveness of any sales strategies that are implemented.
Worthwhile exercise don’t you think?!
Take Home: What could you be tracking in your business to help you “join the dots” and move your business forward?