Know Your Numbers (Even If They’re Small Right Now)
By: A Staff Writer
Updated on: Sep 02, 2024
Know Your Numbers (Even If They’re Small Right Now)
“I’m not making enough for that to matter” is how businesses flatline. Understanding a few key metrics unlocks growth potential.
We stick our head in the sand about money, then panic when it’s suddenly a crisis. Proactive is always better.
- Profit Margin: How much you KEEP after expenses is more telling than top-line revenue. Tells you where to focus.
- Customer acquisition cost: What does it cost you to get ONE new client? This informs your marketing budget.
- Burn rate: How long could you operate with zero income? Having this buffer gives you peace of mind to take smart risks.
- Lifetime value of a customer: Are you focused on one-off sales, or the long-term relationship? Changes your strategy.
- Cash flow is king: Profitable on paper is useless if bills are due NOW and you’re waiting on late-paying clients.
- You don’t need complex software: A simple spreadsheet is fine to start. The habit of tracking is the real skill.
Which ONE metric would make the biggest difference if you started paying attention to it?
Choose a day of the week to be your “money date”. 15 mins to update your numbers, that’s it!