6 ways to improve your business performance without increasing sales

13th February 2013

6 ways to improve your business performance without increasing sales

You are in business to make a profit, so how do you know you are making a profit?
How do you 
measure the performance of your business? Using profit and loss is a good indicator of financial results, but there are further ways to assess the business.

Key Performance Indicators (KPIs) give greater insight into how your business is performing and help you make better and informed decisions. 

Accounting ratios
 make it easier to:

1. Understand and interpret financial statements
2. 
Identify actual or potential problems
3. 
Make informed plans for the future

By looking at profit and loss you can see whether or not your business is profitable. 
To understand the full implications and what action may be needed you may also need to know:

•  If your profit is growing in proportion to the size of your business 
•  If you are making as much profit on new sales as you were on existing ones
•  How your profitability compares with that of other businesses in your sector

Measuring key performance indicators at regular intervals helps you to make comparisons and identify trends. Preparing management accounts on a regular basis also helps you keep track of your key ratios.

Set specific goals and targets
It’s also helpful to use indicators that define and measure progress towards specific goals or targets.
Here are a few examples that will have financial consequences:

 Amount of unbilled sales per period
 Success rate of sales calls/visits 
 Time taken to fulfil orders
 Time taken to respond to customer enquiries
 Number of errors in production
 Number of returns from customers

For more details and ideas on measuring your business performance, please download our factsheet.


How we can help 
We can help you identify appropriate KPIs for use in your business, prepare regular management accounts and help interpret the measurements and plan future actions based on them.

Comments



AishaLawson
20th Jul 2013

I have also personally

I have also personally experienced that accounting ratios are very useful and show the exact condition and situation which can make us aware at right time.

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Maya4
5th Aug 2015

Great initiative for

Great initiative for improving the business performance even the tools would be very helpful for the future planning.

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