Time to take action on your management information?
The importance of looking at your numbers and taking action on a monthly basis.
Do you look at your numbers every month and action anything as a result of seeing them? Or are they a necessary evil, only good for reporting to the tax authorities?
Our latest blog shows you how to interpret and use monthly management information to build an even more successful business…
Cash is King! But cash isn’t the same as profit…
- The profit and loss account shows you whether you’re actually making money or not
It is not dependent on who has paid you (or not) and who you have paid (or not). This is a clear cut, indisputable, snapshot of profit.
- You can’t wait for the annual accounts
Monthly information means you can spot trends in your business quickly, and so you can take action quickly to maximise an opportunity or correct cost decisions; wait too long and you’ve missed it.
- Improve your sales:
Look at your sales by the different types of sales you provide – these could also analysed by job or client or product category or region so you can see how much of each sales type you sell every month and which sales lines are growing or shrinking.
- Know that you have the right cost base:
Check your costs and make sure you’re not spending money where you don’t need to be – costs tend to creep up – this is the report that will show you what your costs are every month regardless of when you get, or pay, the bill.
- Know which sale streams make you most money:
Analyse the profit you make on the different sales lines – you could be surprised at the difference between them – focus on generating work that is the most profitable and has the biggest opportunity for you.
- Know which clients are most profitable – and which ones cost you more than you bill:
Analyse the profit different clients generate for you – include all the costs of servicing them, and consider which ones you enjoy working with because it’s interesting work, who pays you on time. Then have a long, hard think about what you change so you have more clients that make you money and fewer (or no) clients where you make a loss.
- Know what a really good client is for you and use this as a template for finding new ones
The result? More profitable clients, less unprofitable clients, a lower cost base, a more motivated workforce and more focus in your sales function and marketing spent.
If you want to talk about what information you want or should be looking at, and how you can easily get it, email firstname.lastname@example.org or call 01252 820002 and speak to our regional team. We’re always happy to help and offer a free two-hour initial review to help you understand how to make valuable changes to support your business.