Measuring the success of your business is an important way to keep your business running smoothly. This is how to measure business performance and our top tips help you keep track of your company’s performance and your profit/loss margins.
Monitor your business's financial statements.
Your financial statements show how much money you earn and how much is paid out. You can accurately set the price for your products and services. You can see how much money you’re gaining and losing for the business overall and on certain projects. You need financial statements in order to work with bankers and investors, and send accurate reports to tax agencies. The following three statements help you keep track of your business finances.
The income statement shows your earnings.
The balance sheet gives an overview of your business assets and shows who owns them.
The cash flow statement shows your deposits and expenditures over a given time period.
Measure customer satisfaction based on two factors.
How satisfied are your customers with the quality of your products and services?
What is the level of your customer loyalty? For example, ask if your customers would recommend your business to a friend or family member. Behavioral intent is a means of determining when or how often a customer returns to your company. This is a great way to learn how to measure business process performance. Ask customers about their overall satisfaction with their experience at your business establishment and how important certain attributes are to the decision to purchase products and services from you. You can do this in several ways.
Conduct customer satisfaction surveys.
Ask customers to leave reviews on your products or services and if they have everything they need.
When customers make requests or suggestions on how you can improve a product or service, take their suggestions and requests into consideration.
Keep an average of how many new customers or clients you get through word of mouth.
You can do this by collecting customer email addresses either through a subscription to your company newsletter or through online orders. Knowing how many new customers you get in a given month, quarter or year is essential for tracking the growth of your business.
Conduct performance reviews to measure employee satisfaction and business productivity.
Conducting performance reviews will help you understand the needs of your employees. If an employee is unsatisfied for any reason, you can work out a plan to solve the problem.
Take a look at your own expectations for your business.
After evaluating the above criteria and keeping current with market trends, evaluate your satisfaction with where your business stands at the moment. Check to see if your numbers are where you want them to be.
Your satisfaction with the success of your business is an important factor in your company's overall success. If you want to grow your business even further, take some time to strategize the next steps toward scaling your business.