Business Metrics Reporting
When it comes to business metrics reporting – as an entrepreneur, it is extremely important to keep track of how his/her business is going in terms of finance and growth.
In order to do so, there are some business metrics which act as an assisting tool for measuring the current market position of a business. Here are the top 5 business metrics for reporting, which are incredibly useful.
Take a look at these examples and make sure you use them as part of your business metrics reporting system. Regardless of what types of tools or business reporting templates you use – make sure you include these key business metrics.
For an owner of a business, the first goal is to survive in the market. This can only be done through sales. If a product is popular in the market, the business will end up selling their production stock completely.
This will enable the company to gain sales revenue. The higher the sales revenue, the higher the chances of survival and expansion. Sales revenue will also fuel the business as whole by paying for its operating and selling costs.
Net Profit Margin
As discussed earlier, sales revenue is the first and foremost component of a successful business. However, without a high net profit margin, it is not possible to run a business in the long run.
An entrepreneur’s goal after survival is growth and without extra cash, he/she will not be able to invest money on that. The greater the net profit margin, the greater the scope of an entrepreneur to expand his or her business.
Indeed, net profit margin is undoubtedly important for a business although gross margin is a major decision changer too.
If a gross margin is low, it means the business is not performing well enough to reduce its cost and reach for economies of scale. The higher the gross margin, the better the utilization of its resources.
The business costs must be controlled for it to operate efficiently. Hence, gross margin is a very good internal business metric which is very sensitive towards cost of goods sold.
Monthly Recurring Revenue (MRR)
Net profit margin and gross profit margin is only applicable when there is a financial year end. However, in order to run the business on a daily basis, a monthly recurring revenue (MRR) is very much required.
There are certain costs a business has to bear on a regular manner and these revenues help to pay for them. The higher the MRR, the safer it is for a business in the long and short run both.
Net Promoter Score
Money is an obvious indicator of success for a business. However, if a business is planning to gain a great amount of market share, it has to make sure that its’ products are creating an impact on the customer base.
Net promoter score is a metric which focuses on the popularity and the brand image of a business. The higher the net promoter score, the more chances of an enterprise to get a greater grip of the market.
Business metrics reporting can be done in multiple ways. It completely depends on the owner of the business although the key factors of running a successful corporation are the business metrics mentioned above.