What are the KPI’s you are currently using in your business? Do you know what a KPI is?
“KPI” stands for key performance indicator, a KPI is basically a way to measure your business performance using your accounting and non-accounting data (website and CRM statistics for example).
In your business you should have decided on the main ones you need (gross profit margin, net profit margin, debtor days, inventory turnover and liquidity ratio are a few you may have heard thrown around).
KPI’s can sound intimidating, but they need not be. It’s a good idea to come up with a few KPIs to review on at least a monthly basis. These metrics will give you another tool to help keep your business on the right track.
If you know of someone who would like to understand their business further, please get them to contact us so we can help de-mystify the numbers behind their trading.