make more money: how to increase profits

Make More Money: How to Increase Your Results & Profits

Key Strategic Indicators• The things you need to measure daily, weekly,

monthly, quarterly or annually.• The signals that tell you if you're going in the

right direction or wrong direction• The information you need

to make good, timely decisions

Why Bother?

• Help you spot trends to take advantage of • Help you prevent serious problems• Help you create efficiencies• Help you increase productivity• Helps entire team know the

results of their efforts

Financial Measures • Total income & total expense• Cost of goods/services sold • Gross margin (total sales revenue – cost of

goods sold ÷ total sales revenue)• Gross profit• Mark up percentage• Percentage of uncollectables• Assets to liabilities ratio• Receivables (and as % of annual revenue)• Average sales days of receivables• Selected expenses as % of revenue (what's

your Achilles heel?)

Marketing Measures• Marketing dollars as % of total sales • Website hits• New e-news signups per

week/month/year• Open and click-through rates on e-mail

marketing• Number of social media followers• % response rate on direct mail or email• Number of event registrations (and % of

total invitees)• Number of networking events attended

Business Development Measures• What causes sales? Number of phone

calls, appointments, proposals, etc. • Number of sales• Number of new clients• Average sale per client• Number of clients• Number of referrals• Lead or proposal conversion ratio• Days to close leads• Customer retention rate• % of complaints• Lifetime value of a customer

Operational Measures• Sales per square foot• Inventory• Shipping costs (and as % of revenue)• Payroll as % of sales • Number of billable hours• Billable hours as % of total billable

hours available• Benefits costs as % of revenue• Delivery costs • Shrinkage (in dollars & % of inventory)• Days to shipping

Learn Your Profit per X• It’s different for each business• Could be profit per square foot,

per employee, per sales call, or per product, etc.

• Which numbers most affect your profit increasing or decreasing?

• It takes time to discover the Profit per X for your business

Businesses don't succeed or fail without

clues

What to ask yourself?

• What results do I want in 90 days?• What results do I want in 1 year?• What results to I want in 5 years?• What activities cause sales?• What activities cause increased expenses?• Which numbers make profits increase or

decrease?

Which 4 key measures will you commit to track?

• Choose one item from each of the four groupsoFinancialoMarketingoBusiness DevelopmentoOperations

• Any activity that causes sales (weekly) • Total expenses as % of total revenue (monthly)• Marketing as % of total revenue (monthly)

My Four Favorites

• Any activity that causes sales (weekly) • Total expenses as % of total revenue

(monthly)• Total payroll as % of total revenue• Marketing as % of total revenue

(monthly)

Create a simple dashboard that's updated weekly

Keep Score

Commit to measure four things

for four months

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