Easy But Powerful Key Performance Indicators To Track (Part One)

Easy But Powerful Key Performance Indicators To Track (Part One)

Be Sociable, Share! TweetI’ve been reading a number of articles on key performance indicators recently and wow – talk about complex measurements!  There are numerous easy to measure key performance indicators that can be measured on a weekly or monthly basis that will tell you a lot about your organization. Why track Key Performance Indicators at all?  As you make changes in your business, or as the world changes around you, you have the opportunity to measure the effect of various influences on parts of your business and do something about it.  If you aren’t going to act on changes in KPIs – don’t bother tracking them. So what KPIs do I recommend tracking?  I have about thirty I’d like to talk about so we’ll break this into a few different articles. Gross Profit Margin (%) – The difference between the dollar volume you sell vs. the cost to produce it.  This does NOT include your overhead expenses (payroll, commissions, rent, taxes, etc.).  You should compare this metric against others in your industry, and if you see it decreasing you either have an issue with how much you are selling, or the cost to produce your products. EBITDA (%) – This is “Earnings Before Interest, Taxes, Depreciation and Amortization”.  In plainer English – it’s your net profit before you do all of the adjustments for taxes and depreciation, etc.  Once again, compare this percentage against others in the industry.  If you start seeing decreases in this but your Gross Profit Margin is staying the same then you may need to look at your sales compensation plans, marketing expenses or...
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