Vine client, Jody Johnson from ActionCOACH Team Sage, was featured in today’s Business Monday! The article is definitely worth the read…
November 22, 2010Category: Uncategorized — Tags: ActionCOACH Team Sage, Business Monday, Business Public Relations, Miami Herald, Miami PR Agencies, Public Relations Miami, Vine Communications — vineinc @ 10:20 am
The Miami Herald > Business > Business Monday
Understanding Your Numbers
By Jody Ann Johnson
Special to the Miami Herald
In South Florida, we have the highest percentage of small business owners in the country, but Miami also has one of the country’s lowest household income levels. The disparity here is quite troubling.
Most business owners I meet are very busy taking care of their clients, customers, and team, yet don’t truly understand the numbers that make their businesses run. By “numbers,” I am referring to the building blocks of your business: number of leads, number of clients that come from those leads, revenues, expenses, and ultimately, profits. There’s no denying these past few years have been tough, but that just means its more important than ever to take care of your business the way you’ve always taken care of your clients.
Many failed businesses, and those that restructured to survive, have blamed the recession for their collapse. However, how do you explain the businesses that have had their best years ever? What are they doing that helped them not only survive the recession, but actually thrive in it? In my view, these business owners took the time to really understand the critical numbers needed to grow a company, even in times of uncertainty.
Here are some ideas you can implement today to get you on the right track to understanding your business.
Let’s start with leads: everyone knows their importance and wants more of them, but do you know how many you need every month to keep your business going?
First step is to track the number of people that express interest in your company each month and ask them how they heard about you.
Next, see how many of those leads become clients to determine your conversion rate. Finally, figure out, on average, how many times they buy from you and how much they’re spending when they do. All of these factors will tell you what your monthly revenues are.
The next step is to understand your expenses. Do you really know how much money goes out the door each month or are you just signing the checks?
Take the time to examine your bills and try to cut 10% of your expenses; it’s amazing how much money you can save if you try.
The difference between your revenues and expenses will determine your profits, the lifeline of your business.
You’ll see that following these simple steps will yield your business amazing profits. What’s incredible is that simply focusing on these numbers will make them grow, so imagine the changes in your business if a plan was actually implemented to improve them? By increasing each of the areas in the formula by 10%, you’d increase your number of clients by 21%, revenues by 46%, and profits by a whopping 61%!
There’s no need to be overwhelmed, so start off by focusing on only one area per month. Within a year you’ll know a great deal more about your business and how to steer your company to make the profits you so richly deserve.
Jody Johnson is the co-owner of ActionCOACH Team Sage.
The Miami Herald
Read more: http://www.miamiherald.com/2010/11/22/1936722/understanding-your-numbers.html#ixzz161aAZMKb
Jody Ann Johnson, ActionCOACH Team Sage
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