Determining which KPIs are the most important to your business relies on a number of factors. First, you’ll need to consider the industry you’re in and your position within the wider market. Then there are things like the size of your business, how long you’ve been operating and how many staff members you employ. All of this combined with your overall business goals will have an impact on how you measure performance.
Despite this, there are a handful of performance metrics that transcend industries and are vital for business owners on every level to calculate. Utilised in the right way, this data can be hugely beneficial in driving your business forward and improving your bottom line. Here’s a look at the baseline KPIs every business owner should be measuring.
Stock and operating margins
Profit margins are often held accountable for the success or failure of businesses in their early stages. They essentially cover the extent to which your revenue exceeds the cost of stock and operations.
Having a clear view of your stock and operating margins is vital if you are to ensure your business continues to be profitable month after month. This is also one of the first metrics that potential shareholders and benefactors will ask to see when calculating the value of your business.
Your staff form the very foundation of your business and their performance is crucial to its success. This is particularly true of small and medium sized enterprises, where it’s markedly important to get the very most from every employee.
Our EPOS systems track performance in real-time, giving you a clear overview of sales, transactions and revenue in relation to individual staff members. Not only can this be effective in deterring theft, but it offers valuable insight into which staff members are performing best and which could benefit from some additional training and nurture time.
Average spend per sale
Having an idea of how much each customer is spending at your store, on average, will give you a better view of your customer’s spending behaviour. From there, you’ll be able to qualify any upsell potential and gain a deeper understanding of how specific marketing campaigns are performing.
This metric is particularly useful if your business operates in more than one location. Comparing average customer spend across different stores and venues is a valuable benchmarking tool that can help you to establish which promotional techniques work best for your business.
As well as how much your average customer is spending, it’s crucial to get an understanding of whether or not they’re coming back. Enticing new clientele to your store or restaurant is one thing, but the real value lies in encouraging those customers to spend with you time and time again.
The Epos Now loyalty module can be hugely beneficial in encouraging repeat visits from your most valued customers, building a loyal customer base and improving brand awareness. From one convenient dashboard, you can set up branded loyalty cards and offer preferential pricing structures to frequent visitors.
As a general rule, the faster you turn over stock, the better. The end goal is to have a complete view of how much you’re selling, how much stock you need to buy in and how much money you have tied up in ‘dead’ or excess stock.
As well as streamlining the point of sale experience, Epos Now systems have the capability to manage stock levels with ease. As a business owner, you’ll receive complete access to inventory levels no matter where you are, reducing the need for manual stocktakes and ensuring you keep wastage and shrinkage levels to a minimum.
These performance metrics won’t always provide definitive answers. For instance, it’s important to consider how external factors such as seasonal variations could be affecting the data. However, where they do come in useful is in giving you a deeper view of your performance and highlighting areas for concern.
The best EPOS systems track these performance indicators automatically, so all that’s left for you to do is utilise the data in a way that directly benefits your business.