Are you in the first five years of growing your business and do you struggle with knowing what to track? What to monitor? What numbers to focus on your business in the first five years of running that business?
I’m in the fourth year of running The Money Panel business. When I started to measure these 10 numbers that I’m going to share with you it had a huge impact on me for two main reasons.
The first was that it enabled me to focus on what I call the return on investment numbers. Where was I spending my time not as effectively as I could have been? What techniques and tasks were the income generating figures in the business? How could I produce more of what was generating me income and impact?
I use those two words commonly together, income and impact because I talk about this a lot in my community that actually it’s not the money that drives me in my business, it’s the impact. But in order to have maximum impact, I have to generate wealth and profit in the business because if you’re not making profit in your business, then it’s not really a business. It’s a hobby.
10 numbers to focus on in your business in the first five years.
- Conversion figures
- Where your leads are coming from
- Organic social media growth
- Website traffic
- Email metrics
- Daily sales
- Daily expenses
- Recurring income
- Return on investment analysis
- Your energy.
Create more cashflow
At the end of this I’m also going to be sharing with you a free checklist that you can download that will enable you to continue this journey. If you’re in the first five years of business and want to know how to break that feast to famine cycle so you can create more cashflow in your business. It’s one of our most popular downloads
There’s actually more than 10 numbers, but I’m just going to share 10 key numbers with you because sometimes I think it can get really overwhelming. I would suggest that these are the 10 things that would be useful for you to track in your business if you’re in the first five years of business. Beyond five years I would suggest there’s probably some other important numbers for you to be adding into this mix.
Let me just say I was never a numbers girl. I got a C in maths at school. I was never particularly good with numbers. I’m still not great with numbers if I’m honest . I’m not a technical person. I’ve been through pension transfer qualifications and I’m still wouldn’t class myself as a technical person. I think that sometimes we have this fear that if we’re not good with numbers, that we can’t track it in our businesses. I think that that’s completely incorrect. You don’t have to be a numbers girl. You don’t have to be a numbers person to be able to track numbers in your business. But I think sometimes we have this fear of judgement don’t we. This little inner critic comes out and tells you I’m not very good with numbers so I don’t know what I’m doing. We feel like we should have just figured this out.
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1. Your conversion figures
When I say your conversion figures, you generally want to know what’s working and what’s not working in your business. Conversion figures could look like, for example, looking at where your sales came from last week and looking at where your leads were generated and looking at which ones are converted.
So maybe you’ve launched a free download and you want to go in and have a look at which ones of those are converting into sales. What’s your nurture sequence. When someone downloads something, what are you then emailing them? How are you communicating with them to build value and engagement? And which ones of those are converting, which ones are not.
Last year I probably put out about a dozen downloads and recently we did a review of which ones of those were converting to which ones weren’t. That was great for the business because we could identify, these ones obviously work really, really well. People really like these ones, but these ones not so much. It is a bit of a trial and error sometimes.
So what are your conversion figures? Having a look at what leads are coming in and what are converting as sales. If you’re running a small business, you can just do this with pen and paper. If you’re running a slightly bigger business, then using some customer relationship management systems or CRM systems can really help you with this management information data.
That’s the first figure that’s really important to be thinking about as your conversion figures. Then you want to do more of what’s converting. If something’s converting really well, do more of that.
2. Where your leads are actually coming from
Again, I do this with pen and paper every week. I use my CRM data and my email data but I also do a manual review of this. I think that’s important for me because it means I can get it in my head because I’m not a numbers person. I don’t like looking at spreadsheets particularly.
So are leads coming from Facebook? Are they coming from Instagram? Are they coming from LinkedIn? Are they coming from Twitter? Are they coming from recommendations?
Sometimes you might not even know where they’ve come from and that’s the scary place to be in, in business. You want to know where they’re coming from. Think about when a lead comes into your business, how are you actually asking where they heard about you? Do you have a question, like an on-boarding question? Is it in a questionnaire perhaps. When you’re on a discovery call with somebody, do you ask them, where did you hear about us? Are you making a note of that? Are you just making a note of it on a piece of paper that goes in the client folder or are you logging that on your CRM system?
Finding out where your leads are coming from is really important.
3. Organic social media growth
Again, in my planner every week, I track all of my numbers. At the start of the week, I look at my Facebook pages, my group, my membership, my podcast downloads, my blogs, my website traffic, all of the different platforms, LinkedIn, Instagram, YouTube, I look at all of them. You want to see what your organic growth is.
Up until last year, most of my social media traffic came from Facebook. That was the main place that I would use to communicate my content. And still is because Facebook is where I spend the majority of my time. But you want to have a look at what that organic social media growth is.
4. Website Traffic
You also want to have a look at your website traffic. Where is that traffic coming from? What are the key words that people are searching for? Where are people going on your website? How long are they staying on your website? What pages are they checking out? Again website traffic is going to convert into your leads and then converting to sales.
5. Your emails
You want to have a look at how many people are signing up to your emails. How many emails are they opening? Which ones are opening more than others? Your click rates, your open rates. Just once a week go into your emails and your email system (we use Active Campaign). and have a look at your open rates, which ones are people opening, which ones are people not opening.
Maybe you could do a split test and resend that email to people who didn’t open it, but maybe change the title. Then the title can have a big difference in terms of click rates and open rates. This could be something you outsource to a Virtual Assistant.
6. Daily sales
The next three tips actually, a lot of people recommend you do this on a weekly or a monthly basis.
I am a huge believer in doing things daily, particularly if you don’t feel like you’re very good at knowing your numbers, because this will get you good at knowing your numbers. What I would encourage you to do is go into your bank account every single day and have a look at your sales.
7. Expenses, &
8. Recurring revenue.
You may be running courses or memberships or masterminds, or you may have recurring income. I want you to be tracking these numbers daily. Whether that’s in a notepad or wherever that is, but really bringing some consciousness to your sales, your expenses, and anything recurring.
The reason it’s really important things about your sales and your expenses is because you want to look at your net profit because whatever’s left after your sales minus your expenses is your profit.
For those of you that have heard about the standard profit model, the Profit First model actually reverses that model. It talks about sales minus profit equals expenses i.e. your income coming into your business minus what you pay yourself, because that’s the most important thing is your profit, equals what you have left to operate your business on. It really gets you focused on expenses, but from a simple perspective. Track your sales, track your expenses.
9. Return on investment analysis
What I mean by that is simply just looking at all your expenses on a weekly basis and review it. Is that worth that money? Is it giving me a return on investment? If it’s not, then get rid of it or review it, switch it, maybe you could reduce the cost. Switch or ditch approach.
How many of you have potentially got direct debits and things that you’ve just kind of forgotten about?
Numbers 6, 7, and 8: daily sales, tracking your daily expenses, looking at your recurring income, because that’s going to give you that financial stability in times where you’ve got ebbs and flows in cashflow.
10. Focus on your energy on a daily basis
Energy flows where attention goes.
Think about where is your energy being spent. If your energy has been spent on random admin tasks that aren’t getting you a return on investment, then guess where your energy is going to go. It’s going to go quite flat.
You’ve got to think about income generating activities on a daily basis. Sometimes that’s hard. Sometimes it’s hard to think, well, I know I should be focusing on generating more sales, but it’s really hard. So I’m just going to focus on all the easy stuff in my business. I get it. I’ve been there, done that and sometimes still fall into that trap. It’s too difficult. I’m just going to focus on the easy things but it’s sometimes the difficult things that actually will get you the bigger return on investment. Once you’ve done them, you’ll feel so much better.
So give yourself a reward, think about the reward cue habits cycle. If you want to start creating and developing new habits, you start giving yourself a reward in order to create that habit in the first place. You may have experienced this. If you start going to the gym, for example, you soon fall off the wagon because there’s no reward at the end. So think about what reward you could give yourself by tracking these numbers.
What are you tracking?
I’d love to hear what numbers are you tracking specifically in your business? I’ll just run through those 10 again.
- Number one is your conversion figures. Where are you converting the most sales, where is your focus needed?
- Number two is where your leads are coming from.
- Number three is your organic social media growth. Where are you getting most traction right now? Is it Instagram? Is it LinkedIn? Is it Facebook?
- Number four is website traffic. Where is your website traffic coming from.
- Number five is your email metrics. What are your click rates, what are your open rates? Maybe do some split testing, which ones are working really well?
- Number six is your daily sales.
- Number seven is daily expenses.
- Number eight is your recurring income. What’s going to give you that stability of income during periods where maybe you have ebbs and flows in cashflow.
- Number nine then is your return on investment analysis. I would do this weekly, reviewing my expenses that I’ve been tracking daily and thinking, do I need to keep this? Is it a good return on investment? Or do I need to think about changing it or cancelling it?
- Then number 10 is focusing on your energy. Where is your focus because where energy flows, attention goes.
Let me know in the comments if you have any challenges around tracking these numbers.
It doesn’t need to be complicated. You can get this information very easily and even go back and do this work on your business for the last few months. Maybe you could get a Virtual Assistant to go back through your numbers, contacting your clients and asking them, where did they hear about you? What emails are working particularly well? What expenses are draining your bank, your cashflow. Where are you getting the most amount of traction?
There’s a book called traction by Gino Wickman. It’s a great book and in that book, he talks about getting traction in your business, what numbers it’s important to track, very different from the ones I shared with you today.
There are lots of other numbers to be tracking as your business grows and develops but if you are in the early days of your business and you’re just setting up or you’re in the first few years, getting strong financial foundations with your numbers and your business is really super important.
Book in a complimentary call to discuss how financial coaching can help you move from financial overwhelm to confidence and control.
Gina Wickman – Traction