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Sales seem to be going well. Is it time to hire some help? Increase marketing spending? Should you cut some costs? So how does a business owner make these decisions? By reviewing Key Performance Indicators (KPI) to evaluate progress towards goals and overall organizational health.
KPI’s are values that act as measurement towards objectives. These indicators provide quantifiable evidence of the progress of business activities. Quantifiable means the informations gives you statistical/numerical data which is ideal for comparison and evaluation. There are different KPI’s to evaluate different types of goals. See the image below to see the most common performace indicators applicable for most small businesses in the category of either sales, marketing, and finance
So if one of your goals is to increase annual sales then you might want to evaluate how many leads are converting to sales and where those leads came from. Knowing this information would help the business to know where to focus their marketing efforts and where they are lacking or succeeding in converting clients. As they say “Knowledge is Power!”, the more you know about your business performance the more adjustments, improvements, and reinforcements you can put towards improving your business.