How often do you sit down to take stock of your business or company? It is important to measure the growth of a company if you want to determine if you are making any progress or not. There are several ways you can use to measure the health of your business. Although there is no single metric recommended, you can use methods that will give you the best results.
It is difficult to operate a business when you don’t understand the challenges that it faces. You need a way or ways to monitor and track your business in order to determine the direction that it is taking. This will help you identify existing gaps and potentials that your company has and take appropriate measures.
Here are 4 ways to measure your business revenue growth rate:
Set growth goals
Setting company objectives is one of the best ways of determining progress. Having goals to meet will not only provide you with something to strive for but also something to measure against. When coming up with growth objectives, try to be as realistic as possible. Don’t set too simple or very unrealistic goals.
It is important to set SMART goals. Goals that are simple, measurable, attainable, realistic, and time-bound. This means involving a professional or consultant who understands your industry well. Having an outsider as your consultant will keep you in check and ensure that goals are met as earlier stipulated.
Revenue is probably one of the most common determinants of the health of a business. A lot of aspects of your business are shown in sales revenue. Try to ask yourself various questions. Are your products targeting the right market? If that is the case, do they require any quality change? How about your marketing campaigns?
If your revenue is not falling within your expectations, then you have a few choices. You will need to change your strategy to ensure that there’s revenue growth. For example, provide customers with strategic discounts or sales, ramp up your sales offerings and increase your marketing campaigns.
Lead-to-client conversion rate
Generating leads is a great job but is not the end of the road. Turning those leads into active paying customers is the real job. Being able to track customer conversion rate helps determine the effectiveness of your various marketing strategies.
Start by dividing new leads by new customers to determine your conversion rate. In case the figures turn out to be contrary to your expectations, then it is time to make your next move. It doesn’t matter whether it is optimizing your landing page or providing additional training to your sales teams, you will need to take some action.
Customer acquisition cost
The cost of acquiring new customers is also a good method of measuring the growth rate of a company. The best way to do this is by dividing acquisition expenses by the number of new customers over a certain period of time.
Every business needs a system of determining its growth. Fortunately, there are several ways to determine business revenue growth. For more information, you can always check out places like SharpSpring.