Business strategy meeting - LINC

Six numbers to track growth

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Every business has their own critical success factors to indicate how well they are doing. These success factors could be sales growth, number of new leads, customers retained, recurring monthly revenue, or agricultural yields. However, there are a variety of ratios which are easy to monitor that are commonly used by businesses to keep tabs on growth. Review these six ways to track your business's growth:

Number 1: Gross Margin

Gross margin is the difference between what you pay for a product and what you sell it for. If you don’t have physical products, skip this suggestion!

Look to improve your gross margin by:

  • increasing your prices
  • reducing cost of goods sold (COGS) by using lower cost of materials or different components where possible and without affecting quality
  • asking your current supplier to reassess their pricing
  • reducing waste and buying only what you need 
  • recycle and reuse any waste materials you can, and make sure your employees are doing so as well

Number 2: Average revenue per customer

Increase the number of goods customers can buy from you. It can be products, hours, services, warranties, insurance; anything where a customer is encouraged to buy two things rather than one.

Build average revenue by:

  • using sales data to identify what your best customers are buying and think about what other products or services could be sold. Tailor special offers to bring those customers in more often
  • up-selling and cross-selling
  • bundling products and services together
  • focusing on your ‘gold’ customers – those responsible for high, profitable sales. Target customers with the most potential and then develop a specific proactive plan for each of them

Number 3: Revenue growth

Steady, predictable revenue growth is the sign of a healthy company. Grow revenue by:

  • using in-bound CRM software to better predict who is likely to buy from you and set up lead generator tools or content to gather interested prospects
  • developing new products or services for your existing customers
  • creating a marketing plan to identify, locate and sell to new customers
  • looking for new distribution channels to expand your customer base, such as third-party selling (Amazon, e-bay, iTunes etc), and your website
  • franchising if demand for your product or service warrants it

Number 4: Revenue per employee

Revenue per employee can be affected by several factors, including average revenue per user, better systems and processes, and automation. Tracking this metric is often useful for those businesses that sell per hour.

To encourage higher revenue per employee, try:

  • making sure staff have the equipment and training they need to do the job right and keep them informed about business performance and management decisions
  • setting goals for your employees. Help them put a sales plan in place, and then measure how successful it is
  • making sure your sales data is transparent, so employees know who’s selling the most

Number 5: Net profit percentage

This is the margin that accrues from all the effort of a business and is the ultimate measure of how a company is being operated.

Increase your net profit percentage by:

  • lowering overhead by searching for better deals on costs such as energy, internet, and phones
  • reviewing your equipment needs. It could be that you’re better off leasing equipment only when it’s needed, rather than buying it outright
  • looking at outsourcing some of your staff needs, such as administrative tasks like payroll, to companies that will charge a monthly fee instead of a salary
  • making sure you swiftly collect money that’s owed to you – it should be coming in faster than you must pay it out

Number 6: Net Promotor Score

Tracking customer satisfaction via opinions, feedback and ratings can give an invaluable indication of dissatisfaction (for remedying) and of advocacy (for marketing amplification). Anything that improves the communication between customers and a business should lead to better decision-making.


  • analyzing the market to identify trends and try to predict customer needs. Find out what people are saying about your competitors and use that information to improve the customer experience in your own business
  • keeping track of any customer complaints. Document who the customer is, what they were unhappy about, what was done to resolve it and if they went away satisfied
  • making the most of social media to keep in touch with your customers and measure their levels of satisfaction
  • send out annual or bi-annual customer satisfaction surveys via email or newsletter


By tracking and improving these six variables, you should be able to improve your gross margin, raise the value of your average sale, drive revenue, build the productivity of employees, increase your net profit percentage and have happier customers.

Decide which of the six metrics you want to measure, then set up monthly reporting so you can see if they are improving each month. If not, then you can act before the number deteriorates further. Implement those actions that are relevant to your business to improve each metric.