A guest post from Fiona McKenzie at Blue Note Solutions Ltd:
When you began your business I’m sure that each sale was a triumph, imprinted on your memory as being one step more towards business success. As business activity expanded you might find that various details about your sales become less clear. However certain information can help you direct your business more effectively.
At least monthly you should look at your Sales Revenue:
- Sales breakdown by product or service
Knowing what your customers are buying, what is popular and how demand is changing over time enables you to adjust stocks or types of services offered. Perhaps you have not sold a previously popular service. Why? Is it now too expensive? Have you stopped marketing actively?
- Sales by customer
Knowing who your best customers are and what they are buying helps you to give customers extra attention and perhaps a little nudge to re-order. Sometimes existing customers can be overlooked in the drive to expand business and find new customers. Be aware also of becoming too dependent upon one or two large customers. I have known several businesses fail when their main customer ceased trading.
- Sales by period
Knowing what time of year you sell which products or services helps you to plan ahead by ordering or preparing before you obtain the actual sales order. You can also identify ‘quieter’ seasons and perhaps offer alternatives. If you don’t sell many umbrellas in summer perhaps stock sunhats from May to August.
Your most useful information will of course vary according to your business. For example a retail shop is unlikely to know the customer breakdown. A different business may find an analysis by geographic area helpful.
I’d be interested to know what other information about your sales has helped your business?
About the author: Fiona McKenzie is the founder of Blue Note Solutions Ltd based in Oxford. A Finance Director with many years of commercial experience, she now helps SMEs gain clarity and control of their financial performance. She offers a complimentary Profit Improvement Review to SMEs based around Oxford and the Thames Valley.