You may be keeping proper financial records of your business but still not quite getting the results you want. What could be the problem? That financial data does not tell the whole story of how business is doing.
You have to start incorporating collection of data, from everything that interacts with your business, as part of your day-to-day business operations.
Even though you may not have the hardware or software or analytics expertise to go the full mile, you can still benefit from having information that is simple to collect and analyze. The advantage of data to your business is that it helps you make far better decision, leading to better performance.
Here are a few things to have at your fingertips:
How seriously do you take feedback in your business? Especially one that comes informally, such as off-the-cuff comments. Are you one of those enterprises with a dusty suggestion box? You must find a place to put all the opinions customers, suppliers and other parties make about your product, service or operation. Compiling key terms will be enough. Are the comments positive? What do people keep emphasizing on? This will help you improve your customer experience, which is the biggest advantage small businesses have.
Your income statement starts with the sales revenue. It may be reading big numbers in 2017 – congrats!! It may have been increasing over the last few years, yet your profits are not going up by as much or they are even dwindling. This is one of the reasons to have refined information. What products are you selling most? By how much? When does it sell? What is the cost of selling that product? You have to test your sales numbers against different variables. A sale is not a sale.
Related to sales is finding out the profile of your customers and the income they generate. It should not just be a business plan thing. You may want to grow your market but retaining customers is a basic you should get right first. How many of your customers are not coming back? Why? (check your feedback) Who pays the quickest? How many of the people visiting your supermarket actually buy? You want to prioritize your best customer. But first you must know these ride or die customers.
Should marketing get its own post? Everyone puts their name out there and says they are marketing. You probably also do it in business. It’s not bad at all. What is bad is not knowing what you want to get out of it – and how much you’re willing to pay to get that. Is a marketing campaign successful because of sales conversions? Is it by the amount of traction it get? Is it by how long it lasts after the defined campaign period? These are questions to answer once you start getting the story behind your marketing.
Every Kenyan entrepreneur who thinks about her suppliers is only thinking time and cost. That is all supply chain is about – getting your goods moving as efficiently as possible. But how many monitor, with actual numbers in a spreadsheet somewhere, the time it takes to deliver goods and the prices supply, logistics charge for their services? This will be a powerful ace next time you go to negotiate. Data is way better for women entrepreneurs when it comes to improving their negotiation skills.