Design agency case study
Design industry client How we helped our clients improve profitability
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Understand your business trends
How does your performance compare to previous years?
It is almost impossible to evaluate how well you are doing in business by looking at one set of figures from one financial year. Performance is always relative.
How good, for example, is a profit of £100,000? It may be really good for a business with a target of £20,000, but it would be bad for a business with a profit of £500,000 in the previous year. How would you feel if this was your business and every other business in your industry achieved a profit of £5 million?
You can therefore only really judge performance by comparing it to:
- Targets
- Previous months and years
- Others in your industry
Your one page plan (see Measure your performance) should compare your monthly performance with your targets.
The benchmarking analysis (see Benchmark your competitors) will show you how you compare against others in your industry.
The aim of this step therefore, is to identify and analyse the underlying trends in your business over the last five years. The key trends that successful businesses focus on include:
- Profit and loss accounts trends such as sales, margins, profit drivers, breakeven
- Balance sheet trends such as liquidity, debtor days and stock turnover
- Trends in key ratios such as gearing and return on investment
We can help you by carrying out a financial performance review for you and explain it to you in plain English helping you to really understand the reasons behind your business performance.
If you would like to have a chat about this, give us a call
How Beyond the Numbers will help you…
We believe that you should want more from your accountant and we are happy to help you with our 9 step plan towards performance measurement and improvement.
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The Numbers
VIEW NUMBERWe believe that you should want more from your accountant and we are happy to help you with our 9 step plan towards performance measurement and improvement....
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1. Set your goals
VIEW NUMBERWe believe that you have to look at both your business and your personal life if you are going to set goals for the business as the two are intrinsically linked – through you!...
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2. Develop your plan
VIEW NUMBERHaving identified your goals you need to convert these into a business plan so that you know what your business needs to do to help you achieve these goals....
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3. Measure your performance
VIEW NUMBEROnce you have created your forecasts and budgets (see Develop your plan) you need to systematically measure your actual performance and compare it to your targets....
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4. Your annual accounts
VIEW NUMBEREvery business is required by law to produce annual accounts and of course those annual accounts must comply with all the relevant rules and regulations....
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5. Understand your business trends
VIEW NUMBERIt is almost impossible to evaluate how well you are doing in business by looking at one set of figures from one financial year. Performance is always relative....
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6. Benchmark your competitions
VIEW NUMBERBenchmarking is one of the most commonly used management tools in the world and it’s not hard to see why....
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7. Value your business
VIEW NUMBERIs one of the reasons you own a business to create value for yourself? In other words, do you want to build a business that is actually worth something when you want to sell it or ...
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8. Improvement potential
VIEW NUMBERMost businesses always have room for improvement and it can be dangerous for a business owner to sit back and assume that everything is going really well and will continue to do so...
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9. Improvement action plan
VIEW NUMBERNothing changes until something changes so you need to develop and implement an action plan....
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about our experience helping other clients in your sector.
We’d love to help you, too.