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Using KPIs to your advantage by small business accountants

KPIs is a pivotal part of every business- big or small. They can often give you better business insight- measuring performance and helping you make decisions. For years, the benefits of using KPIs have been clear. Not only do they give your staff a goal to strive for- improving morale, they also close learning gaps, detect patterns in your sales, and helps with forecasting. Here at M.A.S Partners, the leading small business accountants in Zetland, we understand the importance of effective KPI usage, and how they can help a business grow. As such, we have provided some tips to help your business grow through the use of KPIs.

Choosing what you measure

Although you want to set multiple goals, make sure you only set goals that are relevant to you. This may seem obvious, but it is absolutely essential that you do so. Different sets of metrics are important for different businesses- so focusing on the right goals will give you early confirmation of success or alerts of potential problems. This stage may be difficult for some, so consider hiring a small business accountant to help you decide what KPIs are important for you- where they will consider your industry, the business size, the business life cycle, your financial goals, and unique personal circumstances.

Characteristics of a good KPI

When selecting your KPIs, they should have 4 characteristics. They must be relevant, where the best metrics are those that have the most impact; they must be balanced, where they measure both short and long-term KPIs; they must be understandable, where everyone in the business will know what your KPI means; and they must be shared with everyone within your business.

Areas in which you need to measure

KPIs need to concentrate on your key areas of the business, such as financial, marketing or customer services. There is no use in measuring your performance for the sake of measuring. Everything in your business should be done with a purpose, and KPIs are no exception. Depending on your business, you may want to have more or less KPIs. You should have a wide range of KPIs measuring different aspects of your business. Common types of KPIs that will help your business grow are ones that measure efficiency, growth, health, and resilience. This is important as this will cover a wide variety of financial goals and will help your business grow in return.

Consider M.A.S Partners for small business accounting

Setting up your KPIs can be a difficult task especially if you are in an unfamiliar industry or have little accounting experience. Our small business accountants at M.A.S Partners work with hundreds of different businesses all in a variety of industries and understand which KPIs are suited for what business. We can help you choose your KPIs as well as help you analyse them. For more information on our small business accounting services, click here.