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Business Monitoring Idea – 5

November 19th, 2010 · No Comments

Another key aspect of the business that needs close monitoring is cashflow. Revenues may be increasing, but if cash is not coming in on time, one can face a problem in paying vendors and employee salaries. For this, it is important to have rolling weekly estimates that look a month ahead on both expected payments [...]

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Business Monitoring Idea – 4

November 18th, 2010 · No Comments

What I have done is create a set of spreadsheets wherein I track numbers every week and every month. In addition, it has data for many of the key items for 12 months, allowing historical comparison, especially for margins. As a business grows, the hope has to be that the margins improve. For that, it [...]

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Business Monitoring Idea – 3

November 17th, 2010 · No Comments

For every business, it is important to define key parameters on revenues and costs and these need to be monitored monthly. Besides looking at profitability for the month, it is also important to look at trends – especially in terms of percentages over the past few months. For example, look at both the gross margin [...]

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Business Monitoring Idea – 2

November 16th, 2010 · 1 Comment

Any business where the gross margin is 50% or less needs to be monitored daily. Let me explain. Gross margin is the revenue minus the cost of goods sold. If it costs Rs 3 to buy a widget, and the selling price is Rs 5, then the gross margin is  Rs 2, or 40% (2/5). [...]

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Business Monitoring Idea – 1

November 15th, 2010 · 2 Comments

An idea I have implemented recently in NetCore for some of the business lines is the concept of Projected Score and Required Run Rate. It borrows from the cricket ODI and T-20 matches. An example will help explain. Let’s say in the first 10 days of the month, we have generated Rs 15L in revenue. [...]

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