5 Clear Signs That Your Business Is Growing
A business may be on the verge of growth, or experiencing a moment of impasse. In either case, if you don't pay attention to the numbers, you don't know if your Australian business really growing. You may have increased revenues, but may not be growing. Expenses may have gone up, yet the business is experiencing the highest percentage of sales growth in years.
Keeping effective control of revenues and expenses and being aware of when and how much your business is growing is not easy. In this post we would like to detail some indicators that you need to look at to know if your business is growing.
Income statement
The income statement makes you focus not on what you earn and what you spend, but on profits. If your business is not generating profits, and has not been generating them for years, you have to ask yourself what you are doing wrong and if you really have a business that works.
It is likely that you can make a profit, but you need to cut costs. Your assets may not be performing the function we expected. Or you may have increased your debt so much that your income is not enough to eliminate it.
Increasing profits has to be your priority. One of the recommended economic decisions is not to allocate 100% of profits to debt repayment, but to allocate a portion to savings and to reach agreements to determine reasonable payment terms.
Conversion rate
It doesn't matter how much traffic your website has if your conversion rate is enormously low. You are making far less money than you could if you invested in conversion optimization techniques.
By increasing your conversions, you are honing your revenue streams to give you a higher return. You can increase your turnover by showing more interest and effort in improving conversions, rather than putting too much effort and work into reducing superfluous expenses whose influence on the business is negligible.
Sometimes, you lose more when you spend too much time reducing small expenses than when you invest your skills in increasing revenue.
Visibility
When you increase your visibility, both online and in your physical store(s), you are also increasing the number of people who know you and can potentially become your customers.
Measuring the visibility of your business on a full scale is difficult, although on the Internet we can measure web traffic. The fact that our traffic has increased is an indicator that we are going to reach more people and we can increase our turnover, although it will depend on our conversion rate.
Improving your brand
It is difficult to measure, but when your brand improves, your business is growing qualitatively. Some indicators that your brand is improving:
- People are recommending your products/services more and more. You are generating influence and word of mouth is having an effect.
- You are being called to participate in congresses or conferences in your sector.
- The media have set their eyes on you and contact you for interviews.
- More and more companies want to collaborate or partner with you. They send you proposals to further enhance and grow your business.
The improvement of your brand has an intangible impact on the increase in turnover. Actually, you cannot predict with absolute accuracy all the effects of people talking more and more about you, or the effect your brand creates on people.
Exponential sales growth
There is a significant difference between growing by 2, 5 or 10%, and experiencing continuous exponential growth over the last year. This is a qualitative leap of great importance, which may lead you, for example, to increase the number of employees or even open our offices of your business in other cities, or expand through franchising.
These are signs that your business is booming and has a high growth potential. To realize these qualitative changes, it is of great importance that we have a suitable online management software, in which we can effectively visualize the sales data and our income statement, and we can compare them with previous years.
A mistake is to believe that your business is growing, when it is not really a growth that is maintained over time. Growth can lead you to gain confidence and make you believe that you are better than you are, investing more and taking greater risks, without paying attention to the need to increase the business' savings in order to have more room for maneuver.
Make sure that your business is growing, and if it's not you can always check our article on how blogs might help you grow your business.