Using Metrics & KPIs in your business can make the difference on how well you know your operation.

What are Metrics and what can you do with them?  Firstly, Metrics are non-financial measurements of something in your business. They may be related to finance, particularly in outcomes (more customers generally results in more revenue) but sometimes they can be fixed (the area of your shop, for example). It his in this context, the form part of their second purpose by being the foundation of industry/business specific KPIs.

Like many people, have you been wondering what to use them for? We often, especially those of us who’ve been trained in finance and accounting, direct our focus to the numbers with dollar signs in front of them. Let’s turn our attention today to Metrics.Metrics have been part of Calxa Premier for a while now.


What can you do with them?

If you’ve been working in your industry for many years, you probably have a good idea of the main numbers that are important to you – it could be the number of meals you serve, the number of items you produce or the occupancy rate of your hotel. The main thing to remember when choosing the Metrics for your business is that they should be something that makes a difference: If the number increases or decreases will your profit increase or decrease?

One of the benefits of recording your Metrics in Calxa is that you can start to budget for them. Instead of just forecasting your revenue, forecast the number of customers as well. Then use a KPI to calculate the average revenue per customer. If revenue falls below budget you can then clearly see if it was because of fewer customers than expected or because each customer spent less than expected. Each will then lead to different actions to rectify the problem and that’s where you get the benefit – Metrics should drive actions that change the business positively.


Give me some Examples!

Metrics tend to be industry-specific to some extent but be open to looking at what people in other types of business are using – something may trigger some interesting insights into your own organisation.


Average Revenue per Cover: Record the number of covers (that’s individual diners for those not in the hospitality trade) as a Metric and then create a KPI to divide revenue by covers. For a better breakdown, separate food and beverage revenue to get an average for each. It’s a good guide to how well your staff are upselling your customers.


Sales per square metre: Put in the area of your shop to provide a consistent way to benchmark yourself against other retailers or others in your franchise group. If you have a large shop with clearly separated departments consider doing this calculation by department to see which are making best use of your space.


Revenue per employee: Create a Metric for the total number of employees and see how much revenue each is generating. You could segment your employee base to look at just one group – using this method, PWC show revenue of $3.5m per partner.

Profit per employee: Or look to see whether you’re closer to Apple ($407,000) or Walmart ($6,300).


Online Business

Sales per visitor or Leads per visitor:  Which of these is important to you will depend on the type of eCommerce site you are running. If you’re selling low-value, high-volume items, you’re probably looking for quick sales directly from the site. Comparing the number of sales with the number of visitors makes perfect sense in this case. If your sales cycle is longer, your website is probably designed to generate leads first and then you nurture them to convert to sales – a separate KPI.


Whatever business you’re in, there will be some numbers that are really important and make a difference to the way you operate. Using Metrics in Calxa now gives you the ability to easily report on them and to combine them with your financial data to tell you everything you need to know.


For the technical information on how to start using Metrics in Calxa, visit our Help Centre.