You’ve made it – after stressful days and sleepless nights, your business is finally a reality. Now you ask yourself “Will my business succeed?” Only time will tell, but there are some

Profit

Profitability is probably the first thing you measure success by. Is your business making money? If your bottom line is constantly in the red, your chances of success begin to decline. Your first step toward measuring profitability is to put together a cashflow.

Why it matters: Understanding the difference between cashflow and profitability means you will have a much better sense of timing:  so that the money you are making not only covers your expenses, but flows into your business in time for you meet your creditors’ payment terms.

A growing customer base

A growing customer base is an indication that you are successfully reaching your target market and this is what your business is all about. Don’t forget about your existing customers, they are your brand ambassadors. 

Why it matters:  Since they have already chosen you instead of your competitors, it’s wise to ensure that they remain satisfied:  there are many low-cost ways to do this, including SMS or email service reminders, after-sales follow up, web or phone based customer support and so on.

Customer satisfaction

Understanding your customers’ needs and being able to satisfy them is crucial to the strength of your business. One way of knowing how satisfied your customers are is simply by asking them via a survey. 

Why it matters:  Many types of customer communication, including surveys, can now be conducted using cloud technology – provided your customers have consented to or ‘opted in’ to receive your emails.  Cloud-based email companies such as Mailchimp are cost-effective and highly measurable.

Employee & owner satisfaction

It all starts at the top: if you are unsatisfied it will rub off on your employees (if you have them).  It’s imperative to develop a good work environment that rewards you and your employees for hard work. 

Why it matters:  Satisfaction can be hard to measure and may change from time to time, however the golden rule for business owners is to focus on a product or service you feel passionate about:  when times are hard, it is this passion that will keep you (and your team) from giving up.

It is impossible to know with complete certainty whether a business will succeed or fail, however paying heed to these four measures will help you understand where you are today and find the path to where you want to be.

Ready to take the next step? Register now to join us at our next 'Ask an Accountant' workshop and find out what impacts most on the success of your business.