key metrics

4 Key Sales Numbers to Track

November 6, 2018 TonyB Coachcasts, Marketing, Sales 0 Comments

3 Key Metrics Every Business Should Track

March 1, 2018 TonyB Coachcasts, General Business 0 Comments

E449: Managing Our Variable Costs

May 5, 2016 TonyB Coachcasts, General Business 0 Comments

Stay on top of your variable costs to manage cash flow.

 

  1. Variable costs – Project and Overhead
    1. Fixed costs = rent / insurance / etc. – they are the same every month and cannot be avoided
    2. Variable costs = labor / misc. spending / etc. – things that change each month and are not always needed
    3. Our costs vary every month – we need to manage those costs to avoid cash flow crunches
  2. Use your key metrics to plan ahead
    1. Billings – Job Costs = Gross Margin which needs to be higher than Overhead Costs
    2. Plan and track each month to know when you need to adjust
      1. If you miss your targets in May – make adjustments before you run out of money
      2. If you pass your targets in June – use the extra cash wisely when it comes in
    3. Use your Average A/R Aging to know when the cash flow will be short or you have additional funds
      1. If you are short in May and your A/R aging is 50 days then your cash intake will be short in July – prepare for it
  3. You know the future so plan for it and make adjustments now
    1. Look for ways to adjust your variable cost
    2. Adjust labor and overtime
    3. Avoid non-essential purchases
    4. Use the power of broke to get creative
      1. Instead of driving to job sites do video chats – saves gas money

E448: Planning And Tracking Monthly Project Revenue

May 4, 2016 TonyB Coachcasts, Project Management 0 Comments

Our project teams play a major role in meeting our key metrics.

 

  1. Setting your monthly targets
    1. Monthly billings – project each month in advance
    2. Monthly project costs – manage your labor, suppliers and subcontractors
    3. Align these targets with the business key metrics
  2. Create a plan to reach your targets
    1. Use the Schedule of Values to predict your monthly invoice
    2. Review you labor plan to maintain cost
    3. Plan your material deliveries to meet goals yet control cost
    4. Coordinate your plans with your subcontractors
  3. Coordinate and track your efforts – If you expect it, inspect it!
    1. Coordinate your plans
      1. Make use of a 3-week look-ahead schedule
    2. Calculate the required productivity so you can track regularly
      1. Break down production to weekly or daily goals
    3. Track all activity against your plan and make adjustments
      1. Set out to meet your projected revenue by the end of week 3

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