Measuring Up! PART 1
𝐌𝐞𝐚𝐬𝐮𝐫𝐢𝐧𝐠 𝐔𝐩! *𝐏𝐀𝐑𝐓 𝐎𝐍𝐄*
Given #covid, you are finally afforded the time to work ON your business and not just IN it. So, let’s discuss your favorite topic 😉… Performance Metrics! Today we are starting a 3-part series on the Top Performance Metrics and KPIs vital to the success of your aesthetic business. Do you know the difference between these terms?
𝙋𝙚𝙧𝙛𝙤𝙧𝙢𝙖𝙣𝙘𝙚 𝙈𝙚𝙩𝙧𝙞𝙘𝙨 are ‘tactical’ data that track the status of your business operations to gauge performance while 𝙆𝙚𝙮 𝙋𝙚𝙧𝙛𝙤𝙧𝙢𝙖𝙣𝙘𝙚 𝙄𝙣𝙙𝙞𝙘𝙖𝙩𝙤𝙧𝙨 (𝙆𝙋𝙄𝙨) are ‘strategic’ metrics that measure how the business is performing towards its strategic goals. Metrics support KPIs, but KPIs are key to achieving your business priorities. You must therefore, choose the most pertinent KPIs for your goals.
The most elementary metric to track is your daily, weekly, or monthly Revenue. An important KPI to measure related to revenue would be your Growth Rate. You want to see consistent growth with your business over time and dialing-in on your monthly growth rate will help you measure your progress on hitting your annual growth goals.
Another revenue-related KPI would be to measure your ARC (average revenue per client visit). As your team focuses on retail, add-ons, and upgrades, you will want to measure how the average client visit ticket (in dollars) increases over time. This is a great KPI to track for your overall business as well as with individual team members. You can then tailor training for team members whose average tickets are below average or not meeting goals.
So, to recap your 𝐑𝐞𝐯𝐞𝐧𝐮𝐞 metrics:
-Measure total monthly revenue. Also break it out by 5-6 main categories (lasers, injectables, facials, retail, etc), so you can see where your growth is occurring.
-Calculate your M:M Growth %: (Mar Total Rev – Feb Total Rev)/Feb Total Rev = Growth % ; New businesses can grow at large growth rates month over month while more established ones often achieve more modest rates of growth.
-Figure out your ARC: total revenue $/total number of appointments = Ave $ per client visit
Start with these Revenue metrics & stay tuned for Part 2!