Business Strategies from Balanced Habits HQ
KPIs and Metrics… same thing?
Although they are both for tracking purposes, KPIs are extremely important for your staff to set-hit-exceed goals. KPIs should be defined for each department and role in your company, whereas Metrics tend to be more focused on the overall goals set for the company..
Key Performance Indicators (KPI)
KPIs should be well-defined, quantifiable measurements. They impact the bottom line: Whether your goal is to improve net profit margins or customer satisfaction and retention, an improvement in your KPIs should result in progress toward your goal. What are the most important key performance indicators?
- Revenue Growth (What areas offer the most promise?)
- Income Sources (Current and new profit centers)
- Revenue Concentration (Where you spend your dollars IE: Marketing?)
- Profitability Over Time (What has the most potential for growth?)
- Working Capital (Always know your numbers. Forecasting is key!)
Metrics
What are some basic examples of metrics?
- Sales Revenue (In most fitness clubs this is mainly dues)
- Net Profit Margin (Above the average for your industry)
- Gross Margin (20% profit margin is considered high or “good”)
- Sales Growth Year-to-date (The only way to predict future growth)
- Customer Acquisition Cost (How much does it cost to get a new one)
- Customer Loyalty and Retention (Huge tracking metric for this industry)
- Qualified Leads Per Month (Should be calculated against your CAC)
- Client Lifetime Value (What is a customer worth to your company?)
The main business acquisition ratio (in the fitness industry) to pay attention to when the customer pool is sparse and the marketplace saturated is your CLV to CAC. A CLV:CAC ratio of 1:1 means that a customer ends up paying you exactly what you paid to acquire them. You’d make the exact same amount of money by doing nothing at all. If your CLV to CAC ratio is less than 1:1, something is way off!
Why is Balanced Habits so invested in others’ success?
Because that’s what “partners” do. We partner with strong fitness clubs focused on growth. To date we have worked with over 150 different clubs all across the US and Canada that were ready to take their company to the next level of success. No two clubs are exactly alike, nor are their communities, but they share one thing in common: They all have “a strong desire to support people to live a higher quality of life,” which coincidentally happens to be Balanced Habits’ Mission statement.
Simple, right? I am confident Balanced Habits has what you need to get those three things easier and faster than you could imagine.