Last week I gave you the history and reason for the space race to the moon.
This week I give you the 8 questions you need to answer to rocket your profits.
Here they are:
#1. Productivity – For every dollar you take in the door, how much do you spend on payroll and payroll taxes?
This ratio includes all payroll – field, office, and owners. Don’t include any benefits in this calculation. Payroll taxes are FICA, Medicare, and unemployment.
#2, Net profit per unit of revenue or billable hour – For each unit of revenue or billable hour how much profit do you generate?
Determine 2024 total billable or revenue producing hours. Do not include holidays, vacation, meeting, training or unapplied hours. Then take your net operating profit and divide it by your billable hours. This is your 2024 net profit per hour. If you don’t like the number, your first rocket goal is to increase it to a number you are comfortable with.
#3. Overhead cost per hour – for each unit of revenue or billable hour, how much overhead cost is there?
To determine this number, take your department or company overhead and divide by billable, or revenue producing units or hours that you calculated for net profit per hour.
#4. What is your average project revenue?
#5. What is your recurring revenue enrollment percentage?
For every opportunity you have to talk to a customer about your recurring revenue program, how many enroll?
#6. What is your recurring revenue renewal percentage?
#7. What is your sales closing ratio?
#8. Job cost a minimum of 20 jobs chosen at random.
What was the net profit per unit or hour for each of these jobs?
Make sure your employees are on board with the goals. Tell them “what’s in it for them” so they help you achieve the goals.
The First Time Manager – Sales, gives great ideas for a person who has been in sales and promoted to sales manager.
However, this advice is great for any field or office person who is promoted to manager!
Click here to order on Amazon