What are Finance metrics? Identifying the optimal Finance metrics can be challenging, especially when everyday tasks consume your time. To help you, we've assembled a list of examples to ignite your creativity.
Copy these examples into your preferred app, or you can also use Tability to keep yourself accountable.
Find Finance metrics with AI While we have some examples available, it's likely that you'll have specific scenarios that aren't covered here. You can use our free AI metrics generator below to generate your own strategies.
Examples of Finance metrics and KPIs 1. Revenue Growth Rate Measures the percentage increase in revenue over a specific period, indicating business expansion and success
What good looks like for this metric: 10-25% annually for small businesses
Ideas to improve this metric Enhance marketing strategies Diversify income streams Optimize pricing models Improve customer retention Expand product or service offerings 2. Customer Acquisition Cost (CAC) Represents the total expense incurred in acquiring a new customer, essential for evaluating marketing efficiency
What good looks like for this metric: $50-150 for small businesses
Ideas to improve this metric Leverage referral programs Utilize social media marketing Optimize sales funnel Focus on targeted advertising Improve lead conversion rates 3. Customer Retention Rate Indicates the percentage of customers who stay with a business over a given period, reflecting customer satisfaction and loyalty
What good looks like for this metric: 50-80% for service-based businesses
Ideas to improve this metric Enhance customer support Implement loyalty programs Request regular feedback Personalize customer communication Increase service quality 4. Net Profit Margin Calculates the percentage of revenue that remains as profit after all expenses are deducted, showing the efficiency of the management
What good looks like for this metric: 10-20% for small to medium enterprises
Ideas to improve this metric Reduce operational costs Increase sales volume Evaluate supplier contracts Optimize inventory management Automate standard processes 5. Employee Satisfaction Assesses how content staff members are, which can influence productivity and company culture
What good looks like for this metric: 70-80% satisfaction rate
Ideas to improve this metric Conduct regular surveys Improve work-life balance Provide professional development Offer competitive benefits Encourage a collaborative environment
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1. Customer Acquisition Cost (CAC) The cost of acquiring a new customer, calculated by dividing total marketing expenses by the number of new customers acquired.
What good looks like for this metric: Varies greatly, often between $5-$100
Ideas to improve this metric Optimise marketing campaigns Leverage social media and word of mouth Increase conversion rates on landing pages Experiment with cost-effective advertising channels Focus on customer referrals and discount programs 2. Monthly Recurring Revenue (MRR) The predictable revenue expected every month from subscription services or regular sales.
What good looks like for this metric: $0 in month one, with rapid growth expected
Ideas to improve this metric Introduce subscription-based services Enhance product features to retain users Upsell to existing customers Expand market to new customers Regularly assess pricing strategy 3. Customer Retention Rate The percentage of customers a company retains over a specific period.
What good looks like for this metric: 60-70%
Ideas to improve this metric Offer excellent customer service Maintain high-quality products Engage customers through regular communication Implement a loyalty or rewards program Regularly collect feedback and adapt 4. Net Promoter Score (NPS) A metric to gauge customer satisfaction and loyalty on a scale from -100 to 100 based on likelihood to recommend.
What good looks like for this metric: Above 20 is considered good
Ideas to improve this metric Regularly survey customers about their experience Implement customer feedback quickly Enhance product offerings based on feedback Improve customer support processes Build a community around your brand 5. Burn Rate The rate at which a company is spending its capital before generating positive cash flow.
What good looks like for this metric: Typically 1-2 years runway
Ideas to improve this metric Optimise operational efficiency Prioritise spending on revenue-generating activities Regularly review and adjust budget Seek additional funding if necessary Monitor cash flow closely
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1. Process Time Reduction Measures the reduction in time taken to complete the billing process after automation compared to before.
What good looks like for this metric: 30% reduction in process time
Ideas to improve this metric Use programmable robotic process automation tools Integrate with existing accounting software Utilise cloud computing for scalability Streamline data entry with OCR technology Implement a database for template management 2. Error Rate in Billing Assesses the percentage of billing errors post-automation compared to manual processes.
What good looks like for this metric: Under 2% error rate
Ideas to improve this metric Implement validation checks Conduct regular training for software use Use automated reconciliation methods Regularly update software for accuracy Use real-time data error alerts 3. Cost Savings Calculates the reduction in costs due to automating the billing process.
What good looks like for this metric: 20% cost reduction
Ideas to improve this metric Optimise software licenses Reduce paper and printing expenses Automate repetitive tasks to reduce overtime Conduct a cost-benefit analysis regularly Invest in preventive maintenance 4. Employee Productivity Measures the increase in productivity of employees as a result of reducing manual billing tasks.
What good looks like for this metric: 15% increase in productivity
Ideas to improve this metric Reallocate time savings to skill development Schedule regular feedback sessions Use productivity tracking tools Encourage a culture of continuous improvement Provide resources for professional growth 5. Billing Accuracy Rate Monitors the percentage of bills processed accurately after automation.
What good looks like for this metric: 98% accuracy rate
Ideas to improve this metric Ensure comprehensive testing before full deployment Regular data audits Use machine learning for pattern recognition Integrate feedback loops for corrective action Keep detailed records of errors for analysis
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1. Net Profit Margin Calculated by dividing net profit by total revenue, expressed as a percentage. It shows how much profit a company makes for each dollar of revenue.
What good looks like for this metric: 10-20%
Ideas to improve this metric Reduce operational costs Increase product prices Enhance sales volume Improve customer retention Optimise supply chain 2. Return on Investment (ROI) Determines profitability by comparing the gain from an investment to its cost, calculated as (Net Profit / Cost of Investment) x 100.
What good looks like for this metric: 15-25%
Ideas to improve this metric Choose higher-yield investments Reduce investment costs Increase revenue from investments Enhance marketing strategies Improve financial forecasting 3. Gross Profit Margin Calculated by subtracting cost of goods sold (COGS) from revenue and dividing by revenue, expressed as a percentage, indicating the efficiency of production and pricing.
What good looks like for this metric: 20-40%
Ideas to improve this metric Negotiate better supplier terms Increase production efficiency Enhance sales and pricing strategy Reduce waste in production Control direct labour costs 4. Operating Profit Margin Measures what proportion of revenue is left as profit after accounting for operating expenses, calculated by dividing operating profit by total revenue.
What good looks like for this metric: 10-15%
Ideas to improve this metric Streamline operational processes Reduce administrative expenses Enhance revenue streams Focus on core business activities Minimise utility and overhead costs 5. Expense Ratio Expresses the percentage of total expenses to total revenue, highlighting cost management efficiency.
What good looks like for this metric: 60-80%
Ideas to improve this metric Implement cost-cutting measures Monitor expenses regularly Automate routine tasks Negotiate better vendor contracts Outsource non-core processes
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1. Data Entry Error Rate Percentage of financial entries that contain errors, calculated by dividing the number of inaccurate entries by the total number of entries
What good looks like for this metric: Less than 1%
Ideas to improve this metric Implement data validation rules Provide regular training for staff Utilise automated data entry tools Conduct regular audits Create a feedback loop for continuous improvement 2. Reporting Cycle Time Time taken to complete the financial reporting cycle, measured from the end of the reporting period to when the report is finalised
What good looks like for this metric: 15 days or less
Ideas to improve this metric Automate data collection processes Implement efficient workflow software Streamline approvals and reviews Set clear deadlines for each stage Regularly review and refine processes 3. Report Revision Rate Number of times a financial report needs to be revised after initial completion, divided by the total number of reports
What good looks like for this metric: Less than 5%
Ideas to improve this metric Standardise report templates Enhance internal review processes Use predictive analytics for forecasting Incorporate real-time financial dashboards Foster better inter-departmental communication 4. On-Time Financial Close Rate Percentage of times financial reports are completed within the designated reporting period
What good looks like for this metric: 95% or higher
Ideas to improve this metric Set clear and realistic closing deadlines Ensure adequate staffing during close periods Implement parallel closing processes Monitor and address bottlenecks promptly Use performance incentives to motivate staff 5. Cost Of Financial Reporting Total expenses incurred to complete financial reporting activities, including personnel, software, and other resources
What good looks like for this metric: 2-5% of total finance budget
Ideas to improve this metric Adopt cost-effective software solutions Optimise resource allocation Decrease manual interventions Leverage cloud-based reporting tools Regularly assess and adjust the budget
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1. Reporting Error Rate Percentage of financial reports containing inaccuracies or inconsistencies
What good looks like for this metric: Less than 1%
Ideas to improve this metric Implement automated validation checks Provide regular training to staff Use standardized reporting templates Conduct regular audits Improve data integration processes 2. Report Submission Time The average time taken to complete and submit financial reports
What good looks like for this metric: Less than 5 days post-period close
Ideas to improve this metric Streamline data collection processes Automate data consolidation tasks Set clear timelines and reminders Use a centralised reporting system Allocate dedicated reporting personnel 3. Data Reconciliation Time The average time taken to reconcile financial data from various sources
What good looks like for this metric: Less than 2 days
Ideas to improve this metric Integrate financial data systems Automate reconciliation tasks Regularly update and maintain data sources Conduct frequent interim reconciliations Use reconciliation software 4. Internal Control Effectiveness Measure of how well internal controls prevent inaccuracies and ensure data integrity
What good looks like for this metric: 95% compliance rate
Ideas to improve this metric Regularly review and update control processes Provide comprehensive training on internal controls Utilise internal control software Perform periodic control testing Establish a clear segregation of duties 5. Stakeholder Satisfaction Feedback from stakeholders regarding the accuracy and timeliness of financial reports
What good looks like for this metric: 90% satisfaction rate
Ideas to improve this metric Regularly solicit feedback from stakeholders Act on feedback to improve processes Engage stakeholders in reporting process improvements Use clear and concise reporting formats Provide timely updates and reports
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1. Energy Production (kWh) This measures the total kilowatt hours (kWh) of electricity generated by your system over a specific period
What good looks like for this metric: Typically between 5,000 to 20,000 kWh annually
Ideas to improve this metric Regularly maintain and clean solar panels or wind turbines Adjust the angle of solar panels to optimise sunlight capture Add more panels or a larger wind turbine to increase capacity Utilise energy storage systems like batteries for excess production Install energy monitoring systems for real-time data 2. Capacity Factor This is the ratio of actual output to the maximum possible output of the plant over a period of time, expressed as a percentage
What good looks like for this metric: Usually between 15% to 30% for solar power systems
Ideas to improve this metric Ensure optimal installation settings to maximise sunlight exposure Minimise system downtime through regular maintenance Use high-efficiency inverter systems Replace outdated or inefficient units Install in regions with higher solar or wind potential 3. Self-Consumption Rate This measures the percentage of self-produced electricity directly consumed by the producer rather than exported to the grid
What good looks like for this metric: Aim for 40% to 60% self-consumption rate
Ideas to improve this metric Increase the use of electricity during peak production periods Utilise scheduling features for household appliances Integrate battery storage systems to store excess energy Inspect and resolve any power mismatch issues Educate household members on energy-saving practices 4. System Efficiency This is the overall efficiency of the electricity generation system, calculated as the ratio of the total output energy to the total input energy
What good looks like for this metric: Aim for above 80% efficiency
Ideas to improve this metric Use high-efficiency solar panels or turbines Insulate connections and wiring to prevent energy loss Regularly check and clean system components Implement advanced technologies for energy optimisation Choose the right system size for your specific needs 5. Return on Investment (ROI) This assesses the financial returns of investing in self-produced electricity, calculated as the ratio of net profit to the initial investment cost
What good looks like for this metric: Typically a payback period of 5 to 10 years
Ideas to improve this metric Apply for government incentives and rebates Compare and select high-quality low-cost equipment Increase system durability to extend lifespan Reduce operational costs through optimised efficiency Regularly review and adjust financial strategies
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Tracking your Finance metrics Having a plan is one thing, sticking to it is another.
Don't fall into the set-and-forget trap. It is important to adopt a weekly check-in process to keep your strategy agile – otherwise this is nothing more than a reporting exercise.
A tool like Tability can also help you by combining AI and goal-setting to keep you on track.
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Tability's check-ins will save you hours and increase transparency
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