By Satish Patel
For most companies, the beginning of a new year signifies a time to take a retrospective look at the previous year and create goals and objectives for the year to come. This is a practice we adhere to at Analytix Solutions, as well. We are pleased with our 2011 successes, many of which we attribute to our ongoing client relationships and loyal client base. We are proud that our attrition rate remains at less than 5%.
Our 2011 revenue growth was 35%, and most of that growth was based on client and partner referrals. Not only did we acquire 30 new clients, most of our existing clients increased their commitment to the accounting services we provide or contracted with us to provide other complementary support services. In response to our clients, we also expanded our service offerings to meet client needs. Analytix Solutions became an Intacct Partner during 2011, which directly benefits clients who have outgrown QuickBooks and are searching for cloud based applications. We also launched a new, updated website and signed-on a few Partners to resell some of our accounting services. We thank all of our clients and appreciate their support.
For 2012, our goal is to continue to grow and prosper as a company. We have established a 30% target revenue growth goal. Our employee base has grown by 42%, and we are moving one of our facilities to larger space to accommodate our own internal growth and infrastructure requirements.
As we welcome the New Year, we would like to share with you our best practices for how we plan to further increase our own profitability in 2012.
1. Nurture existing client or customer relationships
There is an old business adage which claims that 20% of your customers generate 80% of your revenue. Do you know who your best customers are? Maintaining your existing customer base is less expensive than acquiring new ones. Focus on increasing business from your established clients based on the services they require to make their businesses run more effectively. Work to increase customer loyalty by providing them with rewards that recognize that loyalty. If you don’t already, maintain a database of your existing customers that includes their buying behavior patterns to assist you in acknowledging their loyalty.
2. Determine key performance indicators
Specifically, you should have a clear understanding of which metrics are critical to determining your company’s performance. Do you know what drivers directly impact your sales and cash flow? Is it a product’s average number of days in inventory? Labor costs? Always have a comparison for your performance indicators so that you know where you stand compared to the previous year’s indicators or industry benchmarks. Even more importantly, know the threshold for these indicators so that you can recognize underperformance in certain areas.
3. Review and analyze monthly financial statements
Make it a point to perform a realistic assessment of your financials each month. Pay attention to key performance indicators that you have established. If you don’t have time or the expertise to perform this function, hire someone with CFO level expertise on a part-time basis. Timely and accurate data is critical to decision making success. Establish a monthly objective to review your financial statements for the month prior by the 15th of the new fiscal month.
4. Increase efficiency
This can be best accomplished by automating processes wherever possible to eliminate manual functions that take employee focus off of value added services. Invest in software programs and applications that will help accomplish this goal, especially ones that assist with payroll, time and billing, and data entry.
5. Outsource non-core tasks to provide you with more time to run your business
Assess the time you and your employees spend on tasks that require completion but really add little value to your own customers and customer relationships. Focus on those functions which allow you to foster relationships and grow your business. At Analytix, we “walk the talk” and recognize our own limitations. We outsource non-core tasks that are not central to the services we provide to our own clients.
Integrating these five practices into your operations will assist in improving your profitability. We are currently offering a free analysis of your accounting business processes and accounting system. If you would like to learn more on how Analytix Solutions can help improve your profitability in 2012, please call me directly at 781.503.9002 or email me at [email protected].
Satish Patel, CPA
President, Analytix Solutions
Satish Patel, Founder-CEO of Analytix Solutions, has more than two decades of experience as a CPA. He has also advised small and mid-sized businesses on diverse matters such as valuation, accounting, and finance. His experience extends to raising capital and arranging for finance from angel investors.