5 Business Metrics to Watch for Company Growth

Sep 23, 2021

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Business metrics help leaders gain insight into different aspects of performance within an organization. There are many different metrics and performance indicators available.

Depending on what aspect of progress or performance one wants to see, there are different variables that should be taken into consideration. Here are five business metrics to help you measure your company’s growth.

The Top 5 Business Metrics

Customer Lifetime Value

Customer lifetime value measures the total revenue you can expect from a customer. This factors in the length of time they’ll do business with you, and the expected amount of purchases they will make.

This metric lets you project how much one customer relationship contributes to the longevity of your business. It also lets you know which customer segments are most profitable for your business.

In response, you can take action to influence every step of their customer journey to increase the value of your relationship with them. CLV is also used in designing loyalty programs.

Although there are many ways to calculate CLV, one way is to multiply Customer Value with your Average Customer Lifespan. Use this metric to find ways to increase average order value and customer lifespan.

The value you get is a direct determinant of how much growth your business can expect from your customer relationship.

Compounded Annual Growth Rate

An annual growth rate in any aspect of your business can be calculated as a compounded growth rate. It shows you the rate of return you need to reach to target a financial goal over a certain period of time.

This is especially important for businesses looking to get investors on board. Your compounded annual growth rate can help you make necessary decisions based on how close you are to your targeted growth rate.

Market Share Growth

Market share growth is a simple comparison of how much your market share has changed over a period of time. This metric shows you the growth in percentage, on how much of the market you have in comparison to your competitors.

You can then find out which factors affect the changes in your market share and enhance or resolve them for future growth.

Customer Retention Rate

With acquisition generally costing five times than retention, your customer retention rate becomes another important metric to watch.

This shows you how capable your business is of growing the number of repeat customers for your product. Existing customers are a great way to generate revenue for any business.

It doesn’t cost as much as acquisition, and the relationship is a great opportunity to find out what your primary customers actually want from you.

Monthly / Annual Recurring Revenue

Your recurring revenue lets you project how much value you can put into expansion efforts in the immediate future. If projected monthly, your Monthly Recurring Revenue (MRR) can tell you how much value your current customers will give your business in a month.

This can be used for strategic planning to influence your immediate growth rate. Especially if you’re an entrepreneur trying to hit monthly goals, this is a valuable metric you should be observing.

Projected annually, this becomes your Annual Recurring Revenue (ARR) and lets you see how much value your existing customers provide to your business. This business metric can also influence your loyalty program design and will let you know if your customer retention policies need strengthening.

list of top 5 Business Metrics


Growth Business Metrics

Business growth can also be measured by comparing your goals to your current achievements. Business metrics are here so you can single out exact parts in your process that directly influence the rate at which your business grows.

Customer base is a great indicator of how many people are buying from you. Customer lifetime value and customer retention can tell you if you are at a good place to start expanding.

For startup entrepreneurs, virtual assistants can be of great help by making sure your reports are regularly updated so you always have the correct calculations when you need them.

If you are interested in scaling your company with the help of a virtual assistant, then simply fill out this form, and one of our consultants will reach out to you.

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