Tracking key performance indicators, or KPIs, is vital for the health and success of your business and reaching your business goals. KPIs can show you where you excel and where your business may need help.
We have put together a few types of KPIs to help you effectively monitor your HVAC, electrical, and plumbing businesses success.
One of the most critical metrics you can track is your financial KPIs. These directly relate to how profitable your business is and how much money you make.
- Revenue Growth: It is important to see a trend upward in your revenue growth each month, meaning you are booking more jobs or higher dollar jobs.
- Gross Profit Margin: This metric measures how well your business turns its sales into profit and how much it makes after paying for the direct cost of doing business. The higher the margin, the better because you are making more money.
- Average Ticket Size: The more your technicians can upsell in the field to increase their average ticket size, the more money in your pocket.
- Cost of Goods Sold: Make it a point to audit your cost of goods sold, or COGS, once a quarter. By examining how much you are spending on particular products and services, you may identify an area where you can cut costs.
- Response Time: Seeing how quickly your business can dispatch a tech to a customer who has a demand or service call is necessary to note, especially if you have any guarantee in place. The quicker, the better when getting techs to the job site, so examine your average response rate and brainstorm ways you can improve upon this metric – like adding an additional truck.
- Job Completion Rate: The number of jobs completed directly correlates to your gross profit and margin, so you want this number to be high.
- Warranty Claims: Track and review the amount of warranty claims customers make on products. If one product has a high number of warranty claims, consider replacing it with a better product to avoid the claims.
- Customer Satisfaction: You should have a system in place to follow up with customers once a job is complete to gauge their satisfaction levels. This is a great learning opportunity to see where you and your team can improve.
Employee Performance KPIs
- Technician Efficiency: Measuring the number of jobs and how long it takes your techs to complete each job can provide you with valuable insight. You may need to offer additional training to certain techs so they can become more efficient with service or installation calls.
- Employee Turnover Rate: Recruiting and training new talent is expensive. Monitoring your turnover rate will give you an insight into how often and why employees may leave your company. Consider conducting exit interviews with staff who decide to leave to gather their feedback on what you could do to improve working conditions and entice people to stay.
- Safety Incidents: Keep track of any time one of your employees or technicians is involved in a workplace safety incident. Use these as learning experiences to improve your safety protocol and practices.
Marketing KPIs and Lead Generation
- Lead Conversion Rate: The number of leads that turn into actual, paying customers is very important to note. If you are getting a lot of leads but don’t have a good conversion rate, you may want to modify your marketing efforts to get better-quality leads.
- Cost Per Lead: Analyzing the amount of money you spend versus the amount of leads you get is an important metric. Ideally, you want your cost per lead to be low, meaning you are getting a lot of leads.
- Marketing Campaign ROI: For each marketing campaign your business launches, you should measure the ROI or your Return on Investment. You can do this by looking at how much you spend on each campaign and how much revenue or profit you get from the leads that were brought in on that campaign.
While this may seem like a lot of information, these are all important metrics to measure. Consider implementing just a few KPIs each quarter so you understand how to measure each effectively. Once you get that down, you can use the information you gather for these KPIs and turn them into actionable results to make your business better and more profitable.
It is important to measure your progress and improvement of each KPI. As your KPIs improve, you will reach new heights in your business.
Successware has resources built into our platform to help you track these KPIs. Learn more here and don’t forget to check out the rest of our KPIs | What to Track and Why series. We have blogs dedicated to tracking: