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The information your leadership team generates through reports can inform your budgeting, resource allocation, and decision-making in every aspect of your business. In addition to real-time performance data visualizations, reporting may be the most important feature of any ERP solution.
So which reports should you run regularly in addition to the obvious general inventory report, balance sheet, and P&L statements? Here are eight (representing a variety of business functions) we believe are absolutely crucial for SMBs in any industry. Four of them you can run directly from your ERP system.
Four crucial reports you can run from your ERP system
Accounts Receivable Aging Report: This report enables your A/R personnel to stay on top of collections. One of the most common problems for SMBs is cash flow, caused by poor or inconsistent monitoring of accounts receivables. We recommend running this report weekly. In addition to reporting and grouping according to number of days past due, your company should have an escalating series of communications that aligns with days past due.
Inventory Ranking Report: This is your ranking of inventory in descending order according to gross margin. This report is necessary to understand the relationship between profitability and holding costs, so that you can determine if the overhead justifies continuing to sell each product. If cash flow is an issue, this report is absolutely essential to run at least monthly.
Sales Pipeline Report: This report allows you to keep track of all your current, pending, and future sales, so that you can make accurate forecasts and set estimated closing dates. Running this report weekly will enable you to see specific sales conversions throughout the sales cycle, so you will know when your team is generally effective at converting a prospect to a sale or generating additional sales from current customers. Are they converting after sales visits, after online research, or after subsequent calls? This report shows what activities matter in the sales process and which activities should be improved. You will also be able to evaluate the performance of individual salespeople and be able to provide guidance at critical junctures.
Customer Churn Report: This report enables you to see which customers are churning, at what rate, and how many over a specified period of time. Running this report weekly enables you to act when customer subscriptions expire and are not renewed, or when customer buying patterns become slower. Too many businesses devote disproportionate resources to new sales and fail to do what is required to retain existing customers. Churn not only affects profitability and growth, but also reflects the value of your products and services. There is also a strong correlation between high rates of customer churn and high rates of employee churn—because morale is affected by a poorly received line of products and services.
Four other crucial reports
Network Traffic: Think your employees are doing nothing but what they are paid to do? Think again. According to Interguard, 29% of employees spend two hours of time per week on unrelated work activities, 21% waste about 5 hours, and 3% waste more than 10 hours. That’s more than half the workforce making irresponsible use of their time and employer-provided online devices. Employees are checking social media, Googling, and shopping online—and they’ll probably increase their non-work activities if you don’t monitor and stop them. Your network traffic report will show you which devices are accessing which websites, when, and how often, so that you can act accordingly.
Marketing Lead Tracking: You may be running a variety of traditional and digital marketing campaigns, each with a set of promotional pieces. Your lead tracking report shows you in descending order, which promotions are driving leads, and where they are being driven including your website, phone support, or retail location. Combine this with the online conversion report (or store conversion report) for a more complete picture of your marketing effectiveness.
Website Traffic Report: This report enables your digital marketing team to understand the referring sources generating web traffic and the patterns of repeat visitors. Heat maps show you where the activity on your website is most robust. You’ll see where concentrations of online visitors click, read, and engage with your site tools and content so that you can further optimize your site.
Online Conversion Report: This report shows your leadership team how well your website is performing in terms of encouraging visitors to make a purchase. This helps sales and marketing track the sales funnel and optimize marketing and sales investments for the highest possible ROI. Plus, it enables you to see where there might be attrition, so that you can improve your website and continue the momentum generated from your marketing investments.
The better your leadership team can understand and communicate business performance, the greater the potential for your operation to become more efficient and profitable. It all starts with powerful ERP-generated reports.
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