Mid-Year Metrics to Monitor for Bookkeepers

The best bookkeeping firms always have a strong grasp on the key numbers that define the success of their business. But the midpoint of the calendar year is a great time to really dive into your firm’s numbers—especially if you don’t always keep as strong of a grasp as you should on your key performance indicators (KPIs).

As with many other areas of your bookkeeping business, some types of reporting and analytics are more important to pay attention to than others. If you’re looking to get a handle on the most important numbers that actually move the needle for your bookkeeping firm, we suggest keeping an eye on the metrics below.

Meetings and deals

Sales are important to track for all businesses, especially bookkeeping, where project engagements take up a significant portion of most of the team’s working hours. Whether you have a dedicated team to focus on company sales or handle most of it yourself at the ownership level, success with sales is all about meeting your key numbers. Before you can close the deal or negotiate with a potential new client, you have to start with an initial meeting.

These initial prospect meetings—sometimes listed in a CRM as a “deal”—are especially vital if you’re looking to grow the business.

You can calculate the specific number of deals you and your team should be working on by determining your average deal size, multiplying it by the number of deals you have open, and then multiplying that number by your close rate.

For example, let’s say you want to make $50,000 in a month, your firm’s average deal size is $10,000, and your sales team can close roughly 25% of all prospect meetings. By these metrics, you’ll need to have 20 monthly meetings or sales opportunities: 10,000 * 20 * 0.25 = 50,000.

Employee productivity rates

Some bookkeeping executives may worry about tracking employees. To be clear, we aren’t suggesting you micro-manage your team or see what they’re up to every minute of the day; what you should be doing is using metrics to monitor their broader performance.

One of the best numbers to start with is your team’s utilization rate. This metric indicates the amount of time your team spends on billable hours compared to the total number of working hours they have available.

A good baseline is about 80% utilization. If your team is above that, you can make slight adjustments to improve efficiency. If they’re below 80% utilization, it should initiate a longer investigation into how your firm manages project processes.

Another helpful employee metric to track is the amount of on-time deliverables and milestones you’ve delivered, sorted by client and type of project. This will help you understand challenges or obstacles faced by individual employees and specific clients or kinds of projects. You may find that things fall behind consistently on a particular type of project, so you probably need to re-examine how you handle them.

Forecast vs. actuals

It’s always important to be forward-thinking in your firm, but data from the past can be beneficial when it comes to determining how well you’ve been able to meet your targets. For any metric you’ve devoted time to tracking, whether it relates to revenue or internal productivity, you should also spend time reviewing how you performed relative to the forecast.

The discrepancies you identify here can say a lot about the overall state of your firm. If you seem to be drastically underperforming your forecast, you’ll need to decide if it’s an issue with actual performance or a problem with the targets you’re setting. On the other hand, if you continuously outperform your forecast, it could be a sign that you need to set your aim a bit higher.

Processes relevant to metrics

As you take time in the middle of the year to think about your firm’s key performance indicators, remember to likewise review the way you organize, access, and analyze these numbers. If you have to jump around to several different programs and manually export the data, you’re probably taking more time than you should to interpret your firm’s metrics. This puts a drag on your time and reduces productivity across other parts of your work.

Instead of handling all of your data in disparate platforms, think about consolidating this information using a single software suite that can help you handle various tasks, from employee time tracking to project management dashboards to invoicing.

Equipping your firm with a suitable accounting practice management software package can give you the ability to track all of your most important metrics in one place, which will ultimately help your business hit key targets and survive any challenge you may face in the future.

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