3 Important Parts Of Every Dashboard

In creating a dashboard, just about every business owner should concentrate on three important areas:

1. Growth. Hey, who doesn’t aspire to growth?  But, if not planned for and controlled, companies can literally grow themselves right out of business. To manage your growth, monitor:

  • Debt to Equity: Total Debt / Shareholder’s Equity
  • Debt to Tangible Net Worth: Total Liabilities – Debt / Net Worth – Intangible Assets + Debt

2. Cash flow. Poor cash flow, not slow sales or lagging profits, is one of the leading causes of business bankruptcy. To help circumvent future cash flow squeezes, keep a close eye on:

  • Current Ratio: Current Assets / Current Liabilities
  • Days Sales Outstanding (DSO): Number of Days × Accounts Receivable / Credit Sales

3. Inventory. Many companies waste valuable cash by allowing slow-moving inventory to sit idle on their shelves for too long. To more carefully watch your inventory, track:

  • Inventory Turnover: Cost of Goods Sold / Average Inventory
  • Average Days to Sell: 365 / Inventory Turnover Ratio