No matter how closely you monitor you financial performance, it may not be enough. Today’s climate and fast-paced uncertainty demands even closer scrutiny, more frequent and more focused analysis.

Here we explain you how to monitor the financial performance of your company. Which financial KPIs do you need to monitor? How to collect the relevant data? And how often do you need to evaluate your performance?

  • EBITDA: Is a measure of a company’s overall business performance, showing earnings before accounting and financial deductions.
  • Working capital: Is a measure of financial resources needed by a company to ensure its production cycle and its repayment of both debts and operational expenses.
  • Debt ratio: Is the proportion of a business’ assets that are financed by debt. This ratio measures the extend of your business’ leverage.
  • Free cash flow: It shows how much money a company is able to generate after paying for operations (salaries, supplies…) but also its capital investments.
  • Profit margin: It represents what percentage of sales has turned into profits.
  • Gross profit margin: Is the difference between the revenue linked to product sales and the cost of the sold goods.
  • Net profit margin: Is the ratio showing how much of each euro in revenue collected by a company translates into profit.
  • Self-financing ratio: It indicates the company’s ability to finance planned investments from its own resources.

Collecting relevant business data is a team effort. Therefore, this is very important to include your team in this process:

  1. Schedule regular reports from your teams, not just operations but sales and marketing as well.
  2. Centralise the data in one single file and make it easily accessible on a desktop digital dashboard.
  3. Analyse this data to gauge past performance and make future predictions.
Cash flow is something you should check on a daily basis because it will help you to manage your expenses. Our advice is to evaluate performance and adjust targets for the immediate future on a monthly basis, seasonal performance on a quarterly basis, and annually to understand what changed since you set the year’s goals, and why.

Protecting your company has never been so important than now. Especially in this crisis period, you are never safe from the default of payment or the insolvency of one of your customers. Very often bad payments and insolvencies lead to a snowball effect.

A trade credit insurance protects your business against the risks of defaults of payment and insolvencies of your customers. You can look towards a prosperous future:

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We monitor the financial health of your customers

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We take care of the collection of your unpaid invoices

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