Gross Profit
Name 1 of the 5 Best Practices to maintain a solid positive Labor trend.
What is:
1.Maintain a good revenue mix with more profitable patrol model
2.Service Reviews and Annual increases
3.Maintain officer efficiency and manage OT
4.Not over staffing locations or overhead staff
5.Keep bill rates and pay rates in alignment with proper margins
Providing clients with reports, check-ins, and transparency about the value of services helps meet this goal tied to labor efficiency.
What is client satisfaction?
Timely billing, correcting errors quickly, pre-billing reminders, and negotiating favorable terms all help reduce this KPI Target.
What are ways to improve the results to be below the 35 days Target ?
When working with customers payments for their invoices are encouraged to be submitted in the most efficient way to improve quicker cash flow.
What is ACH/EFT
Performing annual service reviews and using rate increase tools are examples of these types of actions to improve labor efficiency.
What are management practices?
Gross profit helps a business understand how much money it makes before paying these extra cost like rent and sales.
What are operating expenses.
Labor is the biggest expense for a franchise, and poor efficiency can lead to problems with this.
What is cash flow?
Name 2 of the 5 Best Practices to hit below the Target line of 35 days
What is?
1.Maintain a good relationship with clients and be proactive in resolving service issues
2.Negotiate favorable billing terms in sales process! Pre-bill, semi-monthly billing, Net 15
3.Pre-billing reminder calls or emails to clients
4.Process billing timely and accurately
5.Correct billing errors timely
The target for this KPI is to keep it under this percentage.
What is 3%?
This KPI is calculated by multiplying Patrol and Dedicated Revenue by their payroll targets (34% Patrol, 64% Dedicated) and comparing it to actual officer payroll.
What is Labor Efficiency KPI?
If a company sells a product for $100 and it cost to produce the product is $60, This is the gross profit amount.
What is $40.00
Labor efficiency KPI compares payroll targets to this actual cost in the business.
What is officer payroll?
To qualify for the DSO KPI, a franchise must average at least this amount in monthly revenue.
What is $10,000 per month?
Long delays in collecting accounts receivable can hurt this aspect of the business.
What is cash flow?
This KPI measures how quickly a franchise collects cash by dividing average month-end accounts receivable by 12-month revenue and multiplying by 365.
What is Days Sales Outstanding (DSO)?
This word describes how "healthy" a company's gross profit is compared to it's sales-Typically know as percent.
What is Margin
Using rate increase tools, performing service reviews, following the CBX process, and providing transparency to clients all help improve this KPI.
What are ways to improve labor efficiency?
A lower DSO means this important financial benefit—cash comes in faster and isn’t tied up in receivables.
What is strong cash flow?
Making sure billing addresses and emails are correct is an example of doing this to reduce AR90.
What is maintaining accurate client information?
This KPI is calculated by multiplying Patrol and Dedicated revenue by their payroll targets (37% Patrol, 70% Dedicated) and comparing it to actual payroll.
What is the Gross Profit KPI?
To Qualify: Must have officer payroll in each month of the rolling 12-month period and average 10k revenue per month
What are the qualification requirements for the Gross Profit KPI?
This is the single biggest expense to franchisee's business
What is Labor
What are the number of days in a month that are Averaged for Days Sales Outstanding
What is 30.42
Reviewing aging reports, visiting clients during management changes, and keeping documentation current are ways to improve this KPI.
What is AR over 90?
This KPI is calculated Accounts receivable over 90 days divided by total accounts receivable
What is AR over 90