Owning a product-based business has unique challenges when compared to a service-based business. There are often a lot more moving parts as you have to not only work to get the product to your business, but then you also work on the other end to sell it to a consumer.

 

Each step often involves additional cost and finances can get a little convoluted if not properly tracked and managed. I am going to discuss some of the primary financial metrics that I think product-based businesses should be tracking to ensure adequate profitability. 

 

What you'll hear in this episode:

[0:50] Why product-based businesses are often more difficult to start than service-based businesses?

[2:05] Differences in financials between a product and service-based business.

[2:48] The #1 metric to determine if you are on the right track: gross margin.

[5:10] The #2 metric to determine if you are on the right track: analyzing trends of time for various SKUs.

[9:40] The #3 metric to determine if you are on the right track: inventory turnover.

 

Related episodes:

Questions to Ask Yourself as a CEO

Why You Want to Build a Sellable Business

Get Back In The Driver's Seat Of Your Business Finances

 

Tactical Resources:

5-Day Financial Mindset Refresh: https://www.keepwhatyouearn.com/refresh

Create a Custom Podcast Playlist: https://quiz.tryinteract.com/#/6303d4c525b1e80018d47cfa

Grow Cash Flow for Your Business: https://www.keepwhatyouearn.com/endless-cash

Tax Deduction Guide: https://www.keepwhatyouearn.com/tax-deduction-guide

CFO Power Session: Text POWER to 860-609-6374

See how much you can save with an S Corp: https://www.keepwhatyouearn.com/keep-what-you-earn-s-corp-calculator

 

Additional Resources:

Find everything you need at https://www.keepwhatyouearn.com

Questions about this episode? Text me!: https://my.community.com/shannonweinsteincpa

Hire us: https://www.fitnancialsolutions.com/accounting

Find me on IG https://www.instagram.com/shannonkweinstein/

Meet me face-to-face on YouTube: https://www.youtube.com/channel/UCMlIuZsrllp1Uc_MlhriLvQ

 

 

The information contained in this podcast is intended for educational purposes only and is not individual tax advice. Please consult a qualified professional before implementing anything you learn.