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Implementing your Revenue Speedometer in Business

What revenue is your business making or what are you projecting to make? Imagine that you make a plan to make 10,000 dollars in  month. As a business this would  be a sound projection enough to meet your projected costs such as rentals, advertising, communication and wages. When you make the projections your aim is that the business should survive and meet your needs. What we must understand is that making money as a business is dependent on different factors however the most important is that the money must still come through, and knowing how much is coming through is critical for the success of the business.

Its Not Revenue it’s Purchases by the hour

Back to our example on revenue of $10,000. If supposedly your business is open for 26 days in a month and operates for 8 hours a day then you are expecting to be open for 208 hours in total for the month. Consequently what it means is that you are expecting to be making $10,000/208 hours=$48.08 per hour which is your revenue Speedometer. This means on a daily basis at the end of the day you are expecting to make $48.08*8.  When you are measuring your business for each day you can then measure your hourly performance in order to understand how fast your business is going or performing.

What does this all mean for business planning

What it means is that you must be able to measure your marketing so that it brings in the required customers on a daily basis to meet your quota of revenue expected per day and per hour. Your marketing effort therefore requires you to be able to judge how many people will come to you.

Let us look at the 4 Ps of Marketing and how they are affected


It means that you must have a product that people are willing to buy on a regular basis. You cannot bring a product that is not functional; part of business success is being able to provide what the customer needs and wants. So when one says I am targeting $10,000 in revenue it must mean that they have enough stock to meet the demands for receiving $10,000. One cannot say I am projecting $10,000 in revenue but they have stock only worth $4,000 in revenue and the stock only turns once in a month, meaning that they will never meet the target. Maybe the stock turn over might be high but if the lead or lag time for bringing in the stock is beyond thirty days then the revenue will never be met.


The customer is a mobile person who has preference as to where they would go and where they would not go. You don’t choose your market, the product chooses the market, you simply follow where the product is taking you. The place of operations is thus important in being able to create a partnership with the market. If you cannot create a partnership with your customers then you can not have a selling relationship. There might be a market for your product but if accessibility is a challenge then the product ceases to be a solution to the market.


The price of the product is critical for acceptability of the product with the market. If the product is not priced right no matter how you present the product it might be viewed as not suitable. If you are selling to a high end market and you price your product too low, the tendency is to think that there is something wrong or fake about the product. Another issue is to remember you are also selling to egos and for some a low price might not appeal to their ego. The opposite is true for  a low price. If the price is right then the hourly sale will be easier to meet your 10,000 dollar target.


To meet your hourly target you must be able to promote your product at the right times and know when to compensate for non-performing hours.How you communicate your product is important. It speaks to where you are found, how you are found, what you are offering, what price you are offering and what the market is willing to offer. Your timing in promotion must be spot on to be able to meet the demand for your hourly sales. Your promotion of any aspect of the product that you are selling must be linked with the target that you are trying to achieve. A promotion that has no target is a waste of business resources and will result in the business failing to meet its targets.

Measure your Business by the hour

As your business becomes serious you will need to measure it by the hour and by the minute. Knowing how each hour is performing will act as a trigger on putting the right promotion, or ensuring that the pricing is correct. Not knowing just leaves you susceptible to the end of the month discovery when there is no longer time to plan. You don’t plan when you have arrived, you plan before and during the journey.

Your costs are normally either fixed or variable or both. The fixed costs are always there with you, at the end of the month one must be able to pay for them, and your variable costs will depend on your operations. The real business success comes when you can continuously plan for the success of the business on an hourly basis. the target can be the same and the vision being the same, however the operations can change in order to meet the target. Changing the operations in the absence of target is a sure disaster for any business.

As much as all “Ps” for business can be put in place in this disregard the Performance must be measured as well. Not setting it in place with a proper rate is a recipe for disaster. Hence when implementing a business have a speedometer for revenue. The speedometer for revenue is what then is measuring how much revenue you are expecting per hour.

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