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Business Performance Report: How to Write a Business Performance Report?

A business performance report is a valuable business tool that provides an overview of how the business is performing. It combines information and analysis for forecasting revenues, expenses and profit for the upcoming year.

The business performance report is designed to assist the management in your business development. Data is collected from various sources and analyzed. This knowledge is used to improve business performance and for the identification of problems.

What this article covers:

What Do You Mean by Business Performance?

Why Is Performance Reporting Done?

How to Write a Business Performance Report?

What Do You Mean by Business Performance?

Business performance refers to how well your company is performing by comparing the results of initiatives to objectives and evaluating to what extent you met your targets.

The set of analytics processes and performance management that allows the improvement of business performance and achievement of business goals is known as business performance management. Instead of reviewing the performance of each division, business performance management looks at the business as a whole.

The purpose of business performance reports is to provide management with a clear and precise picture of the business performance. This includes the decoding the current performance levels, setting realistic goals, and evaluating the weaknesses to make improvements.

Every business has specific metrics that have to be monitored to improve business performance. For example, the primary operating variables for performance evaluation of a business could be sales and profitability.

Other key indicators of business performance are:

  • The market share and market ranking
  • The rate of customer acquisition
  • Liquidity and solvency ratios

Why Is Performance Reporting Done?

Understanding the business performance against goals and objectives is the key to running a successful business. Businesses need to continuously assess and report their targets, goals and objectives and make necessary adjustments.

To boost business process optimization, you need to measure and report different parameters such as customer satisfaction levels, sales, expenses and profits and the rate of inventory turnover.

The following are some of the key reasons why companies need to focus on performance reporting:

Benchmarking

Benchmarking encourages a business to be open to new methods that can improve efficiency and productivity while enhancing customer satisfaction. Performance reporting provides essential data that helps in analyzing and identifying new opportunities. Benchmarking also eliminates guesswork and provides resolution to specific problems.

Monitor the Workforce

The use of key performance indicators by businesses helps in controlling employee behavior and defines their performance. The managers are able to set goals and then asses the achievement of the goals. When there are some issues, feedback is provided to eliminate variances and improve conformity.

This not only improves employee performance and also helps in expanding the business process and strengthen cohesion among subordinates and the employer.

Preparing External Reports

Businesses have to prepare reports to comply with reporting regulations. This reporting could be compulsory such as annual reports or it could be voluntary where the company produces reports to help strengthen its corporate social responsibility. Performance reporting assists in the preparation of the external business reports.

Enhance Business Performance

Since performance reporting provides real-time information about the performance of a business, it can be used to reshape strategic assumptions and setting realistic targets that are achievable. Achievable and realistic goals improve employee morale and lead to increased productivity and profitability.

Improves Communication

By focusing on sales opportunities, performance reporting improves customer insights. The reports help business owners understand the needs of the consumers. It also helps investors understand the current status of the business performance and where it’s heading.

How to Write a Business Performance Report?

Here are some of the key elements that must be included in the business performance reports:

  • Objective and high-level goals of the company
  • The vision for the next five years
  • Measure or the key performance indicators
  • How the KPI lines up with the goals
  • How often should KPIs be measured, the data source that is used to monitor and measure this KPI and how the information would be shared (spreadsheets, graphs and slide decks)

Setting the business performance reports usually happens in the planning phase of the business. The business performance reports must be accountable, and time-bound. Whether you share a performance report daily, weekly, monthly, quarterly, annually or all of the above, setting up an effective report and monitoring is key to your success.

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