Any business, no matter how large or small, gathers data. It could be data on customers, suppliers or wider market trends, but each transaction produces data that can be used to inform decision-making. This is particularly true if your business has an online presence, and small business analytics enable merchants of any size to leverage the kind of business intelligence examples that bigger businesses have taken advantage of for years.
Why use business intelligence?
Business intelligence is a tool that enables any small business to take the data that comes in as a by-product of trading and use it in a productive manner. That involves not only gathering the data but also sorting it, visualizing it, and interpreting it in a way that makes it easier to act on. Although the specifics of small business analytics will vary from business to business and across different sectors, there are some by-products that apply pretty much across the board and these include the following:
The ability to analyze the behavior of customers
The ability to track sales by amount, type, and other metrics
The ability to track the revenue coming into the business and the relation of turnover to profits
The ability to spot operational problems as they emerge
The ability to spot trends in the wider market
Let’s take one example of how business intelligence can help. An e-commerce business can track the behavior of visitors to their website in order to analyze how many become customers and pinpoint the pinch points on the website that might be preventing this conversion. Various tools are available that will automate business intelligence to produce real-time, tightly focused data on visitor interaction with a website, making it easier to build a comprehensive understanding of issues such as whether the checkout process is deterring visitors. Other tools can be used to set targets for issues such as sales, revenue and profits.
The way in which data is gathered and analyzed as it comes into the business means that any chance of missing these targets will be flagged up in good time to do something about it.
How to make small business analytics work for you
Finding the right business intelligence tool for your business is important, as many are designed for larger businesses with bigger budgets and perhaps even a dedicated IT department. For a smaller business that wants to make use of business analytics without disrupting the day-to-day running of its operations, the choice of business intelligence tool should be governed by the following factors:
It has a user-friendly interface and makes it easy to present data in visual terms
It has the capacity to grow and change as your business does
It makes it easy to share relevant data with the members of your team who need to see it
The small business analytics to focus on
No matter which kind of business intelligence tool you opt for, there are certain key metrics that almost any business will have to base their data analysis around:
Traffic to their website and engagement with their social media platforms
Sales in general, with particular focus on repeat purchases and figures per day, week, and month
Logistics and delivery
We Can Help
If you’re interested in finding out more about using business analytics, or any other aspect of your business finances, then get in touch with our financial experts. Find out how GoCardless can help you with ad hoc payments or recurring payments.