Many of them put a lot of effort in during their day, and due to this, they feel squeezed for time to analyze the performance of their business.
However, this should not be overlooked and as an agency owner, you should take the plunge periodically to assess what brought the business this far, where it is heading to, how the business is doing on sales and customer service, what the bottlenecks are, and what course of corrections are needed to achieve individual objectives.
The only resolution to all such worries is tracking and monitoring the right metrics. We all know that numbers don’t lie and when it comes to home care business, metrics prove to be valuable in saving time, providing real-time performance data and detailed insights with the help of home care software. It will help to identify areas that need focus and extra effort for desired results. Below, we have listed some key metrics that a home care agency should be tracking to operate efficiently.
Sales per Employee (Full-time)
The metrics of sales per employee will allow comparing the revenue that the agency is bringing in for each full-time employee working for it. Equating sales per employee against industry averages can help figure out whether you have too many overhead costs and are losing profits by operating inefficiently. To calculate this, divide the total annual revenue by the total number of employees. If there are part-time employees as well, count them as half, or 0.5.
Cost of Client Acquisition from Referrals
Calculating the cost of client acquisition from referrals will reveal the total spending involved in getting a client from a referral source. This serves to figure out the highest ROI from specific sources. To determine these figures, divide the total cost of marketing through a particular channel in a given period (be sure to include the hours spent by your team in this calculation) by the number of clients acquired from this source in the same period.
Cost of Hiring a Caregiver from a Recruitment Source
This will reveal how much money is spent while hiring a new caregiver from a recruitment source including online job boards, recruitment drive, and job consultants. For a home care business, it will help to identify the best source that yields the highest ROI. To figure out the exact amount, divide the total cost incurred while hiring from a specific source with the number of caregivers hired in a designated period.
Inquiry to Conversion Ratio
The inquiry to conversion ratio is the most important metric a home care agency should be calculating periodically to understand business performance and where it is falling short. It is done to calculate the percentage of inquiries coming in for services and who are turning in to sales. If there is something that is causing people not to use your services, the calculated result will reveal it. This is the crux of the entire business, and all the efforts should focus on increasing the inquiry to conversion ratio.
These are not the only metrics a home care agency should track and monitor; there are more depending upon the nature of the business, locations covered, and years in business. The sole objective of generating these numbers is to give you a fair idea of how well your agency is doing and if there are issues that require action.
Is your home care business equipped with a home care business management solution that helps you track and monitor key aspects of your business? If not, we can help you. Talk to us now.