Question

You are the management accountant at your local Sports Centre. Identify a range of appropriate non-financial performance indicators for the centre which, when taken in conjunction with traditional financial indicators, would provide a comprehensive assessment of performance.

Answer 1

The following NON FINANCIAL performance metrics could be used

1. Customer retention ratio
Customer retention ratio is the rate at which the store is able to retain its customers. If 100 customers started shopping from the store at the beginning of the year, how many of these were still buying from the store?
Such a ratio would give the retention rate and see how successful a business is in terms of retaining the customers. It also shows customers satisfaction and establishes a long term relation.

2. Conversion rate
Another important non financial metric is the customer conversion rate. It measure how many enquiries were made and how many of those were then converted into actual sales.

3. Satisfaction rate
How satisifeid a customer is also indicates a lot about performance. After all it is all customer driven. Happy customer would mean better performance.

4. Monitoring the channel of sales
An important aspect in the modern world of business is to monitor the methods the customers are using to buy. Are they buying stuff online or are the visiting the store physically? Such metrics help in better understanding of the customers as well as the markets.