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  • Manage your profitability

    Hands pointing to a diagram


    Manage your profitability by building a sound reporting system for your business stakeholders.

    Having access to regular management information is critical to the successful operation of your business. You can only react to information productively when it's provided on a timely basis. How often this information is provided should be agreed with all your team, though it's recommended that it should be provided on a monthly basis. 

    A monthly management pack is prepared by the business for its own internal use and designed to meet the needs of those running the business. It's crucial for you as a manager to understand whether you are making a profit and how much. 

    It's important to understand where your business makes money and what needs to be changed to improve its profitability. It's equally important to understand the cash flow, because even profitable businesses can run out of cash. While there is no correct format for a management pack, it's recommended the information in the diagram below should be included.

    Diagram showing the principles of monthly management


    The monthly management pack is only useful when produced at the right time to analyse the details and to take appropriate action. As soon as possible after the month closes, you should expect to see the management pack for that month. The longer you leave it, the less useful the information becomes. Your management or board meetings should then be conducted with this information on hand.

    The monthly management pack and accompanying templates will help you to structure the information you need in order to make timely and relevant decisions about the financial performance of your business.