The 10 numbers every business owner should know by heart

Every business generates hundreds of numbers. Only a handful tell you what you actually need to know. The owners who stay in control aren’t necessarily the best at accounting — they just know their ten numbers, roughly, at any moment, and notice when one of them moves.

Here’s the list, grouped into four questions: Can we pay our bills? Are we making money? Could we survive a knock? Are we disciplined?

Can we pay our bills? (Liquidity)

1. Cash in the bank — and your minimum

Your total business bank balance today, compared with the minimum you never want to drop below. The gap between the two is your breathing room.

2. Cash runway

Available cash ÷ average weekly net burn. If you’re spending more than you bring in, how many weeks until you run out? If you’re cash-positive, runway is less relevant — but check the lowest point in your 13-week forecast instead, because lumpy payments like BAS can still cause a dip. Our guide to cash burn rate explains the calculation.

3. Debtor days

Trade debtors ÷ credit sales × days in period. How long, on average, customers take to pay you. If your terms are 14 days and debtor days are 41, your real terms are 41 days.

You don’t need to be an accountant to track these numbers, and you don’t need precision to the dollar. Rough, consistent figures reviewed regularly beat perfect figures reviewed once a year. The value lies in noticing direction: which numbers are improving, which are slipping, and which have quietly moved without anyone noticing. A simple spreadsheet with a row for each number and a column for each month is enough to start.

Are we making money? (Profitability)

4. Gross margin

(Sales − direct costs) ÷ sales. The share of each sale left to pay overheads and profit. Track it monthly, by product or service line where you can. Small slips here have big effects — see improving gross profit margin.

5. Break-even sales

Fixed costs ÷ gross margin %. How much you need to sell each month before making a cent. Knowing it turns hiring, lease and pricing decisions from guesses into arithmetic. Our break-even guide walks through it.

6. Net profit margin

Net profit ÷ sales. What’s left for the owners after every cost, including a fair wage for your own work. If you don’t pay yourself a wage through the business, deduct a realistic one before judging this number.

Could we survive a knock? (Resilience)

7. Largest customer’s share of revenue

Revenue from your biggest customer ÷ total revenue. If one customer accounts for a large slice of your income, losing them would hurt badly — and buyers and lenders notice. Our feature on losing your biggest customer covers how to reduce the risk.

8. Days of stock

Average stock at cost ÷ (annual cost of goods sold ÷ 365). For businesses that hold inventory, how many days’ worth of sales are sitting on the shelves. Too many days means cash parked in boxes. See stock and cash flow.

Seeing a number here you don’t like — and wondering whether funding could buy you time to fix it? Check your options; there’s no credit check to enquire.

Are we disciplined? (Habits)

9. Tax set aside vs tax owed

The balance of your tax account against what you’ll owe on the next BAS and PAYG instalment. If the account is short, you’re using the ATO’s money as working capital. Our guide on how much to set aside for tax shows how to size weekly transfers.

10. What the business pays you

Your regular pay from the business — wage, drawings or dividends — compared with what you’d need to pay someone else to do your job. If it’s far lower, the business is quietly subsidised by your unpaid labour. Our feature on how to pay yourself covers the options.

What does a one-page scorecard look like?

Put all ten on a single page and update it on a regular cycle.

#	Number	Formula	Review	Illustrative
1	Cash vs minimum	Bank balance − minimum	Weekly	$48,000 vs $30,000
2	Runway / lowest forecast balance	Cash ÷ net burn, or 13-week low	Weekly	Low of $26,000 in week 7
3	Debtor days	Debtors ÷ credit sales × days	Weekly	38 days
4	Gross margin	(Sales − direct costs) ÷ sales	Monthly	41%
5	Break-even sales	Fixed costs ÷ gross margin	Monthly	$61,000 a month
6	Net profit margin	Net profit ÷ sales	Monthly	9%
7	Largest customer share	Top customer ÷ revenue	Quarterly	22%
8	Days of stock	Stock ÷ daily cost of sales	Monthly	47 days
9	Tax set aside vs owed	Tax account − liabilities	Weekly	+$2,100
10	Owner’s pay	Regular pay vs market wage	Quarterly	On plan

The figures are illustrative. Your weekly numbers fit neatly into a 30-minute money routine; the monthly ones into a slightly longer review with your profit and loss.

How do you get the numbers without an accountant?

Most accounting software produces everything you need:

• Bank balances — from bank feeds.
• Debtors — the aged receivables report.
• Gross margin and net profit — the profit and loss report, set up with direct costs grouped above gross profit.
• Stock — your inventory report or last stocktake.
• Customer share — a sales-by-customer report.

The first time takes an hour or two. After that, it’s minutes. If your profit and loss is hard to read, our guide to reading a profit and loss statement will help you set it up properly.

What do the numbers say to a lender?

Lenders ask many of the same questions. Is turnover steady? Do bank statements show the business paying its way? Is there a margin to cover repayments? Are there overdue tax debts? Is the business dependent on one customer? Owners who know their ten numbers answer those questions quickly and confidently — and that makes the whole process smoother.

Which number should you fix first?

When several numbers look weak, order matters. A sensible sequence:

1. Cash and runway first. If the lowest point in your forecast is below zero, nothing else matters until that’s solved — collections, timing and, if needed, funding.
2. Tax set aside next. Using the ATO’s money as working capital builds a problem that grows every week.
3. Debtor days. Faster collection is the cheapest cash you’ll ever find.
4. Gross margin. Small improvements here lift every other number. Start with the price-rise calculator.
5. Break-even and net margin — the structural fixes: overheads, pricing, product mix.
6. Concentration, stock and owner’s pay — the longer-term resilience work.

Pick one number, improve it for a quarter, then move on. Trying to fix all ten at once usually fixes none.

If you only have time for one habit this month, start by writing down numbers one, three and nine every Monday: cash against your minimum, debtor days and tax set aside against tax owed. Those three alone catch most of the problems that turn into emergencies. Once they’re routine, add the monthly profitability numbers, then the quarterly resilience checks. Within a quarter you’ll have a scorecard that tells you more about your business than a year of glancing at the bank balance.

Numbers first, then the next move

Knowing your numbers doesn’t just prevent problems. It shows you opportunities: the margin to support a hire, the runway to take on a big contract, the break-even that makes a second site viable. When one of those opportunities needs capital, you’re ready to have a clear conversation about it.

We consider trading businesses for unsecured and line-of-credit facilities typically from $5,000 to $500,000 and property-secured loans from $20,000 to $5,000,000. Making an enquiry doesn’t involve a credit check, and your details aren’t sent out to a crowd of lenders — one team handles it. A real person reads your numbers and calls to talk through what’s possible. The more accurately you fill in the form, the more useful that first call will be.

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