Top KPIs Every Business Should Re-Evaluate This Summer

Summer isn’t just for vacations and Q3 planning. It’s the perfect time to pop the hood and give your business a mid-year metrics tune-up. Why? Because coasting on outdated performance indicators can keep you from seeing what’s really working—or what’s quietly tanking your profitability.

Business climates change. Costs shift. Customer behavior evolves. And if you’re still measuring success using KPIs set back in January, you might be flying blind. Straight Talk CPAs works with businesses across industries that are growing fast or pivoting hard—and the first step in any good strategy is re-evaluating the metrics that matter.

Here are the top KPIs every business should revisit this summer, what they reveal, and how to track them for smarter decisions all year long.

1. Gross Margin

Why it matters:
Gross margin tells you how efficiently you’re producing and delivering your product or service. It’s the difference between your revenue and the cost of goods sold (COGS), expressed as a percentage.

Formula:

(Gross Revenue – COGS) / Gross Revenue x 100

How to track it:
If your costs have climbed—maybe due to supply chain disruptions or inflation—but your prices haven’t adjusted, your margins may have taken a quiet nosedive. Use accounting software to monitor gross margin trends month-over-month and flag sudden dips.

What to do this summer:
Reassess vendor contracts, renegotiate pricing, and identify areas where efficiency can be improved. If margins are tight, this is your cue to make strategic changes.

2. Customer Acquisition Cost (CAC)

Why it matters:
This KPI reveals how much you spend to acquire a new customer. High CAC isn’t necessarily bad—unless it's climbing while your revenue per customer stays flat.



Formula:
Total Marketing + Sales Spend / New Customers Acquired

How to track it:
Break it down by campaign, platform, or funnel stage. Tools like HubSpot, Google Analytics, or even QuickBooks paired with CRM integrations can help isolate where you’re spending the most—and what’s producing the least.

What to do this summer:
Evaluate the ROI of your advertising efforts. Cut or tweak underperforming channels, and consider doubling down on organic methods like SEO or referral programs.

3. Customer Lifetime Value (CLV)

Why it matters:
CLV shows the total revenue you can expect from a customer during their relationship with your brand. When paired with CAC, it helps answer: Are your customers worth what you’re paying to get them?



Formula:
Average Purchase Value × Purchase Frequency × Customer Lifespan

How to track it:
Use cohort analysis to measure buying patterns over time. Retention tools and customer segmentation reports can provide more precise projections.

What to do this summer:
Explore ways to increase repeat purchases—email campaigns, loyalty perks, or bundling services. If your CLV is low, it might be time to revisit your customer experience strategy.

4. Net Profit Margin

Why it matters:
It’s the gold standard for profitability. Net profit margin shows how much actual profit remains after all expenses are accounted for—including taxes, rent, and payroll.



Formula:
Net Profit / Revenue x 100

How to track it:
Regular profit and loss statements will give you this info, but comparing margins across different periods or service lines will tell you more. Straight Talk CPAs helps businesses dig deeper into margin fluctuations to uncover silent profit killers.

What to do this summer:
If net margins are shrinking despite healthy sales, start with overhead. Look at software subscriptions, underused staff hours, or bloated processes that need streamlining.

5. Accounts Receivable Turnover

Why it matters:
This KPI tells you how efficiently you’re collecting revenue. A slow turnover could signal cash flow issues—even if your sales look solid on paper.

Formula:
Net Credit Sales / Average Accounts Receivable

How to track it:
Your accounting software should flag overdue invoices and aging receivables. Run monthly reports and watch for clients or customers who consistently pay late.

What to do this summer:
Implement stricter payment terms, offer early-pay discounts, or automate invoice follow-ups. Getting paid faster = better cash flow = healthier business.

6. Operating Cash Flow

Why it matters:
Revenue is one thing. But do you have actual cash in hand to fund operations, cover payroll, or invest in growth? That’s where operating cash flow comes in.



Formula:
Net Income + Non-Cash Expenses – Change in Working Capital

How to track it:
Use your cash flow statement to monitor this regularly. A dip in operating cash flow might mean you’re overstocked, underpaid, or both.

What to do this summer:
Review spending patterns and align outgoing payments with incoming revenue. Consider short-term financing only if it bridges a predictable gap.

7. Employee Productivity Rate

Why it matters:
Especially for service-based businesses, your team’s productivity directly impacts your bottom line. Low productivity = higher labor costs per output.



Formula:
Revenue / Total Employee Hours Worked

How to track it:
Time-tracking tools and project management systems like ClickUp or Asana can help assess how much value each role contributes.

What to do this summer:
Identify process bottlenecks, redistribute workloads, or invest in automation to increase output without burning out your team.

8. Churn Rate (for recurring revenue models)

Why it matters:
If you’re operating on a subscription or contract basis, your churn rate reveals how many customers you’re losing over time.



Formula:
(Customers Lost During Period / Total Customers at Start of Period) x 100

How to track it:
Use CRM tools to monitor cancellations or contract terminations. Patterns often show up before people leave—like declining usage or longer support response times.

What to do this summer:
Rebuild your onboarding process, improve customer support, or introduce retention campaigns to reduce turnover.

9. Burn Rate (for startups and scaling companies)

Why it matters:
Your burn rate tracks how fast you’re spending capital—crucial if you’re pre-profit or relying on funding.

Formula:
Monthly Operating Expenses – Monthly Revenue

How to track it:
Keep a close eye on your runway. Use budgeting tools and forecasts to determine how long you can operate at your current pace.

What to do this summer:
Cut unnecessary spending and start prepping for the next funding round before you're down to your last few months of capital.

10. Website Conversion Rate

Why it matters:
Your site might get a ton of traffic—but are those visitors taking action? This KPI helps you measure marketing performance and lead quality.

Formula:
(Number of Conversions / Total Website Visitors) x 100

How to track it:
Google Analytics, Hotjar, and your CRM can track form submissions, sales, downloads, and other key actions.



What to do this summer:
Run A/B tests on landing pages, fine-tune CTAs, and ensure mobile responsiveness. Small tweaks often lead to big lifts.

Final Thoughts: Track Smarter, Grow Faster

KPIs aren’t meant to sit on dashboards gathering dust. They’re tools—powerful ones—that can spotlight problems before they snowball or uncover opportunities hiding in plain sight. By re-evaluating your KPIs this summer, you’re not just checking boxes—you’re future-proofing your business.

If you’re unsure where to start or your metrics feel more confusing than helpful, Straight Talk CPAs can help clarify the numbers and sharpen your strategy. Because good data doesn’t lie—but interpreting it right? That’s where the magic happens.