Is your petroleum equipment service company set up to propel growth? If your reporting isn’t deep and unrelenting, scaling could leave your customers underserved and your company in chaos.
Luckily, tracking a few critical KPIs can help petroleum equipment companies expand, grow, and scale without being overwhelmed by demand or overtaken by costs. In this article, we dig into the most important reports petroleum equipment distributors need in order to track and manage growth.
What reports should growing petroleum equipment distributors track?
If your petroleum equipment distribution company isn’t tracking the right KPIs, opportunities for growth—and more revenue—are falling through the cracks. Thorough reporting gives petroleum equipment distributors a few critical capabilities:
- Manage growth, monitor demand, and lower costs
- Track service efficiency
- Streamline processes
- Control and lower overhead
- Maximize profit margins
Wondering what reports will have the biggest impact on your business? These are the reports petroleum equipment distribution companies should be tracking:
1. Revenue Generation
Revenue generation is important for planning growth strategies. As a high-level metric, it won’t tell you everything. For instance, just because revenue is on the rise doesn’t mean your costs won’t outpace those gains. However, because revenue feeds your operation, tracking revenue generation will show you how quickly you can afford to scale.
2. Cost per Acquisition
To calculate your cost per acquisition, start by adding up the total amount of money you’re spending on a marketing or advertising channel. Next, divide that total by the number of clients you’ve brought in from that avenue.
Knowing how much it costs to bring a customer is paramount because it proves your company’s sales and marketing ROI. It also reveals how much you should be focusing on free marketing channels versus paid advertising or sales efforts.
3. Average Revenue per Customer
To find your company’s average revenue per customer, divide your total revenue over a period by the total number of clients you provided service to. This metric is especially useful when it comes time to grow the company because it reveals how much your petroleum equipment service company can afford to invest. It also helps you map out revenue forecasting goals and plan marketing measures.
4. Annual Recurring Revenue
For petroleum equipment service companies, it may be easiest to divide up annual recurring revenue on a per-customer basis. First, identify a customer’s annual recurring revenue by dividing the total value of the contract by the agreed-upon duration of that contract. So, if a client has agreed to a five-year contract worth $10,000, the average recurring revenue is $2,000.
Annual recurring revenue has two main advantages. First, it helps you monitor progress and set goals. Second, it’s a reliable way to measure how well your team is landing new sales or upselling customers.
5. Customer Churn Rates
Customer churn can completely cripple any business. In the petroleum equipment service industry, it’s especially critical because increasing long-term customer relationships, upsells, and ongoing contracts are major growth drivers.
Measuring customer churn also can help you identify what areas of the business are missing the mark. For instance, if you’re noticing a high churn volume associated with a specific piece of equipment, it may be time to dig into the deeper problems causing consistent customer dissatisfaction with that product.
6. Net Profit
Net profit is one of the most telling metrics a petroleum equipment service company has to measure its financial health. It’s useful for everything from setting job costing and monitoring overhead to acquiring loans. To determine net profit, subtract your business’s total costs from total revenue.
7. Average Tech Response Time
Measuring average tech response time will reveal the daily holdups faced by your dispatchers, schedulers, or technicians. Inefficiencies in the day could be impacting your petroleum equipment service company more than you realize. One study by McKinsey & Company found field techs are wasting up to 40 percent of their workday. Average tech response time flags these inefficiencies so you can trim your processes, implement training, or make other tweaks that elevate efficiency.
8. First-Time Fix Rates
You probably already know how costly callbacks can be. Not only do low first-time fix rates siphon money out of the company, but they often lead to customer complaints. Measuring first-time fix rates in real time lets you set goals and see how well new scheduling or process improvements are paying off.
9. Work Completion Rates
Tracking work completion rates can illuminate everything from too much travel time or scheduling inefficiencies to gaps in your technicians' skill levels. By measuring this KPI, you can point out and eliminate the friction that’s causing inefficiency and lost revenue. Keeping a real-time eye on work completion rates reveals what process changes are driving bottom-line growth and where improvements still need to be made.
How can you streamline processes, grow, and scale your business?
Generating the right reports at the right time is critical to your business’s growth, but if you’re managing reports manually, it’s bound to cause errors and missed opportunities. Davisware software streams analytics and builds reports into clear visual dashboards. Plus, our all-in-one field service management software captures real-time data that feeds into interactive reports.
All of your business’s data flows into one platform. Because all-in-one software touches all parts of your company, it pulls in figures across everything from accounting and internal offices to scheduling, dispatching, and performance in the field. That means you avoid reporting gaps and have complete insights to drill down into.
Ready to see how all-in-one software can help your petroleum equipment service company track metrics, streamline processes, and scale? Schedule a demo today.