The five numbers every young business owner should know

Revenue is only the start. These five numbers tell a clearer story.

Start with revenue: all the money customers paid you. Next, track expenses: money spent on ingredients, materials, packaging, fees, and other business needs. Profit is revenue minus those expenses.

The fourth number is how many sales you made. The fifth is average sale value, which is revenue divided by the number of sales. If you earned $60 from three sales, your average sale was $20. That helps you see whether bigger orders or more orders are driving your results.

Record the same five numbers each week or month. A single big sale can make revenue look exciting, while missing costs can make profit look higher than it really is. Accurate records help you choose prices and decide what to make again.