Your LivePlan Small Business Plan – Milestones and Metrics


Milestones and metrics will help you determine if you are staying on track with your LivePlan small business plan.

Your LivePlan Small Business Plan - Milestones and Metrics

In this post, I lay out how you can go about creating milestones and provide an overview of how and why you should incorporate metrics into your plan.

Bill Gates co-founded Microsoft in 1975. He currently spends a majority of his time running the Bill and Melinda Gates Foundation, the largest transparently operated private foundation in the world.


An effective business plan will include several well-defined milestones to help gauge if you are staying on track.

I suggest incorporating some kind of chart or spreadsheet into your plan to organize and visualize your short and mid-term milestone goals.

LivePlan includes a Milestones Table, which makes it easy to do just this.

LivePlan includes a Milestones Table, which is a convenient way to organize your short and mid-term milestone goals.

Your milestones, like any goals you set, should be well-defined, actionable, measurable and challenging but achievable.

Quantify them whenever possible.

For instance, in the Milestones Table above for Embarkment Salon, there are several dates listed for hiring additional service professionals.

These milestones are well-defined and quantifiable.

In Embarkment Salon’s case, each milestone gets the owner one step closer to achieving her ultimate long-term goal, which is to sell the Salon and help fund retirement for her and her husband.

Like the rest of your plan, the milestones are not set in stone.

However, they play a key role in active planning.

If you are consistently missing them, you will need to understand why and adjust your plan accordingly.

Are you setting the bar too high?

Are you not working hard enough?

Or is there some other rational explanation?

This is what active planning is all about.

Set goals, work toward achieving them, regularly evaluate your success, adjust your goals when necessary and repeat.

You can get more details on this section and the Embarkment Salon example in the free supplement to this post here.

Then, get to work on identifying some key metrics your business can use to further help keep you on track.

Key Metrics

With the key metrics section of your plan we begin to get closer to what I consider my wheelhouse.  

We start to talk about numbers.

I spent the first decade of my professional career dealing with numbers day in and day out.

But this may be where you start to feel deterred.

You may be satisfied to leave all of the financial tasks involved in running your small business to someone else.

However, I highly encourage that you take an active interest in understanding how your business is doing financially.  

If you don’t, failure could blindside you.  

And if you are writing this business plan on your own or will be pitching it to lenders or investors, it is critical that you have a solid grasp of your numbers.

With LivePlan, it starts with defining key metrics.

If you develop expectations for key financial performance based metrics and experience periods where you are clearly missing the mark, it is easier to identify that something may be off.

Defining and understanding other metrics that aren’t directly based on financial performance will help you run your business more efficiently and effectively as well.

So what are key business metrics?

They are quantifiable indicators of how your business is performing.

They are often based on financial performance, but not all key metrics have to be.

Basic financial metrics include gross revenue, gross profit, and net profit.

More advanced financial performance metrics include ratios like your current ratio and quick ratio, A/R aging, and A/P aging.

Gross Revenue

Total income before any expenses are deducted.  Also referred to as the top line, based on its position on the income statement. Used to measure your business’s growth.

Net Profit

Income after deducting all expenses. Also referred to as the bottom line, a reference to its position on an income statement. Used to measure efficiency.

Current Ratio

Current assets/Current liabilities.
Measures your business’s ability to meet obligations due within one year.

Quick Ratio

(Current Assets – Inventory)/Current Liabilities.

A conservative alternative to the current ratio for measuring ability to meet current liabilities.

A/R Aging

Report summarizing how long receivables are outstanding. Measures collection efficiency and customers’ financial health.

A/P Aging

Summarizes how long your business’s payables have been outstanding. Measures how efficiently you’re managing your cash and what amounts are due to your vendors.

Financial metrics are directly based on your financial results.

Metrics that aren’t directly based on standard financial performance include customer conversion rate, retention rate, and churn rate.

Customer Conversion Rate

A measurement of the percentage of your customers who take a desired action.

Retention Rate

A measurement of the number of customers your business retains. Popular among businesses with recurring revenue.

Churn Rate

A measurement of the number of customers your business loses. Popular among businesses with recurring revenue.

Non-financial metrics are based on factors other than your financial results.

What should you include in this section of your business plan?

A description of key metrics that your business will use and a brief description of your goals related to those metrics.  

You do not need to go into great detail about the financial performance goals you have set for your business, as this will be addressed in detail in the financial plan section.

LivePlan has some basic metrics available within their toolset, which can be incorporated into developing your plan.

If you are using BizMiner, which I’ve discussed in previous posts, there are reports where you can determine some of the typical metrics and averages for other businesses in your area.

Next Steps

Knowing whether you are staying on track is a critical skill in effectively LivePlanning.

Milestones and metrics will help you do this.

If you need help setting up your milestones and choosing your metrics, consider signing up for the next LivePlan Online Workshop here.

Then, move on to the Ownership and Legal Structure section.

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