The 5 Metrics Every Vendor Should Track
Most vendors track revenue. Almost nobody tracks the metrics that actually matter. You can do ₦1M/month and be going broke, or do ₦400K and be building wealth. The difference is knowing 5 numbers. This guide shows you what to track and why.
Metric 1: Repeat Customer Rate
Formula: (Customers who bought more than once) ÷ (Total customers) × 100
What it means: Are people coming back to you, or is every sale a new customer?
Why it matters: Repeat customers are 5x more profitable. You don't have to spend money convincing them. They trust you.
| Repeat Rate | What It Means |
|---|---|
| Below 20% | Problem. Your product or service isn't satisfying people. |
| 20-40% | Normal for transaction-based businesses (electronics). You're okay. |
| Above 40% | Excellent. People trust you. You have a real business. |
Real example: Fashion vendor doing ₦800K/month. 60% repeat rate. That means 12 customers bought twice or more. Those 12 account for ~40% of revenue (₦320K). If repeat rate drops to 30%, revenue drops to ₦600K. Track this number monthly. If it drops, something's wrong.
Metric 2: Average Order Value (AOV)
Formula: Total revenue ÷ Number of transactions
Example: You did ₦1M in revenue with 100 sales. AOV = ₦1M ÷ 100 = ₦10K per order.
Why it matters: AOV shows if you're moving up-market or down. If it drops, it means customers are buying smaller items. This is good if you're intentionally reaching more people. Bad if it means you've lost premium customers.
Healthy targets:
- Fashion: ₦8K-15K
- Electronics: ₦80K-200K
- Food: ₦3K-8K
Metric 3: Customer Acquisition Cost (CAC)
Formula: Money spent on marketing ÷ New customers acquired
Example: You spent ₦50K on Google Ads and got 10 new customers. CAC = ₦50K ÷ 10 = ₦5K per customer.
Why it matters: If your CAC is ₦5K and your AOV is ₦8K, you're barely making money on new customers. You need repeat purchases to be profitable.
Healthy CAC:
- Should be no more than 30% of AOV
- If AOV is ₦10K, CAC should be ₦3K or less
Metric 4: Completion Rate
Formula: (Paid orders) ÷ (Quoted orders) × 100
Example: You sent 50 quotes. 35 became sales. Completion rate = 70%.
Why it matters: This shows how good your quotes and communication are. A 50% completion rate means half your prospects are saying no. A 80% rate means your pricing and presentation are solid.
| Completion Rate | What It Means |
|---|---|
| Below 40% | Problem. Your pricing is too high, or you're not following up. |
| 40-60% | Normal range for WhatsApp sales. |
| Above 70% | Excellent. Your process is optimized. |
Metric 5: Profit Margin
Formula: (Revenue - Total Costs) ÷ Revenue × 100
Example: ₦1M revenue. Costs: ₦700K (inventory), ₦150K (rent/transport). Total costs = ₦850K. Profit = ₦1M - ₦850K = ₦150K. Margin = ₦150K ÷ ₦1M = 15%.
Healthy margins by business type:
- Electronics: 20-30%
- Fashion: 35-50%
- Food: 45-65%
- Services: 50-70%
If you're below these ranges, you're underpricing or overspending.
The Dashboard You Should Keep
Track these monthly. Seriously. Spend 30 minutes at the end of each month updating a spreadsheet.
| Metric | January | February | March | Target |
|---|---|---|---|---|
| Revenue | ₦800K | ₦900K | ₦1.1M | Growing 10%/month |
| Repeat Rate | 35% | 38% | 42% | Above 40% |
| AOV | ₦12K | ₦13K | ₦14K | Growing |
| Completion Rate | 55% | 58% | 62% | Above 70% |
| Margin | 28% | 30% | 32% | Above 35% |
Bottom Line
Revenue is vanity. Profit is sanity. These 5 metrics are your scoreboard. Track them. If they're going up, you're winning. If they're going down, something's broken and you need to fix it before it becomes a crisis.