QuickBooks Online Revenue Report
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Revenue + Growth Insights for QuickBooks Online
Business of all types need to carefully track revenue and growth. Knowing these metrics can be the difference between your business struggling and being a breakout success.
In this post, we are going to learn how to get revenue and growth insights from your current QuickBooks Online data. We will also introduce Alluxo, a powerful software platform, that can visualize your revenue, revenue growth, and other key metrics for free.
Let’s start by defining the different types of revenue then build to more advanced concepts.
Different Types of Revenue
Revenue is defined as the income generated by a business during its normal course of operation. Typically, revenue is generated from selling products or providing services to customers.
That said, even small businesses may have multiple types of revenue so it’s important to go deeper than looking at revenue as a single item.
For example, an ecommerce startup should track revenue by product. If they have distinct product lines (e.g., hats and sunglasses), they should also report revenue by category. All of this data should be brought together to create total revenue.
That same brand will also want to understand its data for different time periods. We recommend looking at revenues segmented by day, week, month, quarter, and year.
Meanwhile, a consulting firm will exchange its service for money. They have no physical goods to sold so, naturally, their revenue categories will be different.
Consulting firms would find value in understanding their revenue by customer, revenue by project, and, in some cases, revenue by employee. The last option is particularly important if there is a large difference between the highest and lowest hourly rate in your company.
Everything we have been discussing has been revenue through normal business operations. There is also something called other revenue, which refers to income generated outside of your normal operations. Earning interest on an outstanding bill would be other income.
Revenue Growth Rates That You Need Know
Let’s take things one step further. Below we have the revenues of a fictitious business called Awesome Clothing. This data will be used to help us understand growth rates.
Awesome Clothing Revenues
A growth rate is the percent change in a value over a period of time. For example, the growth rate of Hat Revenue in February was 20%. This 20% was calculated by:
(Current Value – Previous Value) / Previous Value
To calculate February’s growth, we set the $5000 of Hat Revenue in January as our Previous Value. We then took Hat Revenue in February, which was $6000, and plugged that in as the Current Value because we are calculating a growth rate for the month of February.
Note: Keep in mind that financials are calculated at the end of the month. So if we want to know the growth in February, we need to compare what happened at the end of January to the end of February as shown above.
Now let’s switch gears. The growth in total revenue above is 83%, which seems great. But what does that mean? In isolation, 83% does not tell you much. That’s why we suggest looking at growth rates over time.
As you can see by the monthly view, we see periods of high growth and significant decline in March. This is a great way to understand what was working in particular months, and bring together marketing data to identify trends.
Furthermore, we can break out multiple revenue growth rates. In the Awesome Clothing example, we can visualize growth for hats, sunglasses, and total revenue. Let’s take a look at that below.
After looking at three revenue growth rates, we can see that hats have been increasing at a consistent rate while sunglasses has a lot of variability. Moreover, we see that the total growth from January to April is positive, but there is a sharp decline in March!
The example above helps to illustrate why we need to look at growth rates in a context. Most commonly, we recommend looking at growth month over month, quarter over quarter, and year over year.
Get Revenue and Growth Insights with Alluxo
Now you’re a pro on revenue classifications, revenue growth, and more. But it can still be time-consuming to perform these calculations – and that’s where Alluxo enters the picture.
Alluxo is a software platform that helps you visualize data and get insights automatically. Our service connects to QuickBooks Online and can create up-to-date revenue charts, growth rates, and more – all for free.
The interactive charts above are examples of what you build in seconds with Alluxo. More than that, we let you combine multiple revenue charts together to create powerful revenue reports. Dashboards are a great way to pull up information in meetings or share data by sending the link via email or direct message (like Slack!).
And, if that’s not enough, we have free mobile apps for iPhone, iPad, and Android that allow you to keep your revenue metrics at your fingertips.
Have questions about QuickBooks Online, revenue, or Alluxo? Reach out to the outstanding Alluxo customer success team today.