KPIs every Swiss SME should track (and why they matter)

Money is constantly moving, yet it is not always clear what those movements actually mean for your business.

You may feel busy and productive, but still uncertain. Are you earning enough? Is your pricing right? Are you growing in a healthy way, or just getting busier? Many Swiss SME owners face the same situation: numbers are everywhere, but insight is missing.

This is the point where the right KPIs change the game. Carefully selected, they let you track your business in real time, instead of uncovering surprises weeks or months later.

What are KPIs in business and how they reveal what truly drives your performance

A KPI, or key performance indicator, is essentially a metric that shows how well a specific aspect of your business is doing.

As a business owner, you’re already surrounded by numbers every day—sales, costs, bank balances, and pending invoices. KPIs take those figures and turn them into insight, helping you focus on what actually drives your business forward instead of just monitoring activity.

A KPI goes beyond a simple statistic. It shows whether something in your business is improving, staying stable, or moving in the wrong direction. When a KPI changes, it points you to an area that deserves a closer look.

For example, rising revenue may look positive at first glance. A KPI can show whether that revenue is actually paid on time, whether it covers your costs, or whether it requires more effort and cash than it generates. Without KPIs, these details often remain hidden until problems appear.

Eight important business KPIs to track for SMEs

There are countless business KPIs available, but not all are relevant for your situation. Tracking too many numbers can easily become overwhelming. As a small or medium-sized business owner, it’s better to focus on a select few that give you a clear picture of your company’s health. Here are eight KPIs we recommend monitoring closely.

1. Cash runway: how long your business can operate

This KPI shows how long your business can operate using existing cash reserves if incoming payments slow down.

Formula: Available cash ÷ Average monthly cash outflows

If your business holds CHF 75,000 in cash and monthly expenses average CHF 25,000, your cash runway covers three months.

This KPI matters because liquidity problems rarely announce themselves early. A shrinking buffer signals rising risk, even if sales look healthy. It is generally advisable to keep liquidity reserves that cover at least two to three months of operating expenses.

Questions to consider:

• Is my buffer growing or shrinking over time?
• How exposed am I to late client payments?
• What level of buffer makes me comfortable as an owner?

Most SMEs benefit from reviewing this KPI once per month.

2. Gross profit margin: how profitable your core activity is

This KPI focuses on how much value your business creates through its main activity, before overhead costs enter the picture.

Formula: (Revenue − Cost of goods sold) ÷ Revenue × 100

If your revenue is CHF 80,000 and direct costs (materials, subcontractors, delivery costs) amount to CHF 48,000, your gross profit margin is 40%.

This result means that for every CHF 100 you earn, CHF 40 remains to cover overhead, taxes, and your profit. Higher percentages indicate better control over costs and more pricing power. A declining margin signals that costs are rising faster than revenue, or pricing may be too low.

Questions to consider:

• Which services or products generate the strongest margin?
• Are discounts eroding long-term value?
• Have supplier costs changed without price adjustments?

Monthly tracking gives you early signals without overloading you with data.

3. Operating profit margin: how much income your business actually keeps

Being busy does not always mean being rewarded. This KPI shows what portion of your revenue remains in the business after all operating expenses are covered.

Formula: Operating profit ÷ Total revenue × 100

If your company brings in CHF 150,000 and, after covering all costs, keeps CHF 18,000, your operating profit margin stands at 12%.

In practical terms, this means that for every CHF 100 you bring in, CHF 12 remains as profit that can be reinvested into the business or used for your own income. A low ratio may indicate that your business is busy but leaves little reward for effort and risk, while a higher ratio reflects efficiency and sustainability.

Questions to consider:

• Is this return acceptable given my responsibility?
• Has this ratio improved as the business matured?
• Are fixed costs silently reducing my earnings?

Quarterly reviews usually provide enough insight.

4. Days sales outstanding (DSO): how fast revenue turns into cash

This KPI tracks the average time it takes for your clients to pay invoices, giving you a clear picture of your cash flow efficiency.

Formula: (Accounts receivable ÷ Revenue) × Number of days in period

If your unpaid invoices total CHF 60,000, monthly revenue is CHF 120,000, and the period is 30 days, your DSO is 15 days.

In practice, this means your business typically collects cash from sales in about two weeks. Shorter DSO periods keep cash flowing smoothly, helping you cover expenses and plan investments with confidence. Longer collection times may indicate payment delays, inconsistent follow-ups, or the need to adjust client payment terms.

Monitoring DSO regularly allows you to identify cash flow bottlenecks early, giving you the opportunity to act before delayed payments impact your ability to pay suppliers, salaries, or other obligations.

Questions to consider:

• Are payment delays becoming more frequent?
• Are payment terms realistic for my clients?
• Do I follow up consistently?

Monthly tracking is strongly recommended.

5. Fixed cost ratio: how adaptable your expense structure is

This KPI examines how much of your cost base is fixed versus adjustable.

Formula: Fixed costs ÷ Total costs × 100

If fixed costs represent 65% of total expenses, most of your spending (rent, salaries, insurance) does not easily decrease in slow months.

A high fixed cost ratio means less flexibility and greater vulnerability to revenue drops. A lower percentage indicates you can adjust spending more easily when needed.

Questions to consider:

• Which costs are difficult to reduce quickly?
• Are new fixed costs justified by stable revenue?
• Can certain expenses be converted into variable ones?

Reviewing this KPI quarterly provides strategic insight.

6. Revenue growth rate: how your business is evolving

This KPI measures how your revenue shifts over time, helping you see whether your business is gaining traction, plateauing, or slowing down.

Formula: (Current period revenue − Previous period revenue) ÷ Previous period revenue × 100

If your revenue increases from CHF 100,000 to CHF 115,000, your growth rate is 15%. This means your business is generating 15% more income than in the previous period.

While any growth can feel encouraging, the real question is whether it strengthens profitability and cash flow. Rapid growth that strains resources or cuts margins may be riskier than steady, manageable expansion. Conversely, flat or declining revenue signals it’s time to review your sales strategy, client mix, or operational efficiency.

Questions to consider:

• Is this growth translating into higher cash reserves, or just higher activity?
• Are the new sales profitable, or are discounts and costs eroding value?
• Can my team and processes handle this pace without compromising quality?
• Are specific products, services, or clients driving the majority of growth?
• How does this growth compare to seasonal trends or industry benchmarks?

Monthly or quarterly reviews work well, depending on activity.

7. Break-even point: the minimum your business must generate

Every business has a financial baseline below which it starts consuming reserves. This KPI identifies that baseline.

Formula: Total fixed monthly costs ÷ Contribution margin (as decimal)

If fixed costs are CHF 45,000 and your contribution margin is 50%, the minimum revenue needed is CHF 90,000 per month. This means your business must earn at least CHF 90,000 to cover salaries, rent, and other obligations. Falling below this level may force you to use cash reserves or cut costs; while exceeding it creates room for profit or reinvestment.

Questions to consider:

• How far above this threshold do I usually operate?
• Which costs raise this threshold the most?
• Would a short downturn threaten stability?

Review this KPI whenever your cost structure changes.

8. Owner value efficiency (custom indicator): how your time translates into results

Unlike the previous KPIs, this is not a metric you’ll find in standard accounting reports. However, for owner-managed SMEs – where the founder’s time is often the scarcest resource – it may be one of the most important indicators to track.

This practical metric connects your personal effort with business outcomes.

Formula: Operating profit ÷ Owner working hours

If your business generates CHF 70,000 in profit and you work 2,800 hours, your value per hour is CHF 25.

This shows the effective financial return on your time. A low number may indicate too much effort for the profit generated, while a higher number shows efficiency and sustainable workload. Consider comparing this figure against what you could earn as an employee in a similar role – your opportunity cost.

Questions to consider:

• Am I spending time on high-impact activities?
• Could some tasks be delegated or automated?
• Is my workload financially justified?

Quarterly reflection often reveals clear patterns.

How to review your most important business KPIs without drowning in numbers

Tracking KPIs is valuable only if you can act on them. For many Swiss SME owners, the challenge isn’t collecting numbers – it’s reviewing them efficiently without spending hours on spreadsheets. Here are three practical ways to simplify KPI monitoring:

Keep your attention on the critical numbers
Identify the few KPIs that truly shape your business outcomes. Monitoring these key areas ensures you act where it counts, instead of being distracted by every minor statistic.

Set simple targets or thresholds

Numbers are easier to interpret when you know what is healthy and what requires action. For example, a cash runway of three months may be comfortable, while less than two months signals a warning. Define ranges or goals for each KPI and focus only on those falling outside your targets. This instantly highlights areas that need attention.

Review at the right frequency and visualize trends

Not all KPIs need daily checks. Monthly reviews work well for cash flow and revenue, while quarterly reviews are enough for profitability and efficiency metrics. Visualizing trends in simple charts or dashboards makes patterns easy to spot and decisions quicker to make.

Gain clarity and time with LedgerPeek

Monitoring KPIs is useful – until managing them starts to take over your day. Cleaning, organizing, and interpreting numbers can quickly consume much of your time. Instead of focusing on your vision, building client relationships, or improving service quality, you find yourself buried in reports.

That is often the right moment to involve specialists.

At LedgerPeek, we help Swiss SMEs turn financial data into meaningful guidance. We work with you to define the top KPIs for your business, considering your unique goals, operational structure, and growth ambitions, and deliver clear, structured reports at the frequency you need – so that you can make decisions based on current, reliable numbers.

This way, you stay focused on your core business activities while knowing your financial health is being managed reliably and proactively.

Learn more about the KPIs relevant specifically for your situation and get a tailored overview of your business performance. Book a consultation with a LedgerPeek specialist today.