How to Track Business Growth Month Over Month

"Are we growing?"

It's the simplest question in business—and one of the hardest to answer correctly.

Most business owners either don't track growth at all, or track it wrong. They look at revenue once a month, feel good (or bad), and move on without understanding why.

Here's how to track growth properly.

Why Month-Over-Month (MoM) Matters

The Problem with Annual Comparisons

Comparing this year to last year is useful, but:

It's slow feedback (you wait 12 months)
A lot changes in a year
Hard to connect actions to results

The Problem with Daily/Weekly Data

Too granular means:

Noise overwhelms signal
Natural variation causes panic
You react to randomness

The MoM Sweet Spot

Monthly tracking gives you:

Fast enough feedback to course-correct
Stable enough data to spot real trends
Long enough periods to see patterns

The MoM Growth Formula

Basic Formula:

MoM Growth = (This Month - Last Month) / Last Month × 100

Example:

December revenue: $52,000
November revenue: $48,000
MoM Growth: ($52,000 - $48,000) / $48,000 × 100 = 8.3%

Simple, right? But there's more to it.

What to Track MoM

Primary Metrics

1. Revenue

Total revenue
Revenue by product/service
Revenue by channel

2. Customers

New customers acquired
Total active customers
Customer churn

3. Transactions

Order count
Average order value
Units sold

Secondary Metrics

4. Efficiency

Revenue per customer
Cost per acquisition
Profit margin

5. Engagement

Website traffic
Email open rates
Conversion rate

How to Read MoM Numbers

Healthy Growth Patterns

Consistent growth:

Jan: +5%
Feb: +4%
Mar: +6%
Apr: +5%

Interpretation: Steady, sustainable growth. Keep doing what you're doing.

Accelerating growth:

Jan: +3%
Feb: +5%
Mar: +8%
Apr: +12%

Interpretation: Something's working. Figure out what and double down.

Warning Signs

Decelerating growth:

Jan: +15%
Feb: +10%
Mar: +5%
Apr: +2%

Interpretation: Growth is slowing. Investigate before it becomes negative.

Volatile swings:

Jan: +20%
Feb: -10%
Mar: +25%
Apr: -15%

Interpretation: Unstable business. Could be seasonality, one-time events, or inconsistent operations.

Accounting for Seasonality

The Trap

Raw MoM comparisons can be misleading:

December vs November: +40% (holiday spike)
January vs December: -35% (holiday hangover)

Neither tells you if you're actually growing.

The Solution

Compare to same month last year:

December 2024: $52,000
December 2023: $41,000
YoY Growth: +26.8%

Or use trailing 3-month averages:

Oct-Dec 2024 average: $48,000
Jul-Sep 2024 average: $42,000
Quarterly growth: +14.3%

Building a Growth Tracking System

Step 1: Choose Your Core Metrics

Pick 3-5 metrics that matter most:

For ecommerce:

Revenue
Orders
Average order value
New customers

For SaaS:

MRR (Monthly Recurring Revenue)
New signups
Churn rate
Active users

For services:

Revenue
New clients
Project count
Utilization rate

Step 2: Set Up Monthly Tracking

Option A: Spreadsheet

Create columns for:

Month
Metric value
Previous month value
MoM change (%)
Same month last year
YoY change (%)

Option B: Automated Tool

Upload your data monthly and get:

Auto-calculated growth rates
Trend charts
Comparisons
Anomaly detection

Step 3: Establish Review Cadence

First week of each month:

Export last month's data
Calculate MoM changes
Note any anomalies
Identify top 3 insights
Decide on actions

Takes: 30 minutes with automation, 2-3 hours manually

Real Example: Monthly Growth Review

The Data

Revenue (last 6 months):

July: $38,000
August: $41,000 (+7.9%)
September: $39,500 (-3.7%)
October: $44,000 (+11.4%)
November: $48,000 (+9.1%)
December: $52,000 (+8.3%)

The Analysis

What the numbers show:

Overall trend: Strong growth
September dip: Investigate
Q4 momentum: Excellent

Possible September explanation:

Summer slowdown ending?
Marketing campaign ended?
Product issue?

Key insight: Despite September blip, 6-month growth is 36.8% ($38K → $52K). Annual run rate increasing.

The Actions

Investigate September - What caused the dip? Prevent recurrence.
Analyze Q4 drivers - What's working? Do more of it.
Plan for January - Historically slow. Prepare campaigns.

Common Growth Tracking Mistakes

Mistake 1: Cherry-Picking Periods

"We grew 50%!" (comparing best month to worst month)

Fix: Always use consistent comparison periods.

Mistake 2: Ignoring Context

"Revenue dropped 10%!" (but you also cut ad spend 50%)

Fix: Track multiple metrics together. Understand relationships.

Mistake 3: Reacting to Single Months

"We're down 5% - panic!"

Fix: Look at 3-month trends before making big changes.

Mistake 4: Forgetting Absolutes

"We grew 100%!" (from $500 to $1,000)

Fix: Track both percentage AND absolute growth.

Growth Benchmarks

What's "Good" Growth?

Early stage (< $1M revenue):

10-20% MoM is strong
5-10% MoM is healthy
< 5% MoM needs attention

Growth stage ($1M-$10M):

5-10% MoM is strong
3-5% MoM is healthy
< 3% MoM is slowing

Mature stage ($10M+):

3-5% MoM is strong
1-3% MoM is normal
Flat requires investigation

Industry Variations

Different industries have different norms:

SaaS: Higher growth expected
Retail: Seasonal patterns normal
Services: Often steadier

Tools for Growth Tracking

Manual (Free)

Excel/Google Sheets
Manual data entry
Formula-based calculations

Time: 2-3 hours/month Pros: Free, customizable Cons: Time-consuming, error-prone

Automated

Upload monthly data
Auto-calculated metrics
Visual trend charts
Growth comparisons

Time: 5-10 minutes/month Pros: Fast, accurate, visual Cons: Monthly cost

Your Growth Tracking Checklist

Weekly (5 minutes)

[ ] Check revenue vs. last week
[ ] Note any major changes
[ ] Flag issues for monthly review

Monthly (30 minutes)

[ ] Calculate MoM growth for core metrics
[ ] Compare to same month last year
[ ] Identify top 3 trends
[ ] Document insights
[ ] Set actions for next month

Quarterly (2 hours)

[ ] Review 3-month trends
[ ] Analyze seasonal patterns
[ ] Assess goal progress
[ ] Adjust strategy if needed
[ ] Update forecasts

Key Takeaways

MoM is the sweet spot - Fast enough to act, stable enough to trust
Track trends, not snapshots - One month means nothing alone
Account for seasonality - Compare apples to apples
Automate the math - Spend time on insights, not calculations
Always ask why - Numbers without understanding don't help

Want to track your business growth automatically? Try InstantInsight free—upload your data and get MoM growth, trends, and comparisons calculated instantly.