Read your P&L like a founder: 7 numbers every Indian SMB owner should track

Most P&L statements in Indian SMBs are built for the CA and the tax department, not for the owner. That's fine for filing. But the same numbers, rearranged on one page, tell you where the business actually makes money — and where it quietly bleeds.

1. Gross margin by product line. Not overall GM — by line. One distributor we know discovered 40% of his SKUs sat below 8% margin while consuming most of his working capital. Two were dropped, one repriced, and profit rose with lower revenue.

2. Contribution per order or per client. After discounts, payment gateway fees, freight and commissions, what's left? E-commerce sellers are routinely shocked that their best-selling product contributes the least.

3. CAC and payback. If you spend ₹40,000 on marketing and gain 30 new customers, your CAC is ₹1,333. If each customer's average margin is ₹400 a month, you recover CAC in about 3.3 months. Payback under 6 months is healthy for most SMB channels.

4. Receivable days. The gap between delivery and cash-in-hand. Many 'profitable' businesses are one late-paying anchor client away from a crisis. Track it by customer, not in aggregate.

5. Inventory turns. Stock lying for 120 days is cash wearing a costume. Slow movers need a clearance decision, not a warehouse.

6. Fixed-cost coverage. How many months can your current cash cover rent, salaries and EMIs if sales stop tomorrow? This single number decides how aggressive you can afford to be with growth spends.

7. Promoter salary sanity. Owners who pay themselves nothing make every margin look better than it is. Pay yourself a market salary on paper, even if you route it back — your unit economics will thank you.

A simple monthly MIS in Google Sheets covers all seven. When the business crosses roughly ₹5 crore turnover or multiple entities, that's the point where a virtual CFO earns their fee — not before, and not never.