Business Glossary
What Is a Commercial Health Score?
A commercial health score is a composite metric rating a business’s overall commercial performance across multiple dimensions — margin, cashflow, pricing, working capital, and growth. It provides a single number summarising complex financial data into an actionable assessment.
The Formula
Commercial Health Score: Gross margin vs benchmark + Net margin vs benchmark + Cash runway + Debtor days + Revenue above break-even + Pricing position
Worked Example — UK SME
A UK distribution business: gross margin 21% (within benchmark), net margin 5.2% (within benchmark), cash runway 1.8 months (below minimum), debtor days 42 (above target), 22% above break-even. Score: 58/100 — developing.
UK Benchmark
📊 LumixAI scores 0–100 across 7 weighted dimensions. Above 80 = commercially strong. 65–80 = solid with improvement opportunities. 45–65 = developing with important gaps. Below 45 = significant pressure requiring immediate action.
Common Questions
How is a commercial health score different from a credit score?
A credit score measures creditworthiness. A commercial health score measures operational and financial performance. They are complementary but measure different things.
How often should I run a commercial health check?
Quarterly is ideal. The LumixAI Full AI Report generates a full score and analysis in under 10 minutes.
What is the fastest way to improve the score?
A pricing review improving gross margin by 3 percentage points typically adds 8–10 points. Reducing debtor days from 60 to 35 adds 5–8 points. Building a 2-month cash reserve adds approximately 6 points.
Calculate this for your own business
The LumixAI Full AI Report does this automatically.
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