Measuring Sales Performance
Consider your business. Do you have these numbers?
Tip 5 of 7 – Gross profits on dollars sold including the cost of the lead.
When you look at your profit margins on dollars sold, part of the expense is naturally the cost of getting the sale. Many business owners do not track that, yet it can make a powerful difference between loss or gain, and sometimes at larger margins than a person would ever guess.
In measuring sales performance it is an absolute must to track the profit margins of each of your sales reps for the profitability of every sale and every lead source. You will see patterns that allow you to change around your lead assignment, lead sources and advertising venues, and/or adjust your training.
It’s not always easy to calculate this, and in fact, this was one of the most time-consuming parts of our sales and marketing analysis. Therefore, we just started using an automated system. Now we wonder how we ever went without it.
Think of it! Your profits are directly affected by costs – the higher the cost, the lower the profit. Typically a business sets up a percentage margin and tries to stay within that for marketing. (Read this post about why you need to track your marketing ROI.) For every percentage point you go above what was allocated, costs eat directly from your profits. It’s simple math, yet so complicated.
It does not have to be complicated. Just automate your systems to give you the information necessary so that you can spend your time doing what you do best.
Winners Know Their Numbers!
Are you ready to start measuring sales performance? Call 1-800-972-6952 or CONTACT US HERE.
Measuring Sales Performance Tip 1: Individual Salesperson Closing Ratio and Volume Per Advertising Source
Measuring Sales Performance Tip 2: Closing Ratio Overall in Comparison to Industry Averages, Company Standards, Goals.
Measuring Sales Performance Tip 3: Cost of Leads Sold per Individual Salesperson
Measuring Sales Performance Tip 4: Contract Size in Comparison with Company Averages.
Measuring Sales Performance Tip 5: Gross Profits on Dollars Sold Including the Cost of the Lead.
Measuring Sales Performance Tip 6: Numbers and Volume of Sales for Self-Generated, Previous Customers, or Referral Business (Unpaid Advertising).
Measuring Sales Performance Tip 7: Individual Salesperson Strengths/Weaknesses in Company Product Line