On Tuesday, I sent out a sales tip (aka “Tuesday’s Tips”) to my subscribers which was to ALWAYS measure your sales numbers. Not just your revenue and the top line, but also the numbers that contribute to those numbers (you can view the tip here).
In this article, I’ll share with you the 5 sales numbers you MUST measure. This will help you identify which areas need improvement and how quickly you need to fix any problems.
Sales number 1 – Amount of hours spent on BD
Consider how much time you spend and your staff spend on business development activities. This could include:
- Coffees, lunch and other forms of relationship building
- Preparing for and conducting presentations
- Networking
- Research
- Preparing tenders
Each hour presents an opportunity cost you need to be aware of. So lets track this.
Sales number 2 – Number of new conversations opened
Now lets look at how effective your BD efforts have been. How many conversations with new clients have you opened? How many new conversations with existing clients have you opened? I’m not talking about coffees to “catch up” here. I’m talking about real conversations where the client is curious about how you can help them (further).
Sales number 3 – Time spent engaging in new conversations with potential clients
Now we’ve reached the “sales” phase, how much time does it take to get past it? That is, until a potential client becomes an actual client? Once again, where are you spending your time and what are you giving up?
Sales number 4 – Average dollar per sale
People talk about conversion rates all the time. For example, I convert 80% of the time I have a conversation. But if we averaged the dollar value of work won over all the your clients, does it bring you crashing back to reality?
Sales number 5 – Client acquisition cost
On average, how much do you need to spend in order to get a client to say “yes”? Think about:
- Marketing and advertising costs
- Cost of staff time
- Anything else you do to win the work.
Are you spending too much when you compare it to your average dollar per sale? How can you become more effective.
Do you have any other numbers you measure? I’d love to hear from you! Follow me on twitter @jenny_tse or post a comment below.
Keep watching this space for weekly sales tips!
I am a speaker, published author, sales strategist and coach to small businesses. Over the past decade, I've worked with some of the largest organisations in the world, including PricewaterhouseCoopers, Macquarie Bank and have been invited to speak at the National Audit Conference hosted by the Institute of Chartered Accountants. I'm brought in by clients increase their revenue. I run a 3 day sales and communication workshop where I teach my 12 step sales process. www.licencetobill.com.au
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Phil Joel, Chief Revenue Officer at Alex Solutions
Hi Jenny, really good article. Thank you. What we used to measure were opportunities at various stages of the funnel - Suspects, Prospects, Qualified, Proposal, Negotiation, Contracts and of course Win / Loss Ratio.
Wendy Huang, Full Time Blogger and YouTuber at A Custom Blog in 4 Minutes
Wow can't wait for more weekly updates. I love how you pulled together the summary at the bottom, really puts all the measurabless in an easy to understand format.