Understanding how effective the sales department as a whole and each salesperson in particular is necessary for planning the development of the company. Any firm that does not pay attention to this, doomed, and they will not be saved even just purchased CRM. To understand the effectiveness of the department, you need to manually and impartially assess the quantitative and qualitative performance of the sales department and salespeople:

• achieved sales revenue
• profit generation
• sales volume per potential customer
• sales volume per actual customer
• number of orders per period
• sales to new customers
• number of new customers

Note that all of these metrics are related to products sold. There are other quantitative performance measures that include:

• number of contacts with consumers
• number of contacts per potential customer
• number of contacts per actual customer

In turn, this information makes it possible to determine:

• the relationship between sales revenue and the total number of customer contacts
• the ratio between profit and the total number of customer contacts
• the ratio between the number of orders received and the total number of customer contacts (effective communication).

These ratios help answer the following questions:

• Did the salesperson succeed in achieving the planned sales volume?
• Does the achievement of the sales target affect profits?
• Did the salesperson or sales representative not achieve the sales target by giving customers unreasonably high discounts?
• Does the salesperson devote sufficient time to working with potential customers?

• To what extent is outreach to potential customers justified by the number of orders received from them?
• Does the sales representative communicate sufficiently with potential customers over a period of time?
• Does the sales rep have enough repeat customer contact across categories?
• Does the sales rep pay too much attention to low-potential customers?
• How is the number of negotiations conducted reflected in sales performance?
• Is the salesperson meeting the sales volume target through a large number of small orders or a small number of large orders?
• Is the profit per order sufficient to justify the amount of work per customer?

Many of the indicators listed above point to possible reasons why a salesperson may not be achieving his or her sales volume target.

Perhaps the salesperson is lazy and therefore the required number of contacts with potential customers is not taking place. Perhaps the rate of contacts made is quite satisfactory, but their effectiveness (the ratio between sales volume and total number of contacts) is quite low. This may indicate a lack of training. Maybe the salesperson communicates too much with regular customers and does not devote enough time to potential customers.

My experience is that after our first visit, the management of the company changes in face as they realise how much time and profit they have actually lost. Let’s analyse the performance of your sales team together, identify the quality of your salespeople and find where we focus our attention.

We can guarantee that if you apply our recommendations, you can increase your sales by tens of per cent.