Your Sales Strategy

6. Measuring Performance

6.1 Conduct an annual or quarterly profitability analysis.

• Examine and justify the time and money spent on different customers. Focus on profitability rather than volume of sales, and the quality rather than the quantity of contact.
• Find out if turnover was lower or higher than forecasted and, if so, why.
• Analyse which sales people, and channels, are most productive, and why.
• Monitor the returns on sales costs. Distinguish between sales representative and sales support costs.
• Compare this year's sales with the previous year's, and with those of similar companies in your market (see Benchmarking).

6.2 Analyse conversion rates monthly, using sales people's weekly activity reports.

• Work out how many sales have been made, and calculate their average value.
• Analyse the relationship between leads, visits, proposals and orders achieved.
• Monitor activity with both new and existing customers.
• Examine each stage in the selling process to find out where you are losing the sales.

6.3 Identify problems, and find out what has caused them.

For example, you might have reductions in sales to key customers, caused by an unreliable delivery service.

• Identify dead accounts and follow them up. Making a sale to an existing customer is far easier than winning a new one. Find out why these customers are not ordering.
• Find out what percentage of your customer base no longer buys from you, and why.