Sales targets can only be measured with appropriate key figures. With clearly defined key sales figures, you can track your sales success and keep an eye on all developments. They also form the basis of important business decisions. Which key figures are useful for this?
What are sales indicators?
Sales metrics, also known as key performance indicators (KPIs), allow you to evaluate the performance of your sales team and your business. They form the basis for targeted control. Examples of sales KPIs include revenue, closing rates, and customer satisfaction. The collected data is evaluated in sales control.
Why are sales metrics important?
KPIs are used to review and evaluate the performance of the entire sales force. Using key sales figures, you record the current state and show what is still needed to reach the desired target state. With key sales figures, you can find out which processes in your company still need action and increase your company’s profitability.
Which KPIs are relevant?
In sales, it is the result that counts, that is to say the turnover. Also, there are many other key numbers that you should not ignore. This is the only way to assert yourself in an increasingly competitive market and to stand out from the competition. The more meaningful data you collect on your CRM solution, for example, the better the software can help you monitor metrics, improve processes, and make profitable decisions.
The relevant sales figures differ from company to company. Depending on company size and business model, a few or more KPIs may make sense.
What sales figures are worth?
Defining the right sales metrics is not only crucial for sales success, but also for the success of the whole company. When selecting KPIs, it is important to distinguish between two areas: quantitative and the qualitative metric. While the former are clearly identifiable, qualitative KPIs focus on factors that are not so easy to measure.
An example: A sales representative makes many phone calls every day and regularly presents his products to interested parties on site. Quantitatively, his figures are correct. Despite this, he only reserves a few purchases. His colleague is much less often away from home and has fewer interested parties. The sales rate is nearly 80%. Why is that? The colleague continues the tactic of establishing good contacts with the managerial level of the person concerned. This factor cannot be measured quantitatively, only qualitatively.
It follows: It depends on the combination of KPIs. Therefore, combine quantitative and qualitative KPIs to measure sales effectiveness.
Although there are many KPIs to choose from, it is best to focus on just a few.
What are the main sales indicators?
There are a variety of KPIs you can consider for your sales. Here is an excerpt from the most important sales figures:
- Turnover achieved: The measurement can be monthly, quarterly, half-yearly or annually.
- Acquisition of new customers: Number of new customers that the sales department was able to acquire over a certain period of time.
- Average sales cycle: Average number of days it takes for a prospect to become a paying customer.
- Opportunity conversion rate or success rate: The number of deals compared to the number of won and lost opportunities.
- Order range: Indicates the workload with orders for the next few months.
- Break even : The point at which all costs are covered and the transition to profitability. After that, extra income is pure profit.
- Return on investment (ROI): Shows the amount of investment relative to income.
- Customer Loyalty or Retention Rate: Customers who continue to trust you after the initial order and who have purchased your products or services several times.
- turnover rate : Percentage of lost customers, an important factor in measuring customer satisfaction.
- number of activities: Number of times the sales team interacted with a customer.
- number of sales made, pending and lost
- Cancellation rate: Shows how many of your orders are subsequently cancelled.
- Qualification of the prospect: Quantity and quality of data available on a prospect.
- Competitive comparison: Any information that may be collected about the competition.
- Points of sale: Preparation of the appearance and content of the sales representative.
- Customer history: Needs and wishes of the customer to find the right interlocutor.
- Quality of care: Seller’s behavior towards customers.
- Client satisfaction: The customer’s attitude towards the company and the product sold can be measured, for example, using ratings or customer surveys.
What should be taken into account when using key figures?
Whether your employees work in marketing, service or sales, one thing is particularly important: the acceptance and understanding of objectives and KPIs. Working with key people is only possible if the management or department head communicates it clearly and actively leads by example. Without KPIs, it is difficult to set and track goals. A well-maintained CRM system will help you capture relevant data and perform analysis. Your employees can then use this data to optimize their processes.
Sales KPIs in CRM
Calculating sales metrics manually can be time consuming. A CRM system is therefore recommended to record sales KPIs. With the right evaluations in CRM, you can, for example, draw conclusions about the use of work resources and decide whether they are used correctly. Customers can be prioritized based on various parameters and time quotas adjusted accordingly – because nothing slows a salesperson down more than spending too much time on unprofitable customers. It is therefore appropriate to focus on transparency for the entire sales team and to highlight the advantages of KPI evaluations. This is the only way for your sales department to record and analyze customer acquisition and follow-up and the corresponding sales successes.
In a modern CRM solution, for example, you can display forecasts for a selected period in addition to current sales.
Additionally, all relevant activities with customers can be seamlessly mapped and traced. With customizable dashboards, you can display all the KPIs relevant to you on one overview page. This way you can keep an eye on all important key figures on a daily basis.
Conclusion: with key sales figures for business success
By focusing your sales on certain key figures, you work more efficiently and can discover potential for improvement. It’s important to use the right key numbers for your business that are meaningful for your size and industry. To do this, use a few key figures that you regularly evaluate and derive optimization potential from them that will ensure the long-term success of your business.