Sales are essential for any business as they are the means to sustain the company, to continue the activity, to stand out from the competition, to achieve profits that make the activity being carried out profitable and to promote the growth and development of the company.
It is therefore important to carry out an exhaustive analysis of sales productivity and, to achieve this, it is essential to use the appropriate KPIS to help measure it.
Here, from Cerdá, we explain which are the main KPIS that you should use to measure the results and productivity of your company. They will help you to have detailed information that you can use to constantly improve and grow your business.
What are KPIs?
Before starting to explain what the main sales KPI's are, it is essential to understand what a KPI is and that, in addition, only those that are necessary and best suited to each company should be chosen in order to understand the results so that they make sense, are valid and help to achieve the goals.
KPI stands for Key Performance Indicator, that is, an indicator or metric that is used to analyse in detail the performance of a project or a specific section of the company.
In this case, the sales productivity KPIs, as their name suggests, will help you understand what the positive or negative points of this particular aspect are and whether or not it is feasible to achieve the objectives set.
Thanks to these indicators or metrics you will be able to analyse and create new strategies, modify the ones you already have or eliminate them. All oriented to optimise the performance of each action or strategy and that will help you to plan correctly and with the help of data intelligence all your efforts, actions, investment capacity and resources available to your company. Don't you know where to start? From Cerdá we talk about retail sales KPI's and basic metrics to analyse if you have an e-commerce.
What are the key characteristics of sales indicators?
Sales KPIS are the great allies of any business and among their main characteristics we find that they must be:
In other words, with each of the KPIs we use to analyse our business we can focus on a specific issue, compare their results with past results, measure exactly how things are going in real time, focus on the relevant and important aspects and, above all, understand what the results we are getting mean.
What are the main sales KPI's you need to consider?
The sales indicators to measure should be chosen according to your company's needs and what you want to analyse more precisely. It is advisable to have a small number (it would be useless to look at all the possible metrics of a business) but they must be very effective. From Cerdá Group we recommend you to start with the following ones:
La captación de nuevos clientes es esencial para poder medir la productividad de las ventas. Con este KPI se puede medir el ratio de clientes nuevos con respecto al resto de la cartera de clientes y, además, calcularlo en un plazo de tiempo determinado.
Con el análisis de este KPI se puede valorar de forma más concreta si es necesario llevar a cabo estrategias de marketing específicas para aumentar la cifra de clientes nuevos, mejorar los ratios de clientes que compran de forma recurrente, conocer el grado de satisfacción de compra de los clientes actuales para potenciar estrategias de fidelización, o cualquier otra acción que ayude a aumentar el número de clientes y, por tanto, de ventas.
The acquisition of new customers is essential in order to measure sales productivity. With this KPI you can measure the ratio of new customers to the rest of your customer base and calculate it over a certain period of time.
With the analysis of this KPI, it is possible to assess more specifically whether it is necessary to carry out specific marketing strategies to increase the number of new customers, improve the ratios of customers who buy on a recurring basis, know the degree of purchase satisfaction of current customers to enhance loyalty strategies, or any other action that helps to increase the number of customers and, therefore, sales.
Number of leads
For e-commerce, leads are fundamental, as they show the number of potential customers who are interested in our products or services. Therefore, using this sales KPI is very beneficial if, for example, we are developing specific actions to position an online shop.
Another ratio that applies to both online and physical shops. Once the number of leads is known, it is time to use one of the most important and fundamental metrics to calculate sales productivity: the conversion rate.
The conversion rate in digital is achieved by dividing the number of orders by the number of leads and multiplying the total by 100. In retail, the conversion rate is calculated by the number of people who have entered the shop and bought a product. In other words, if a shop receives 1,000 visitors in a day and 10 of them buy something, you would have a conversion rate of 1%. Useful for considering new offers, product placement or changes in the shop window, right?
The average ticket allows you to know what is the average expenditure of a customer in the total sales calculation. With this information, strategies can be created to increase it and achieve more sales and profits.
This sales indicator allows us to know exactly how much revenue the company receives on a regular basis. To calculate it, you have to multiply the average revenue per customer by the number of total customers you have. And it can be calculated on a monthly, quarterly, half-yearly basis... depending on the data you want to know.
The jewel in the crown. This is the essential KPI to know if our business is working or needs to improve... First of all, quantity of sales is not the same as quantity of turnover. What does this mean? That the productivity of sales is linked to the increase in turnover because if, for example, we sell 100 products with a total turnover of 100 euros, it is not as productive as if we sell 100 products with a total turnover of 1,000 euros.
Every company should create a turnover target based on its costs and revenues, and in order to achieve it, it is necessary to create strategies and know exactly the current turnover metrics.
A formula that can be applied by any e-commerce that wants to know its turnover KPI is the following:
Monthly turnover - previous month's turnover / previous month's turnover.
The result has to be multiplied by 100 and, in this way, the monthly turnover KPI is obtained.
Throughout this article we have explained why you should be concerned if you are going to measure the sales productivity of your shop, what the KPIs are for and which ones you should take into account if you are thinking about improving your business results. In addition, you have to choose those indicators that are really useful at each stage of the sales process you want to analyse in order to focus only on those that provide the data you want to know.
Knowing the sales productivity of your company is very important to be able to grow and carry out differentiating, practical and useful strategies to achieve all the proposed goals. In addition, thanks to the possibilities offered by using the different KPIs, we can know the results on a monthly, bimonthly, quarterly, annual... or by selecting the period of time you are interested in analysing at any given time depending on the needs that arise. At Cerdá, thanks to our knowledge of the retail sector and our experience, we can help you improve the results of your business through sales. Can we help you?
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