RE: Sales Performance metrics

["Alan Clark" <alanclark5@btconnect.com>]

Martin,

As with many things it depends. In this case, which sales environment
are you interested in? Some categories might be external sales (business
to business or business to domestice), telesale or retail sales. In each
different metrics would be appropriate. In business to business metrics
will also vary between high value capital goods, chemicals, bulk
materials, commodities (both raw materials and manufactured, e.g.
screws) or service. The latter category contains huge variety.

In external sales, particularly business to business the classic "sales
funnel" or "pipeline" might be helpful in determining in-process
measures. There will be a series of ratios derived from the sales funnel
as follows: cold calling, qualification of sales leads, demonstrations,
development of solution, quotations/proposals, negotiation, order
placement, (sometimes sample acceptance), delivery and payment. There
are a number of variations on this theme depending on the industry. And
when is a sale a sale - only when you have collected the money?

One of the biggest and most familiar problems in sales is incentives.
Often the sale is the result of the actions of a whole
team/department/company - the system - supporting the sales person.
Great sub-optimisation results from incentives. Having managed sales
people I have seen first hand the unintended consequences of incentives.
And of course there is the example of Jim "Matress Mac" McIngvale at
Gallery Furniture that shows how things can improve when you stop
individual incentives, particularly commission-only pay.

Hope this helps

Alan

Alan Clark - The Process Coach
Key Business Improvement
Telephone: 01527 598014
Mobile: 07831 508543
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