|With today’s downsized staff, you need to get the most out of your sales staff.
If goals are being met and revenue is where you want it to be, you may not need to use any measuring devices. But if there is a problem, the following ratios, if applicable to your particular business, may help you pinpoint the problem, analyze it, and take action.
The ratios can be applied to your entire business, to a division or department, or to one employee. Progress can be measured by comparing numbers from one month to the next.
Ratio 1: Total sales compensation/gross sales = direct selling costs (%).
Ratio 2: Gross sales/total hours worked by salespeople = sales dollars per hour.
Ratio 3: Number of sales/number of full-time-equivalent salespeople = number of sales per salesperson.
Ratio 4: Gross sales/number of full-time-equivalent salespeople = sales dollars per salesperson.
Ratio 5: Gross sales/number of sales transactions = average sales dollars per transaction.