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What are the main sales KPIs in a company?

Sales KPIs help us set good goals and implement effective strategies in the commercial area of a company. But what exactly are they? What are the main KPIs?

Today in our blog we show you what exactly these indicators are and some of the main KPIs that you can implement from today in any business plan.

What are sales KPIs?

KPI stands for Key Performance Indicator. Thus, when we talk about “sales KPIs”, we refer to a series of quantifiable metrics used to measure the effectiveness in the sales performance of a company.

KPIs are fundamental for strategic management, as they show us if the objectives set are being met. Thanks to them it is possible to make comparisons, correct deviations, analyze information and make decisions.

In short, sales are of vital importance for the survival of a company. Therefore, sales KPIs help us determine if we are on the way to success or if any changes need to be made to achieve strategic and operational objectives in this area of the organization. 

Main sales KPIs in a company

Because sales KPIs should be relevant metrics that provide valuable information, they can vary depending on the sector, the overall objectives of the company itself or the sales channel (for example, they can be different for online and physical sales).

However, there are a number of key indicators for any type of company that can be useful.

1. Sales growth

A company should aim to grow. If you sell nails, you have to sell more nails year after year. If you sell industrial parts, you should sell more industrial parts year after year. 

The point is to increase sales so as not to get stuck. For this reason, the first sales KPI should be to what extent business transactions increase or decrease.

Remember that, based on the information obtained, the appropriate analyzes must be carried out and points of improvement established.

2. Average Ticket

Its calculation is simple; You only have to divide the total turnover by the total number of orders placed. In this way, you will be aware of the average income you receive for each sale.

But beyond knowing what number of orders or transactions you must make to cover costs, this KPI can be useful to know how your customers behave with respect to your brand and the information it gives off helps you take actions to increase your income. 

In addition, thanks to it you will be able to make a series of marketing decisions such as volume discounts and other promotions.

3. Success rate

Let’s say you set a certain goal. As you probably know, the objectives should be:

  • Specific.
  • Measurable.
  • Attainable.
  • Relevant.
  • Temporary.

Therefore, a sales goal must be achievable and have a determined period of time established (a month, a quarter, a year, etc.). 

Well, the success rate tells you if you’re meeting sales targets regularly and by what percentage.

If your goal is 50 monthly sales (you can express it in terms of turnover as well) and you get 25. You have a 50% success rate (25/50 *100). 

By analyzing the evolution of this success rate, you can adjust your goals to (1) be more realistic and (2) if necessary, they could be more challenging and ambitious.

This KPI can also help you spot the most qualified sales force or the most effective channel (setting a success rate per person, channel, or any other parameter). In the same way, you will identify the weak points and you will be able to implement improvements.

4. Customer Acquisition Cost (CAC)

Another of the most important and general sales KPIs for all companies is the cost of getting customers.

A customer becomes a customer when they make the first purchase. But before this moment it is necessary to go through a process (from being a complete stranger to becoming a customer).

The conversion process is often called the sales funnel and it is necessary that you also analyze it, establishing the corresponding KPIs to understand how it develops and where your potential buyers (called “leads”) are.

Now, the process to get a client requires an investment. Therefore, each new customer represents a cost for your company and a certain strategy may not be as profitable as you may think.

To control these factors you can calculate the Customer Acquisition Cost dividing the total investment made in the conversion process by the total number of new customers actually achieved in a given period of time.

5. Conversion rate

This is a more important sales indicator. This sales KPI answers the question of how effective the sales strategy is. 

As we have said before, conversion consists of making a stranger become a customer. This KPI helps you determine the best strategies to achieve this.

To calculate the conversion rate you just have to divide the sales made by the number of leads (leads or sales opportunities) in a given period of time.

And so far the main fundamental sales KPIs in any strategic plan.

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