KPI, Key Performance Indicators. All great salespeople understand what activities it takes to succeed. And they measure what they do to be sure they are on target. KPI’s are the score card salespeople use. So what are the key performance indicators for you?
KPI In Selling
Selling is a numbers game. Great salespeople know the way to achieve the ultimate goal is to set and achieve activity-based goals. They have written goals and intermediate objectives. Activity-based goals are targets set on goal achieving actions the salesperson has control over. Great salespeople track their KPI. They know which activities pay off and how many times they need to do them to be successful. So here are the typical KPI’s for a salesperson tracked over a convenient time period: dollar value of sales, number of sales won, number of qualified prospects, success rate of appointment setting and number of prospect or customer contacts.
Here Is How KPI Is Useful
Working backwards from the number of orders desired per month to meet the bookings goal, use the closing ratio to determine the number of prospects to pitch. When the closing ratio is 50% and the number of orders per month is 20 then the great salesperson knows to have 40 prospects in the que ready to close at all times. By tracking their activities, salespeople know they need 3 prospect meetings to find a qualified prospect; then they have to average 120 prospect meetings a month. Again tracking the effort it takes to get a prospect meeting, the great salesperson knows they need to dial the phone 10 times to schedule a prospect meeting. So the activity objective which sets up success at all other intermediate goals is consistently dialing the phone 120 times per month. The one activity here the salesperson has total control over is the number of times they dial the phone. Great salespeople always know their dialing KPI.
Start With The End In Mind
Great salespeople know where they are going. They are proficient goal setters. Some goals and the KPI that go along with tracking progress are set by the company. For example orders for the month, sales of a particular product or new customers. Other goals are jointly set based on the needs of the company and the particular sales territory. Such as, number of sales calls, number of closing pitches and selling activity time. Each goal has a plan of activities needed to meet it. For experienced salespeople those activity levels are determined from the KPI history. By tracking the activity quality and quantity, salespeople know what is needed to reach the sales goals for their territory.
What Can You Do Right Now About Your KPI?
- List all your key performance indicators
- Assign the benchmark for each indicator activity you can control
- Measure the KPI consistently and analyze your performance