The Ultimate Guide to Sales Strategy

Chapter 5

Measuring Success with Sales Reporting

Measuring Success with Sales Reporting and KPIs

How to Understand Sales Performance with KPIs

At this point, you’re tracking your sales pipeline, creating awesome proposals, and offering low-friction financing options; great! But what does it all mean?

It’s essential that you have eyes on the numbers, or you may miss opportunities to make vital improvements. The good news is, by taking a more methodical approach to your sales strategy, you’re setting yourself up to better measure your performance at each stage. But that’s why you need sales KPIs and sales reports to learn from.

With these statistics, you can answer questions like:

  • Are you closing enough deals?
  • Are your jobs profitable?
  • Is anyone in your team underperforming?

To do sales well, you’ll need to be able to answer all of the above and more.

The great thing is, numbers don’t lie. Sales reporting tools can help you pinpoint and record specific sales pipeline metrics that are crucial to the profitability of your business.

Taking the time to understand the different successful aspects of your sales strategy will allow you to see what’s going well, what you can do better, and help you lay out a plan for better results in the future.

Why Sales Reports and KPIs Matter

Key Performance Indicators (KPIs) are vital, and specific metrics will help measure your success. You’ll need to think about exactly what sales KPIs make sense for your business, industry, and team, as there’s no one-size-fits-all approach you can take.

Of course, the biggest indicator of all is your bottom line: how much money is your business making? However, by tracking multiple KPIs to monitor sales activity, you’ll get a much more complete assessment of your sales strategy’s strengths and weaknesses, as well as the success or shortcomings of sales performance.

Key Performance Indicators (KPIs)

Essential metrics used to measure the success of your business strategy. For example, number of jobs per month, profit margins per job, etc.

Common Sales Metrics Include:

Total opportunities won: Simply the total number of deals marked as won

Total value of opportunities won: The total income generated from all won deals

Total profit of opportunities won: The total income generated from all won deals, minus the operational costs of those jobs

Win rate: The total number of opportunities won, divided by total opportunities

Total open opportunities: The total number of opportunities still in progress.

Total value of open opportunities: The total (estimated) value of all opportunities still in progress. This represents current sales potential.

Profit per type of work: The total income generated from all won deals within a certain category, minus the operational costs of those jobs

Avg. length of sales cycle: The average time (in days) that it takes from adding a new opportunity to winning the deal

Revenue from add-ons: The total value of all sold add-ons in isolation

Total value of discounts provided: The total value of discounts provided in won deals. This metric is assessed by how low the value is.

Turning Sales KPIs into Business Insights

Now that you have an idea about which sales KPIs to measure, the challenge still remains, how do you extract insights from them? Essentially, you know your numbers… but what do they really mean?

The reality is it will take time and effort to analyse your sales reports. You’ll need to investigate multiple metrics, assess your sales team’s performance, and ask yourself the right questions. However, it’s absolutely worth doing on a regular basis. It’s the only way you can move your business forward with confidence.

Let’s look at a theoretical example and examine some high level questions you may need to think about.

“Total deals won is increasing, but total profit is not matching”

Your sales team is closing more deals than before, but the total value of those deals is lower too. Essentially, you’re creating more work, but not creating much more money.

Sales reporting graph

Questions to Ask When Analysing Your Sales KPIs:

Are you winning the sort of jobs you want to?

  • Every business will have low-margin and high-margin work; is it possible your marketing is attracting too much low-margin work?
  • Is your sales team over-prioritising low-margin work because they are easy wins?

Where in the pipeline are you losing high-margin opportunities?

  • Are they reaching the proposal stage? If yes, you may want to review your proposals and follow ups to see if they can be improved
  • Do you simply have fewer high-margin enquiries than before? Should you consider reviewing your marketing?

Have your costs increased?

  • If your costs have increased, have you reflected that in the price you charge?

Is your team offering too many discounts in order to win jobs?

  • Discounts are a double-edged sword. They can be the push that a prospect needs, but too many will hurt profitability. You may need to talk to your team.

Is your team selling less add-ons?

  • Add-ons can be a substantial contribution to your revenue. Is your team including them in proposals? If customers are not choosing them, you may need to review which add-ons you include and their price.

Setting Sales Goals

Company Goals

Goals are critical in order to benchmark your success. Defining yearly, quarterly, and monthly goals can help give you perspective on whether your sales strategy is working. Sales reporting is where you gauge the impact of your goals. Further, a sales budgeting system will help your team understand how each of your services affects business profits. You’ll need to base these goals on your running costs and your overall company objectives.

For example, if you wish to hire another five employees next year, how much money do you need to make this year to make such an investment feasible?

You may find that you need to change or revise your goals and the KPIs you set as the year goes by. If you are blowing your goals out of the water with minimal effort, you might consider increasing them. Meanwhile, external factors or staff changes may make it near-impossible for you to reach other goals, in which case they may need to be reevaluated.

Team Goals

Individual teams should have goals too, which is why KPIs for entire teams can be a great idea. These will feed into your overarching company goals. It’s important that these team KPIs and goals are achievable and that you link them to initiatives you and your team are actively taking. If you wish to increase your win rate by 10%, what exactly will you do to achieve that goal and meet the KPI target? Telling your team that you expect them to drive up their numbers, without a plan to do so is a surefire way to cause frustration.

Individual Employee Goals

Employees (especially those making sales) should understand what is expected of them and how they contribute to the bigger picture. If you expect £X revenue from your sales team, how much of that needs to be contributed by whom? You should base individual goals and their sales KPIs off an employee’s seniority, experience, and track record to make sure they are reflective of their potential.

Each salesperson should know their personal sales KPIs and the goals to shoot for. This will inform how they work to influence the team’s collective goals. Ideally, they should understand the context of why their goals are important and how their KPIs matter as they strive to meet the company’s overall objectives.

Learning From Your Proposals

Beyond the quantifiable numbers of your sales KPIs and reports, it’s also revealing to analyse your sales proposals and assess them from a qualitative perspective – are they as good as they can be?

Take time to reflect on your lost proposals and see if you can glean any insights into why it wasn’t successful. If you were able to record the reason that the customer didn’t accept at the time, then this is your opportunity to assess that further. Was it anything that you could change? Are you displaying value, expertise, and trust that aligns with your prospect?

This is how you learn and improve.

Furthermore, your sales team can compile a list of lost prospects to follow up with or revisit in the future. Just because the prospect wasn’t ready to move forward with the service you offered, doesn’t mean they won’t have a need for your business in the future.

It’s just as important to understand why you’re winning proposals, as it is to understand why you lose them too. Obviously, winning highlights what you do well. But is there anything from your successful proposals that you could replicate in others? Understanding the specific reasons why prospects pick your proposal over another will help you scale your business and provide better service.

You may even find you need to shake your proposals up as time goes by. Don’t be afraid to revisit the structure and design of your proposals to make sure you have a fresh and up-to-date look.


Do you know your sales conversion rate (the percentage of your leads that turn into paying customers)?

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Next Chapter:

6 Implementing Your Own Sales Strategy

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