PRIME: Measuring sales performance

What have you found is the best criteria to measure the performance of a salesperson?

November 15, 2013

Our PRIME advisory panel includes some of the remodeling industry’s top professionals. This month we asked, “what have you found is the best criteria to measure the performance of a salesperson?”

Volume versus goals
We compare the individual’s sales volume to his or her annual goals. In measuring closing ratio, we look at the amount of leads taken/amount of sales, then compare with the entire sales team. Margin management is very important to us and we measure each sales/designer’s margin and also compare this with the entire team. We consider customer feedback that we get through Guild Quality. We track each person and recognize special efforts in personal marketing efforts.
Tom Kelly, President
Neil Kelly, Portland, OR

Closing percentage and sales per lead
There are two metrics we look at in judging the performance of a salesman. These are net closing percentage and net sales per lead issued. The combination of these two metrics is the best gauge of their performance because they measure the net contracts and net revenue for every lead issued to that salesman. These metrics vary by each of the product lines that we carry.
Rob Levin, President
Statewide Remodeling, DFW, TX

Three degrees of sales performance
Our sales process, internally known as 3 Sales to a Sale, is structured to allow us to track individual sales performance on a number of levels. The first step, or sale if you will, we measure is the conversion of a raw inquiry into an initial design consultation conducted in our design center. There is no fee to the potential client for this first “Are we a good fit?” meeting. Next, we track the conversion from a consultation to a design client where there is a fee to begin the design process. This allows us to track the design closing percentage and design revenue generated. Finally, we measure conversion from design to build. Again, allowing us to track not only closing percentages but also build revenue. We also monitor is the number of days between a design sale and a build sale to give us insight as to sales efficiency.
Bill Simone, President
Custom Design & Construction, El Segundo, CA

Key performance indicators
We consider five key performance indicators of a sales person:
1. Gross sales volume
2. Gross margin of projects sold
3. Number of client complaints (or lack thereof)
4. Brand builder—truly advise and help clients despite a no-sale client, a true helper
5. Trainer — a team builder to help train and mentor other sales people.
Scott Mosby, President
Mosby Building Arts, St. Louis MO

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