Must Have Metrics to Conduct a Sales Review

A sales review is a crucial business evaluation process that provides an overview of how an organization is doing in terms of its sales performance. This review is intended to assist management to review progress against the plan, make course corrections, and drive key programs.

Typically, a review involves gathering, analyzing, and presenting data from various sources. This information is used to closely review, track and improve business performance across multiple metrics.

What Is A Sales Review?

The sales review examines with a fine-tooth comb how well your company is doing by comparing the outcomes of initiatives to objectives and determining how well your organization met your sales goals.

It is a collection of analytics and performance management processes that enable the improvement of business performance and the achievement of targets. This review can be performed at any level: project, business unit, or the whole enterprise. Good organizations have a habit of conducting frequent business reviews to ensure proper leadership oversight and expectation setting at all levels.

What Is The Purpose Of Sales Review?

The purpose of a sales review is to provide management with a clear and precise picture of the company’s sales performance. This includes decoding current performance levels, setting realistic business goals, and assessing weaknesses to improve.

Every business has unique metrics that must be tracked to improve its sales performance depending on the state of its growth cycle. For example, growing companies might want to focus on customer acquisition, whereas mature companies may put more emphasis on profitability/margins on deals.

What Metrics Do You Need To Consider For A Sales Review?

Sales metrics are critical in evaluating a company based on specific business aspects. To expand a business, critical decisions must be made in areas such as direct sales, Telesales, Digital/social media selling, etc. Business metrics, also known as Key Performance Indicators (KPIs), aid in completing a successful business review.

Numerous business metrics can be tracked, but the metrics chosen depend on your business’s type, industry, and goals. Business metrics are quantifiable measures that are used to track, monitor, and analyze the success or failure of a business process. These metrics provide context for the business before delving into the core business data.

Here are some most important business metrics that will ease down the sales review process.

1. Customer Acquisition Cost

Companies typically acquire new customers through costly marketing initiatives. This is referred to as the Cost of customer acquisition, CAC, or customer acquisition costs. A company’s customer acquisition costs can be calculated by dividing its marketing expenses for a given period by the number of new clients acquired during that period:

2. Customer Retention Rate

In any industry, building brand loyalty is critical. Aside from resulting in repeat purchases, excellent customer retention frequently results in customers telling others about your company’s services or products, resulting in even more sales.

If you want to increase brand loyalty, you must first provide quality services and/or products, but providing excellent customer service is also essential. The following formula can be used to calculate the customer retention rate of your company:

3. Net Promoter Score (NPS)

This is your sales team’s most important business metric. This metric indicates how likely your customers are to recommend your product or service to others (friends and family).

It typically depicts your customers’ overall perception of your brand. The marketing and branding departments also use this metric to help improve their campaigns.

NPS can be calculated in a variety of ways, the most common of which is through a customer survey. The customer survey inquires as to how likely they are to recommend your company, brand, or product to their social circle.

There are three levels of customer advocacy, according to Net Promoter Network:

4. Sales Revenue

Revenue is one of the most insightful sales metrics. By assessing your company’s sales, you can determine how well your products or services are performing in the market and whether your marketing efforts are effective.

The sales revenue of a company can be calculated by adding the income from sales and then subtracting any costs associated with undeliverable or returned products:

A related metric that contextualizes sales performance is Revenue Achievement against targets. It can be calculated as follows,

5. Net Profit Margin

The net profit margin assesses a company’s ability to generate a profit with respect to its total revenue. Using this sales metric, you subtract all of your company’s sales expenses from monthly revenue to calculate how much profit was made:

Simply put, the net profit margin compares the company’s income to the costs of running the business, allowing you to predict long-term growth effectively. You can increase an organization’s net profit margin by increasing revenue or decreasing production or sales costs.

6. Average customer lifetime value (LTV)

Though determining a company’s customer acquisition cost is helpful, it is especially highlighted when compared to the customer lifetime value, also known as CLV, customer lifetime revenue, or CLR. This measure indicates how much sales you can anticipate generating from a typical customer. It needs a significant quantity of data to calculate a company’s customer lifetime value.

The methodology for calculating a company’s CLV ranges depending on the sales model. Still, in general, it is calculated by multiplying the value of an average sale by the retention period for a regular customer (in months) and the number of transactions they typically make in that time frame:

The average customer lifetime value is critical since it enables you to:

Determine how much the company can afford to spend on customer acquisition. Analyze the problems that are affecting customer retention. Discover which customer segments provide the highest profit or are the most difficult to convert.

7. Sales Win Rate %

The sales win rate is the percentage of open opportunities won by the company. It can be estimated for the entire sales team or each sales representative. If you have 200 sales opportunities and your sales team wins 50 of them, you will have a win rate of 25%.

You must ensure that you only list opportunities to whom you have submitted sales proposals and not those who have not been approached.

Average Sales Cycle

A sales cycle is the average time it takes to have a sales win. It is measured in terms of time, like days, weeks, or months. This measure will identify your bottlenecks and let you know which segment in your sales funnel needs the most attention. Moreover, the sales cycle can help you identify the critical areas within your sales funnel.

8. Average Deal Size

A sales cycle is the average amount of time it takes to close a deal. It is expressed in terms of timeframe, such as days, weeks, or months. This metric will detect bottlenecks and indicate which segments of your sales funnel require the most significant attention. Furthermore, the sales cycle may assist you in identifying the essential sections of your sales funnel.

Therefore, these are the most important business and sales metrics that will assist you in conducting a successful business review.

Some Best Sales Review Templates Examples 

Sales reviews are an excellent way to learn how to move your company forward. The sales review template provides you with a battle plan that you can use to evaluate your company’s performance and provide more value in the future.

These templates serve as an improvement plan for your company, outlining what needs to be improved in the future.

Here are some of the best business review templates that will help you analyze your business perform better and highlight the pain points.

Business Review Presentation

Business Review Presentation

Source: Business Review by SlideUpLift

Grab this stunning business review PowerPoint presentation template, perform, and nobody can stop you from achieving your business goals.

Business Review Snapshot

Business Review Dashboard

Source: Business Review Dashboard by SlideUpLift

Get a fantastic business review snapshot template for a quick business evaluation process.

Quarterly Business Review

Business Review Dashboard

Source: Business Review Dashboard by SlideUpLift

Get a data and stats-oriented quarterly business review template for accurate business analysis.

Net Promoter Score

Source: Net Promoter Score by SlideUpLift

Order Lost Analysis

Source: Order Lost Analysis by SlideUpLift

Wrapping It Up

A sales review can help you grow your company by analyzing the current performance and market trends. Therefore, planning all the future actions in accordance with the metrics and evaluations can lead to establishing a strong presence of your company in the competitive market.