It’s inevitable that every business will struggle with sales productivity now and then. And while there are many exterior factors that can impact sales productivity, there are plenty of factors that any sales team can control to help improve productivity as much as possible.
Perhaps you’re struggling to ramp new sales reps quickly. Or, maybe you’re looking for a better way to coach reps to improve their sales skills while they’re busy juggling making calls, delivering demos, and negotiating contracts. All of these elements can greatly impact how to measure sales performance. But, the good news is that there are plenty of tools, tactics, and strategies that sales leaders and organizations can use to improve sales productivity.
Sales Productivity Definition
Before we dive deep into all things sales productivity, it’s important to understand what the term sales productivity means and how to calculate it. Sales productivity is determined by comparing a team’s sales effectiveness to their sales efficiency. Simply put, sales effectiveness measures a sales team’s ability to succeed at individual stages of the selling process and earn business revenue on proper terms and within a predefined time frame.
Sales efficiency is the amount of new revenue a sales associate or team can generate for every unit of money put into producing, marketing, and selling a product. With that being said, the simplest sales productivity definition is the maximization of results and minimization of resource and finance inputs for the sale.
Sales Productivity Statistics
High sales productivity is the lifeblood of any business or organization. Without closing sales effectively, no company would gain customers or make a profit. This means that there needs to be some changes in the standard for the sales industry, and hopefully, we can clean up a few sales productivity statistics along the way.
For example, did you know that the average ramp time for newly hired sales reps is generally six to nine months? That means your sales team misses out on a lot of potential customers and revenue opportunities while they’re getting up-to-speed. Fortunately, you can significantly reduce the number of missed opportunities caused by long and inefficient onboarding and training. All you have to do is decrease the ramp-up time by implementing the proper sales training and enablement for your reps. These extra resources will allow them to meet their quotas an average of seven weeks faster than the industry norm.
Did you know there’s also a substantial disparity between the amount of revenue generated by a company’s best sales associates and those immediately below them? Recently, a Sales Talent Study found that in most businesses, the top 20% (on average) of sales reps produce over half of the company’s overall revenue. By providing all sales reps with the tools, training, and resources they need to sharpen their skills and increase their sales abilities, you may be able to minimize that gap.
The average sales rep spends around 43 hours searching for relevant information each month. Whether it’s about the product, their potential customer, or some other aspect of their job, it’s time that could be spent making sales and generating revenue. By routinely and adequately training your sales team and providing them with resources to share their knowledge more efficiently, you can decrease this time and thus allow them to focus on other aspects of the sales process.