In a sales organization, the most important agenda is to make sales and contribute to the organization's growth. Every sales manager wants to position their company at the top in the market. But it is to highlight that growing your organization is not just about making sales.
It has a lot of specific factors that impact the sales and the details you close within the period. It is also followed by highlighting the pain points of who and what contributes to the success or lack of the sales.
Since the sales process involves different stages and factors, it is crucial to analyze them in detail, and this is where the sales reporting comes into the picture.
In this article, we will be discussing everything about sales reporting along with the following:
• What is sales reporting?
• Why is sales reporting important?
• What are the prerequisites of the sales report?
• What are the points to consider before sales reporting?
• Example of Sales report
• How to manage sales report effectively
What is sales reporting?
As a sales manager, managing a sales team involves not just one activity but a plethora of activities. From initiating the actions to the final closure of the deal, the list is endless.
So to keep a systematic record of the significant three activities, i.e., sales operations, sales strategy, and sales analysis- sales reports are prepared to give insights into the overall process.
In ordinary words, it is a process of keeping a systematic record of sales activities over a particular period.
The period can be either daily, weekly, fortnightly, monthly or quarterly.
With the process, you can
- Analyze the reports in detail and understand the working progress of your sales representative
- Reveal whether the team is on track to meet the required result
- Get alert about the potential issues and take constructive steps
The sales reporting process can be carried either by an individual sales representative or by the sales manager. It also includes data related to sales volume, new accounts, revenue generated, ongoing opportunities, and customer acquisition costs.
Once you are through with all the information and results, you can clearly understand your efforts and make constructive decisions about timelines, pricing, or other essentials to keep your business moving.
Why are sales reporting important?
Whether you are a small business or multiple giants, sales reporting is the most crucial factor that can help to optimize your sales process and growth strategy.
The sales reporting process helps the management keep in the loop of sales activities and enables understanding the factors behind the team's success or hindrance.
To present well, sales reporting can help you to analyze and answer the following essential questions that you need to address such as:
- Who are your ideal customers?
- What is the success rate of sales conversion?
- What are the factors that motivate new customers to buy?
- Are the sales representatives able to make their quota?
- Is the team performing well to meet specific goals?
- What are the factors that are causing hindrance to sales?
- Are there any bottlenecks involved in the sales pipeline?
- What is the forecast for sales for the next period?
- Why is the team member not able to close the deals?
- Will you be able to hit the target, or will you pull off?
- Which team member has made maximum sales?
- How were sales performing compared to the previous quarter?
Thus, all of these questions need to be answered and analyzed well.
Keeping a record of these transactions at each stage of the sales process can help you analyze and understand the team performance and areas where they need improvement.
All of the data and information bagged through these questions can increase the sales team's productivity and strength by presenting themselves better in front of the customers.
What are the prerequisites of the sales report?
A sales report consists of a range of brief insights and metrics about the performance.
It includes the specific and critical highlights, including a comprehensive overview, breakdown of sales conversions, and interpretation of the numbers.
Let's take a look at the four significant prerequisites required while preparing a sales report:
- Begin with an Overview
- Breakdown the insights in numbers
- Interpret your result
- Suggest suitable actions
1. Begin with an Overview
To begin with, your sales report focuses on presenting an overview that will help you share good and relevant stuff that you gathered. It is known as a summary or a key takeaway of the sales report.
The summary should answer the most important thing that you want to communicate through your report. It usually consists of the number of sales met and whether you can meet the quota.
There is no prescribed limit to writing a summary, but if you are preparing it weekly, then one paragraph is enough; otherwise, it may require one page quarterly.
2. Breakdown the insights in numbers
After you prepare a summary, include a section that focuses on the sales figures and detailed metrics related to sales.
Since it is a sales report, you need to quantify the details in terms of:
- Number of deals done
- Close rate
- Sales cycles length
3. Interpret your results
After a quantified presentation of the data, it is crucial to analyze and interpret your results. It may include a comparison with the past periods, and you can also use charts to visualize the numbers.
This is the most crucial section because it shows the factors that impacted the sales volume.
4. Suggest suitable actions
After you are done with the interpretation, the next step is to suggest the suitable actions you feel are essential to fit in the sales pipeline.
For example, if the results were satisfactory, identify what went wrong and describe how you can improve in the next quarter. If you exceeded the sales quota target, figure out how you used to deliver the results and replicate it in the future.
To sum up, the next time you prepare your sales report, make sure of these points as mentioned above.
What are the points to consider before sales reporting?
The sales metrics are the indicators that can help you understand the aspect of the sales operations, how it is performing, or whether you can achieve the targets.
Usually, there are several things that you can make a report on. But in general terms, the report should be on something that can improve the company's growth or measure the things that can help you make the best decisions.
If there is an aspect not relevant to your process, then there is no point in wasting time to measure it.
Following are the key fundamental points that you need to consider before you begin with the reporting process:
- The deal size
- The number of prospects and deals completed
- Velocity of sales
- Conversion rate
1. The deal size
The deal size refers to the sales contract that has different valuations and measures present in your pipeline. The deal size helps you to make quick and sound sales forecasts and strategies.
2. The number of prospects and deals completed
It refers to the number of prospects within your pipeline and the total number of deals you have completed.
When talking about sales completed, it is straightforward, and you can count.
When talking about the number of prospects, it is crucial to know the expected conversion rate or whether they are turning out off the campaign.
3. Velocity of sales
The sales velocity refers to the average time that a lead takes to enter into the sales pipeline until the final conversion. It is basically known as a sales cycle time.
For example, it can be either two days, ten days, or maybe 15 days. A faster sales cycle leads to faster conversions and vice versa.
4. Conversion rate
The conversion rate is simple to determine the average number of deals you close within the specified period.
You can also compare with the past results. Hence, it is always essential to set averages and prescribe targets required at every stage of the sales process.
Example of Sales report
Following is a specimen of a sales report:
- New customers added
- Sales revenue
- Profit earned
- Weekly sales revenue
- Percentage of target
- The average revenue per unit
- Customer value
- Customer acquisition cost
How to manage sales reports effectively?
Drafting and sharing the sales report is not an easy job. It is very tedious and takes a lot of time to present and compile the data accurately.
However, with the help of the following tips, you will be able to manage your sales report effectively:
- Create a sales report with a specific goal
- Standardize the process of metrics and data submission
- Schedule a time for sales reporting
- Automate the process with the help of a CRM solution
1. Create a sales report with a specific goal
While creating a sales report, it is better to set the goals and benchmark in advance. It will help you to outline the questions and answer them well in the sales report.
For example, suppose you have set a goal to optimize revenue from the existing customers. In that case, your sales report should have the highlights of sales activity related to upselling and how it made a profit concerning those accounts.
2. Standardize the process of metrics and data submission
Organizing a large chunk of data into a standardized process can help you track down the critical metrics and communicate accordingly with the team.
As far as the data submission is concerned, you can use templates or CRM solutions that can track down and format information based on the sales activities
3. Schedule a time for sales reporting
It is recommended to report the sales regularly to not feel like a burden at the end. Fix a proper schedule and time-be it daily, weekly, fortnightly, or monthly.
The process will help you move in the right direction and take the necessary decisions regarding sales forecasting, quotas and pricing.
4. Automate the process with the help of a CRM solution
To ease down the working process, you can use automated CRM platforms like Deskera to streamline the tracking sales reporting process and data visualization.
The platform will ensure automatic updating and put in the relevant data required to make your reporting more straightforward.
This detailed article covered a detailed guide about sales reporting, what it includes, and how to manage it effectively. By practicing sales reporting, you will be able to make crucial business decisions by having a clear picture of the company sales and factors affecting the company's growth.
You will be in a position to focus on the quantitative and measurable activities to get precise outcomes and guide your sales teams with suitable actions.
Let's take a look at the key takeaways of the article:
- Sales reporting refers to a process of keeping a systematic record of sales activities over a particular period.
- It includes three major activities, i.e., sales operations, sales strategy, and sales analysis.
- The sales reports also include data related to sales volume, revenue generated, and customer acquisition costs.
- The sales reporting helps you to analyze and answer a few questions necessary for the growth strategy.
- A sales report consists of a wide range of insights and metrics showcasing the sales performance.
- The sales report consists of four significant prerequisites.
- The four prerequisites include an overview, breaking the insights into numbers, interpreting results, and suggesting suitable actions and actions.
- The sales metrics in themselves are indicators that help to know about the sales performance.
- There are four critical fundamental points that one needs to consider before beginning with the reporting process.
- The key points include the deal size, number of prospects, velocity of sales, and conversion rate.
- An example of a sales report includes sales revenue; profit earned, customer value, and average revenue
How Deskera Can Assist You?
When you are running your own business, there are tons of duties and responsibilities that you have to fulfill. Using the Deskera CRM system, you can manage your contacts, leads and reporting. You can use the CRM system to manage all customer data and reports. Deskera makes sales reporting easy.
Doing so will help you to save the time taken in transferring customer data between the different systems. It will also assist you with real-time updates about your business like cash flow status, customer satisfaction, inventory management, sales, purchases, purchase orders, customer tickets, customer satisfaction, managing leads, revenues, profit, and loss statements, and balance sheets.
Moreover, it would also help in integrating sales methodology across different platforms onto one system so that you have a consolidated list for email campaigns, leads management, and sales pipeline to mention a few.
It will also help you to sync between your orders, payments, taxes, refunds, product variants, sending out invoices and reminders, facilitating invoice management, and even undertaking follow-ups and advertisement campaigns.
Such a consolidated platform will help you to improve your sales through building effective sales compensation plans and also facilitate faster and well-informed decision-making. It will help you in strengthening your opportunities and being braced for the threats.