What exactly happens when one of your crucial KPIs starts showing signs of distress, or when you're thinking about increasing ad spend or investing more in marketing efforts? That's where additional metrics come into play, offering an in-depth view and helping you troubleshoot potential issues effectively.
What exactly happens when one of your crucial KPIs starts showing signs of distress, or when you're thinking about increasing ad spend or investing more in marketing efforts? That's where additional metrics come into play, offering an in-depth view and helping you troubleshoot potential issues effectively.
In the previous episode, we discussed the top three key performance indicators, KPIs, that a well functioning sales system can offer. Propelling your kitchen and bath business towards greater profitability. This time around, we're venturing even deeper into the metrics that a sales system can provide. Shedding light on how to diagnose issues if your KPI, check engine light, does happen to come on. So, what exactly happens when one of your crucial KPIs starts showing signs of distress? Or, when you're thinking about increasing ad spend or investing more in marketing efforts? That's where additional metrics come into play. Offering an in depth view and helping you troubleshoot potential issues effectively. Having your business data neatly organized within your system means you have the invaluable data points and analysis at your fingertips. Armed with this information, you can maximize your impact with minimal time investment. Easy access to metrics paves the path to a more profitable business. You see, as an owner, when something warrants your attention, you can swiftly pinpoint the root of the problem, as opposed to rustling with uncertainty, watching money trickle away from a subpar lead source, or chasing unqualified prospects. So, what are the additional metrics that a robust sales system can provide, and how do you leverage them? First up, is your average close rate. This metric offers valuable insights into both lead quality and process effectiveness. The close rate is the percentage of leads that result in a sale. A good close rate is above 50%, meaning that out of 10 leads, five of them become clients. If you find that your close rate is lower than 50%, you might wanna investigate further. Are the leads of lower quality or is there an issue with your sales process that's hindering conversion? Monitoring your average close rate can help you fine tune your marketing, ensuring that you're focusing on high quality leads, and optimizing your processes for better conversion rates. Next, let's look at average deal value. This metric provides a clear picture of how many leads you need to reach your revenue target. The value of an average lead can fluctuate based on You know, a variety of factors, and it's important to monitor this metric over time. If you notice a downward trend, it could be that you're still closing the same number of deals, but they're for smaller amounts. And it could mean that the more deals and leads are required to hit your revenue target. On the flip side, if your average deal value is increasing, You might need to consider capacity and timing issues, as these larger deals could take longer to close and deliver. Another metric to watch is percentage of qualified leads. If out of ten leads, only three are qualified as sales ready, you might need to re evaluate your lead sources. If a significant percentage of your leads are unqualified, it's time to rethink your lead generation strategy and focus just on the channels that deliver better qualified prospects. This metric also provides insight into the effectiveness of your lead nurturing process and helps you allocate resources more effectively. Lastly, don't overlook the number of days in each stage metric. This metric tracks how long leads remain in each stage of your sales process. It's essential for identifying bottlenecks and process inefficiencies. For example, if a prospect is lingering too long in one stage, it's a sign that they may need more attention or nurturing. By monitoring the number of days in each stage, you can uncover areas where leads often get stuck, refining your processes, and ensuring a smoother, more efficient journey for your prospects. These metrics serve as a way to know where to focus attention, illuminating potential areas for improvement, indicating lead quality, process efficiency, and the overall health of your sales system. Armed with this data, you can make more informed decisions about your lead sources. Transcripts are a great way to get started. You can use them to help you plan your business, your sales processes, and capacity planning, all while ensuring that your kitchen and bath design business remains on a path to profitability. The result is a more streamlined and profitable business, allowing you to focus your time and resources on what truly matters, designing beautiful spaces and delivering exceptional client experiences. These supplementary metrics, combined with the core KPIs we discussed in the previous episode, form a comprehensive dashboard that can help you manage your business. more effectively. With this level of detail and data analysis, you can overcome challenges and maintain the predictability of your profitable business. So, next time you see the check engine light flicker in your business, remember these metrics are your trusty tools for diagnosing and resolving the issues, helping your business stay on the road to success. Coming up next, we'll wrap up our series on KPIs. By looking at their value, not just as health indicators, but also as an information source on where to take action to maximize your profitability. Hire Help, my book on how to use experts to shortcut improvement, growth and capacity is now available. Get all the details and buy it by going to HireHelpBook. com. Like what you heard? Never miss an episode by subscribing. You'll find this podcast on Apple. Spotify, Amazon, iHeartRadio, and everywhere else you get your podcasts.
