Best ways to measure performance of your sales or commercial team effectively

You can measure performance of your team or department in many different ways and you will probably find your own system, but there are some time-proven ways to get you started if you’re looking for inspiration or feedback on your way of measuring performance. 

But first let’s briefly sum up why it’s a good idea to measure performance of your team in the first place: 

• You will know who to praise and who to motivate - every person is different and everyone is motivated by different things. If you see some people on your team underperforming, it’s time to start asking questions about what's wrong. With performance measuring, you will know if your team is running at peak performance.
• You will motivate all team members - by being fair and rewarding those who put in extra effort or just do their job really well, you will set an example for the rest of the team.
• You can optimize the team effectively. After you start measuring performance, you will soon clearly see strong suits of each member and can assign them to roles or accounts they might be the best fit for. Without it, you’d be just shooting blindly. Your gut feeling is important, but so is double-checking with data from time to time in order not to succumb to logical fallacies.

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How to measure performance of any team? 

There are a few general metrics you can start to follow right off the bat:

Job quality - The most difficult metric is also the most important. Quality is measured differently for every job role there is. For a graphic designer this might mean submitting work beloved by both your creative director and the client. For a manager this might mean that the team he/she is managing is performing at 100% and there is little to no fluctuation. For an office manager the quality might be represented by the office running smoothly without any major issues. And for a sales person this might mean more acquisitions but also better relationships with clients, leading to higher retention. 

‍Initiative - You can spot future top performers and leaders by following this metric. People with high initiative are often overachievers who put in extra effort. Just remember they expect to be rewarded for it in due time by a raise or promotion. 

‍Efficiency - How efficient your team members are should be the bread and butter of your job if you’re in a management position. Efficiency means completing tasks in time, never submitting substandard work and not spending time ineffectively (e. g. it’s better to ask for help or suggest changes if it might lead to saving time and finishing projects faster). If someone’s not working effectively, it might or might not be their fault and it might require some investigation on your part to find out what is wrong. 

‍Teamwork - Nobody wants to work with an egocentric choleric who wants all the praise for him/herself or a depressed loner with no energy who refuses to help with anything. Follow your team’s inner dynamic closely to spot and deal with personal issues in the beginning before they become an issue. A well-working team is one where people count on each other, know their strengths and weaknesses and can improvise on the spot without a manager telling them what to do. 

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How to measure performance of a sales team? 

Measuring sales or commercial teams can be tricky but there are some proven ways how to start if you’re at your wits end.

‍Revenue per customer or account - By finding out which customers bring you the most revenue you can not only decide where to focus your efforts, but also investigate if the account is bringing in as much value as possible and if it’s being worked by the right person. 

‍Revenue from new vs. existing customers - Following this metric might tell you several things. If new customers are overperforming existing ones by a significant margin, there might be something wrong with your customer retention or upselling tactics. If most of your money comes from existing customers on the other hand, you should look into boosting your acquisition efforts. 

‍Success rate - This is one of the simplest metrics you can follow to find out if your team members are doing a good job or not. By measuring performance this way you can move your sales reps around to see if they would be better off in another position or working on another client.

‍Quotas - Each sales rep should have a quota of customers or revenue that he/she has to meet. Follow this metric to spot underperformers and overachievers but also to see if you’re setting up realistic targets. If nobody on your team is meeting quotas long-term, chances are you have to lower your expectations or invest more in hiring new people or providing the existing team with some advanced BI Tools (like Market Meter or Outlet Census in the on-trade / HoReCa sales sector) for increasing their effectiveness. 

‍Expenses vs. revenue - Always keep an eye on how much it costs you to acquire and also retain a client versus how much value that client brings you. In one of our researches we have calculated it might cost on-trade / HoReCa producers or vendors up to 2 000 000 € annually just to keep track of the potential customer universe and the changes it undergoes. Keep an eye on hidden costs that might be eating away at your profits.

There are many other metrics you can follow or different approaches to measuring performance. It all depends on your company’s and teams’ specific context and goals. This overview should provide you with some 101 basics that you can build upon. You can be creative even when measuring performance! 

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Measure performance in the on-trade / HoReCa sector with ease

If you’re working for a producer or vendor in the on-trade / HoReCa sector (soft drink companies like Coca-Cola, beer producers like Heineken, spirits producers like Rémy Cointreau, retailers like Tesco or Metro etc.) you might have a use for SharpGrid tool called Market Meter. This next-gen market reporting tool was designed with decision-makers' needs in mind and allows you to monitor the market from the highest level down to the last detail with totally granular data. 

‍Try the free version of Market Meter with limited functionality now

This way, you can also measure performance of your sales teams quite effectively by seeing which regions, cities or custom areas or categories  defined by you are underperforming or overperforming and can act quickly on this knowledge. The report is updated each quarter and always includes fresh data. 

If you simply want to increase your team’s performance, save your and their time and acquire more customers in less time, check out the Outlet Census tool trusted by companies like Coca-Cola, Heineken, Unilever and others. 

‍Find out how our clients are succeeding with Outlet Census on our Success Stories section