5 Key Metrics Every Building Material Salesperson Should Monitor

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Let’s consider this scenario; Mark is a sales rep for a company that supplies construction materials such as cement, lumber, and roofing materials. His main responsibilities are generating leads, engaging with potential customers, and converting them into clients. Mark spends a significant portion of his time making outbound calls to builders, architects, contractors, and construction project managers. During these calls, Mark’s main objective is to schedule initial face-to-face meetings with potential leads and convert them into opportunities.

However, Mark has been struggling to book any meetings and hit his sales quota. Mark’s efficiency heavily relies on how quickly he can move leads through the sales pipeline, speak to decision makers, book meetings with them, qualify them into opportunities and close deals. However, Mark spends more time dialling without being able to reach the main decision makers. When he does reach a decision maker, although he has some great conversations, he doesn’t seem to be able to close many meetings. Once he does meet with the decision makers, many don’t qualify as he is often booking meetings with unqualified leads that don’t have a need, budget or authority. When a lead does turn into an opportunity, Mark takes a long time to close them. This can lead to missed opportunities, delayed revenue, and increased costs. Sometimes it is discovered that a lead was lost because he missed the buying window. When doing pipeline reviews with his manager, it seems like Mark has many leads in his pipeline, but when taking a closer look, many don’t qualify.

So, what can Mark do differently to optimise his outreach and be more efficient? He needs to know his numbers so he can refine his strategy. As the saying goes, you can’t manage what you don’t measure. Like many salespeople, Mark is a people’s person and does not like numbers. So therefore his results are not consistent.

Although these numbers are easy to track through his CRM, he will need to make tracking them a discipline.

Here are the 5 key metrics that someone in Mark’s position will need to learn and measure.

1. Average ratio of outbound calls/visits to contact made with decision maker.
2. Average ratio of outbound calls/visits to initial meetings booked.
3. Average ratio of initial meetings to qualified opportunities.
4. Average ratio of proposals sent to opportunities won.
5. Average time to close an opportunity.

This is the average number of outgoing calls or visits that a sales rep has to make until they have a conversation with one lead. Suppose they had to make over 20 calls to reach one lead. In this case, their ratio would be 20:1 (20 calls per successful contact). This low ‘contact made’ ratio indicates that the sales rep’s outreach method may need adjustment. Their low ‘contact made’ ratio affects their ratio to booked meetings, and lead conversion. As a result, the sales rep ends up spending more time dialling than having meaningful conversations.

Some things the sales rep should consider when trying to make contact with a decision maker:

• Are they wasting a lot of time during golden hours on admin and research, rather than dialling?
• Is their database correct and up to date?
• Are they using prospecting technology that gives them enough mobile phone numbers of decision makers so they can cut through switch boards and gatekeepers?
• Do they know how to get through gatekeepers if all they have is a landline phone number?
• Is the sales rep dialling during a time and day that the decision maker is most likely to be available?

This is the average ratio of outbound calls or visits to the initial sales meetings booked with decision makers. This ratio helps the sales rep assess the effectiveness of their outreach method. When a sales rep spends excessive time on sales calls or visits without the ability to fill their calendar, they waste lot of time, opportunities and resources. It also affects their ability to close deals. As a result, their numbers will suffer at the end of the quarter.

Also, another reason why understanding this metric is crucial for sales reps, is it gives them valuable insights into the amount of work needed to achieve their goals. For instance, if a sales rep knows that it typically takes 10 meetings to secure 2 deals, they can better measure the effort needed to reach their targets. This knowledge gives clarity on the number of scheduled meetings necessary to convert opportunities into successful sales.

Some things sales rep should consider when trying to close a prospect on an initial meeting:

• Their (ICP) ideal customer profile. Is their message targeted to their ICP?
• Is their opener relevant to the persona and company they as speaking with?
• Do they create enough curiousity and interest when opening the conversation?
• Are they speaking with key decision makers?
• Do they warm up the lead and close on micro commitments and next steps? Such as a follow up call or sending more information.
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However, a low ratio doesn’t always mean it’s a bad thing. It’s important to be careful about booking too many meetings with leads that don’t qualify. This is what I usually call, ‘feel good leads/pipeline.’ They are easy meetings to get, feel good to have them in your pipeline, but hard to advance into opportunities.

Qualified opportunities are prospects who meet a certain criteria on demonstrating a high probability of closing a deal. The average ratio of initial meetings to qualified opportunities measures the average of how many of those sales meetings turn into a qualified opportunity. For example, if the sales rep conducts 20 sales meetings in the month, and 12 turn into qualified opportunities, then their initial meetings to qualified opportunities ratio is 60%. Is 60% adequate? Well that all depends on your sales cycle, deal size and your average proposals sent to opportunities won ratio.

Some factors that may influence a meeting turning into an opportunity:

• The quality of the lead. Does this lead fit the (ICP) ideal customer profile?
• Do they have a high level of interest, need or problem that needs urgent attention?
• Do they have decision making authority?
• Do they have the budget?
• Did the sales rep build enough rapport, credibility and trust?
• Did the sales rep ask solutions-based questions?
• Did the sales rep show real life case studies and success stories of similar customers?
• Did the sales rep really listen, and pitch based on the unique needs?
• Did the sales rep ask for a micro commitment and establish next steps?
• Did the sales rep follow up accordingly?

A RFP win rate (also known as your bid-to-win ratio) is the percentage of proposals sent that lead to winning deals. For example, if the sales rep submits 154 RFPs yearly and successfully wins 62, their win rate would be 40%.

Some factors that may influence won and lost RFPs:

• Does the decision maker have the budget and finances to purchase?
• Does the proposal sent resonate with the decision maker/s needs?
• Did the proposal sent demonstrate that the problems/needs were understood?
• Was a solution tailored to the specific problems/needs?
• Was the sales rep able to address objections effectively?
• Does the sales rep seek feedback for deals lost/won to continuously learn and refine their approach?

This is the average time between that first time meeting with the decision maker and an opportunity that was won. Why is this ratio important to track? Because a sales rep’s efficiency to quickly move leads through the pipeline will maximise revenue generation. It’s also important to have predictability and be able to forecast well.

Some factors that may influence time to close:

• As mentioned above, quality of the lead. Do they have the need, urgency, decision making authority and budget?
• Is the sales rep upfront and clear about pricing early on? By doing so, they quickly determine if the prospect has the budget and is a good fit for their products or services.
• The complexity of the deal. A large project with several decision makers may take a lot longer to close than your small home construction project.
• Lead source: For example, referrals may close faster than cold leads.
• Timeline: Does the sales rep take the time to understand their level of urgency and timeline?

To conclude, sales is a science just as much as it is an art. The success of a of a sales rep also lies in knowing their numbers. By tracking these metrics, they have the ability to refine their strategy, predict revenue, optimise their outreach, and build a robust pipeline of qualified opportunities.