So now we have covered why I think KPI’s are so amazing, how to figure out your accurate Gross Profit Margin, the importance of tracking your Weekly Gross Sales, and why increasing your Average Sales Per Receipt helps you work smarter instead of harder for the same goal. Now we are going to talk about the number of Sales Receipts or Work Orders completed.
If you read the previous blog, you might think for a moment that I am contradicting myself when I say the # of sales receipts is just as important as the average sales per receipt are to figuring out your business’ overall health and financial wellbeing. But I also pointed out that by increasing your average sales per transaction and reducing the number of times you have to repeat those “unpaid processes,” you free up more time to do more work within the same time and resources.
Let’s say you increase your average sales receipt by a mere 10%. If your average sale is $150, that’s an additional $15.00 per job. Most clients are happy with paying that little bit extra for something that is going to make their life a little bit safer, easier or more pleasant. So, with that increase, after every 10 jobs, you have an additional $150 in sales that you didn’t have before. You have two choices now – take a break, enjoy that “extra sale” that didn’t require more work, OR take advantage of that extra time by adding another job to your schedule and making an additional $150 + $15 sale!
It is your job as the owner or manager to make sure new and returning clients are constantly coming in the door. The number of sales receipts/work orders reflects whether that is happening or not. Having a high average sale $ is great – but it won’t go far if you don’t have enough work to keep everyone busy. You will still have to pay people – or let them go. I don’t know about you, but skilled, productive, loyal employees are insanely hard to find around here. When I find one, I do whatever I can to keep them. That means keeping them happily busy and making money! When you have technicians or skilled employees, the more work they perform, the happier they are. YES – happier. Nobody likes to be bored. Nobody likes to do busywork because the work they’ve been trained to do isn’t there.
When I look at a coaching client’s number of sales receipts, I am trying to find out:
- Are they booked solid or not? How much time is not being sold?
- How many new customers came in? Where did they hear about you?
- How many returning customers came in?
- Are the number of sales up or down from the same weeks the previous year?
- What are possible reasons for the increase or decrease in number of sales?
Again, the list can go on and on from there.
Each of these KPIs provides valuable information for identifying the strengths and weaknesses in your business. And each one has its own specialized areas of interest to tell you about. Sometimes they reflect a weakness in your sales force. Sometimes they tell a story about your service professionals. Always, they tell a story about you, the owner and/or manager. If you can embrace the good, the bad, and the ugly, you can turn a good business into a great business!