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Understand Your Revenue to Grow Your Business

The numbers tell a story – read it in your CRM

As the saying goes, “You can’t fix what you don’t know.”

A surprising number of decision makers look at their company’s bottom line and immediately start to change products and services to increase revenue. That might work in some cases. But a more prudent approach is to include a review of your sales process, because it might be where you can make the most impact on your bottom line— with the least effort.

It doesn’t take “big data” or hours of poring over spreadsheets to precisely determine how you generate sales. And it doesn’t have to cost a lot of money to set up or maintain. Here’s how to do it:

Take Stock of Your Sales CRM

If you have a CRM (like Salesforce or Oracle), you can run reports that provide you with the information you will need. If  you don’t, you can set up a simple Excel spreadsheet that will obtain similar insights.

How to set up a CRM spreadsheet:

  1. List all your customers (make sure to separate them by first name and last name so that you can easily export this list to other programs later). 
  2. Add fields for other relevant pieces of information (e.g.,  email, mailing address, company, etc.). The more info you capture, the better. You’ll be glad you did.
  3. Add columns to capture the following information: 
    1. Where did the sale come from?  You need to know where your sales are coming from in order to focus your time and attention in the right places to obtain more. 

      It is important to answer this question as specifically as possible. For example, did you meet this customer at a tradeshow? Did they find you online? Were they a referral? If so, who referred them to you?

      If multiple salespeople will be accessing your spreadsheet, make sure everyone is entering information that will yield insights. It’s not enough to say, “Tradeshow” for example.. You need to know which tradeshow.

    2. Which product(s) or service(s) did they buy?  You want to break this down as much as possible. If possible, try to list the individual items or services they bought, rather than the category they belong to.
    3. How much revenue was earned? Depending on how you divide up your services or products, you want to be able to assign profitability numbers to each. This will allow you to review categories (“tradeshows” for instance) and determine your ROI by each tradeshow your company attended. This, in turn, can inform your decision to participate in following year’s tradeshow or not.
    4. How often does the customer purchase?  Do the majority of your customers buy once? Do they place an order every two months? The frequency of their purchases will help you understand how often to communicate with them.
    5. How can you contact the customer?  Ideally, you will already have an email address. Pay attention to whether or not the contact is the decision maker for their company. For example, if you have the bookkeeper’s info, make note that they are not the decision maker and try to obtain the necessary information.

Assess Your Situation (Review your CRM)

The numbers always tell the story. Use the information collected in your CRM to identify these four key metrics:

  1. Where  your opportunities for upsell and xsell are
  2. Who/what your best referral sources are
  3. Who your best customers are
  4. What  your most profitable products/services are

Now that you have a system in place, it will be easy to see what’s working and what isn’t. Review this information with your sales team, and use it to adjust your sales and marketing strategy.