By Michael Giudicissi, CSC, CHCSP, CPDSP
As a sales manager, you may track many different pieces of data from your reps. One of the very telling ratios to keep in mind is the Sales Calls per Referral ratio. There are actually 3 version of this ratio you may want to keep an eye on.
1. Number of sales calls to get the first referral – How many times does a rep call on a new account in order to generate the FIRST and most important referral? During our training and coaching, we see the “sweet spot” of getting this referral at somewhere between 3 and 6 sales calls. Sure, you maybe get a referral the first time you walk in the door, but that won’t happen most times. Making significantly more than 6 calls helps a referral source build a habit of NOT referring to you. What are the ratios on your team?
2. Number of sales calls to get a referral from an existing referral source – Once an account is referring to you, how often do you need to see/sell to them in order to generate the next referral? This is what we call a “comparative ratio” in that we want to compare the current ratio to the ratio from 3 months ago (for example). This will give us some clear insight into a rep’s progress in that account and tell us if the relationship is moving forward, backward, or not at all.
3. Number of overall sales calls to get ANY referral – This one is simple. Take the number of referrals gained in any one week and divide them into the total number of sales calls. For example, Rep Jones gets 5 referrals in a week and makes 40 sales calls. Jones’ ratio of calls to referrals is 8-1. What do we do with this? We can continue to monitor this ratio and see if Jones can work it down to 7-1, or 6.5-1 or so on….. The lower the ratio goes, the better job Jones is doing at selling your agency. The nice thing is that it matters not if Jones makes 30 or 50 sales calls per week, he (or she) will still generate an accurate measure of productivity. We can easily see if Jones is becoming more effective in his sales time or not.
Ratios can be an effective tool in the effective sales manager’s toolkit to take quick snapshots of performance, development and training or support needs. Try some with your sales team and see if you gain some new perspective to make them great!
Michael Giudicissi
Home Care Sales by Power Shot Training, Inc.
