A sales analysis report is to a business as a car dashboard is to a driver.
Without the flashing signals and the arrow pointing beyond the allowed range, a driver would have no idea something is wrong with the vehicle; exorbitant fines are on the way or the car can incur damage every mile.
Read on to find out how to create sales analysis reports, what data to collect, how to interpret resulting tables, and convert them into effective action points for your sales operations, sales team, and marketing departments.
What Is Sales Analysis?
The sales analysis report is a set of analytical data that provides an overview, trends, and particulars of a wealth of metrics pertaining to the sales process & its results, which are used by company leadership to monitor the sales dynamics and improve results.
Sales analytics is an indispensable and fundamental tool for business of any size: starting from small to medium business to big multinational corporations.
Now that we’ve discussed what a sales analysis report is, let’s deep dive into the particulars of the reporting process to improve sales performance and drive the bottom line.
Importance of Sales Analysis & Benefits of Actioning Data Timely
The rise of big data allows us to drill down as granularly as needed in any aspect of the sales process so that to better understand the efficiencies of each sales rep, the profitability of each item in stock, timely spot the underperforming units, and increase market share.
A properly established process of creation, analysis, and actioning of the sales data is vital to a company’s success and survival.
It is pretty easy to make a sales analysis report. But it takes sales acumen and entrepreneurial vision to be able to interpret it and convert the data points from the sheet into actions to enhance your business.
Sales data analysis is fundamental to gain the following benefits:
- Keep your sales team aware of the market, industry, macroeconomics, and trends. This is not TMI, no. Your team should know your market share and if the industry is on the rise. Sales Ops must advise the front liners if the global crisis is affecting the purchasing trends so your company leadership can timely regroup accordingly.
- Make sure competition and mentorship are in place within your team. Competition is the driver. Incentive plans should be public. The sales team should have team goals and individual ones. Top sellers should be up on the wall.
- Healthy competitiveness is the fuel of a proper sales team. Make sure to use your best understanding of the team’s dynamics not to hurt anyone, but using team members’ sales results in comparison is perfectly fine in the sales universe. Saying “bye” to the weakest performers is a natural business process, that should be performed regularly.
- Track your items sold, pricing, turnover, and margins. Any of those could be a problem. A well-designed sales analytical process will alarm a business owner about the items, that bring loss, items, that are under or overpriced, and items, that need better stocking.
On the large scale of things, sales data analysis reports can help your business thrive and consistently exceed your competitors with properly designed monitoring, analysis, and actioning practices in place.
Contrarily, if done improperly or left without scrutiny and unactioned, such data will lead to the early demise of your business.
Key Metrics of Sales Analytics
What needs monitoring in sales? What data points are the ones to prioritize?
The ocean of data is a great way to drown your efficiency in. How do you know what metrics need your attention to optimize the business and increase revenues?
But before we proceed with perfect KPIs to keep track of for all who are wondering how to prepare sales analysis report, let’s highlight one important axiom:
ALL REPORTING SHOULD BE STUDIED RELATIVE TO PAST, PRESENT, AND FUTURE.
Sorry for shouting, just wanted to make sure we are on the same page here. It is a prerequisite that the more data you have, the easier it is to draw flawless conclusions and create roadmaps to success based on it.
The past data shows trends and results of the applied measures, deviations of the market based on crises and seasonality, the reaction of the clients to price increases, and more. It’s your crystal ball, in fact. If you plan to do something major in your sales, check if this has been part of your history and see how it worked out.
The present is the status quo of your company’s sales is where you are with all the market knowledge and the team you have now. This is your starting point always.
However deep in the negative, you are now, there is a way out.
On the contrary, however high you climbed up in your margins, falling out in the red is always an option due to a litany of reasons. Keep your eyes peeled to spot the danger before it’s too late.
The future is where you are the king. Sales forecasts and unrealistic budgets are often a way to keep top management away from their big bonuses yet working 24/7.
Keeping realistic forecasts helps for better planning practices and a sustainable business model though. Keeping your forecast accuracy as high as possible is your ideal way forward.
KPIs and Metrics
Now let’s review the data points we need to keep in focus to keep your business competitive and kicking some butts on the market.
Product sales or product performance
- unit price
- net margin
- quantity sold
- net profit
Based on this data, businesses can regularly perform an ABC analysis to review the inventory and exclude the items detrimental to the bottom-line.
Sales Growth or Sales Dynamics
Calculating the absolute figures and percent are both useful per period, depending on the scale of business.
Lead conversion rate
Low lead conversions at specific stages of a customer journey or disturbing valleys in the funnel may alert a team of sales ops, marketing, and sales to review the processes, content, and/or pricing.
Sales target or departmental KPIs
Ascertaining targets for your sales team is one of the major missions of sales operations and company management. The sales target can be established in the number of client calls, visits, deals won, revenue per deal, items sold, average deal check, customer retention rates, and so on. Picking the right mix of individual and team incentives is vital for any industry trendsetters.
This sales analysis metric allows focusing on the efficiency of your sales agents to convert leads to quote and understand reasons why the process is above/below/in line with market average or deviates from a sales rep to sales rep.
Measuring productivity of your team from the quotation to winning of the deal allows us to spot pricing deficiencies (whether too expensive or too cheap) as well as pinpoint and address other possible failures of the sales processes.
Sales by area/segment
Whatever sales metric you are looking at – be it a revenue made, margins, or items sold, one of the granular ways of looking at it is by the region. Sales may vary in different locations for a myriad of reasons and discovering why may lead to increased efficiencies in other states.
Average check AKA average purchase value
Amazon reported that upselling and cross-selling are responsible for a whopping 35% of its revenues. Average check seems all of a sudden like even more important numbers, right?
Sales Analysis Methods & Techniques for improved efficiencies
Too much is written on the importance of close collaboration of the marketing and sales team and how beneficial such unity is for a company’s bottom line, so we are keeping it short.
Marketing research and flow of information should be embedded into the daily routine of sales ops and be trickled down to every sales rep in a form of summary. Newcomers to the market, big industry M&As, pandemics, and other macro and micro-economic fluctuations may all affect your business unit. Warned means armed.
Sales performance analysis
Always make sure your targets are achievable and aligned with your overall mission and investments. Then make sure you bring your sales team leadership to pay close attention to how far away you are from reaching your monthly / quarterly / annual forecasts and budgets.
Sales trend analysis
Past trends help find cures for the present issues and engineer the most efficient roadmap to future successes.
Make sure your report has both absolute deviations and percentage-defined ones for the best perspective.
Sales pipeline analysis
Forecasting is vital for many processes, some industries more than others (like eCommerce, for example).
You base manning, purchasing, delivery, logistics, cash flow based on your forecasting. All of these business segments can be tight as a drum or all over the place, jeopardizing your company’s bottom line.
Sales effectiveness analytics
A good sales department leader is married to reporting, taking it to bed once too often. Having access to a dashboard with an overview of your sales members’ activities is paramount.
Sales-centered CRMs like Nimble offer a comprehensive overview of multiple parameters of your sales ops and sales team in a customizable dashboard. Monitor calls made, emails received and replied, the deals closed, and more in a visual graph that is easy to read and action.
How To Create A Sales Analysis Report That Actually Drives Sales
Ascertain The Data Points That Need Tracking
If you are a small business with three sales reps and 50 items in stock, you will need a more user-friendly basic overview of the data, that focuses on growth and profitability margins. Bigger companies may use sophisticated tools and a skilled sales ops team that know how to analyze sales data based on hundreds of data points.
Establish The Regularity Of Sales Analysis
Likewise, estimate the needs of your particular business to find the perfect revision and creation of reports for optimal productivity increase.
Feed and Graph the Data
Design a report or use a ready-made template to feed your figures into for best visual representation, that highlights dips and peaks, and helps to spot the trends.
Analyze Your Results
Hire an experienced sales operations manager as quickly as you can afford one, If you have 5 sales reps on your team, it’s time to start hiring a sales rep to optimize the process and boost sales department productivity.
How To Write A Comprehensive Sales Report To Your Boss
- First of all, read all of the information on the 1st Google page results to the inquiry “how to write a sales analysis report”. Knowing theory never hurts the results.
- Then download a few sales analysis report samples, unless your organization has an established sales report template. See which one you like most and have the info your boss is interested in.
- Fill in the data fields and check if it makes sense and all formulas are working.
- Accompany figures with notes as you interpret them.
- Pick up the highest variables and the lowest ones. Are they always the leader and the loser of your segmentation? Has it changed? Why?
- See the biggest deviations year to year or period to period in percentage. Explain the jumps and the dives. What can you do to address those highs and lows? Keep improving the good results and minimizing the damage from the bad ones.
- Estimate how far or close you are to your targets. Why are you so spot on or so far off? Can you doctor the situation going forward? How?
- Mark any big changes in the market or global aspects that impacted your performance for future reporting. If there was a big conference in the city, that changed patterns or maybe, like this year, a global pandemic changed the economic world over? Explain it in your reports so that next year or decade you can refer to this data.
Providing a monthly sales analysis report is a good practice when it comes to informing your senior management.
The sales leadership should be getting a daily overview of the dashboard and more extensive weekly sales analysis reports. Such a report distribution schedule allows them to address any potential risks timely or direct efforts and funds to just forming winning streaks and trends.
Sales Analysis Report Examples
There exist hundreds of sales analysis report examples created by professionals to aid small and medium businesses run their administrative units more efficiently.
There are paid sales analysis templates and those that are free. Make sure you request Google for a free report if you are looking for one and your company is not ready to pay for intellectual property.
The great news is that there are many websites out there providing such information that generate revenues by running Google ads on their websites and basically giving away those sheets for free.
Spreadsheets vs CRM solutions for sales reporting
A viable alternative to using spreadsheet-based reporting for small and medium businesses is using a CRM software – customer relations management system, like Nimble.
Nimble is one of the best CRMs for small businesses due to its intuitive interface, the low subscription fee for users [$19-$25 depending on the plan], and all-encompassing functionality that drives growth.