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So if your team drove $2 million in revenue over the last quarter and the costs of those sales totaled $1 million, you’d have a sales efficiency ratio of 2.
Sales revenue is easy to understand. But the costs of making a sale can be nebulous. Essentially, this is any expense (direct or indirect) your team incurs during the sales process. This includes:
Employee costs (salary, benefits, insurance, etc.)
Overheads (rent, energy, etc.)
Sales software
Employee training
You can calculate the efficiency of a single sales rep or an entire sales team. And you can calculate sales efficiency over any period. Typically, this would be a quarter or a year, but there’s no reason you can’t calculate the sales efficiency of your team from one month to the next if you have a short sales cycle.
