Measuring Marketing

Chapter 105 Sales Productivity

Measurement Need

Sales management needs to know how productive its salespeople are.

Solutioni

Productivity can be measured in the following ways:

–Sales (revenues) per person (measured in dollars)

–Profits per person (measured in dollars)

–Volume sold per person (in units)

Most sales productivity measures focus on revenues per person.

$SP=\frac{{\displaystyle \sum S_t}}{{\displaystyle \sum S_p}}$

Where

SP = sales productivity

ΣSt = sum of total sales for all sales people

ΣSp = total number of sales people

Assume a company sells real estate data and software to title companies, real estate firms, appraisers, and financial institutions. The company’s revenues are $11 million, generated by seventy-five salespeople. Sales productivity was as ...