One of the most overlooked pieces in Restoration and the biggest threat to your profit margin is monitoring your average dollar sales!
Your average dollar sales tell you a lot about what is happening internally in your business. You may not have the opportunity to go out on every job so monitoring your average dollar sales help you to see trends about your company and your crews that you could miss otherwise!
We talked a few weeks ago about applying a botanical antimicrobial to EVERY water damage job. So let’s say you put this procedure into place and a few weeks down the road you have crews that are not doing this. Maybe its just because they ran out of Benefect or maybe it’s because they just don’t apply it! Having average dollar sales goals in place can instantly point out that revenue is missing!
Average dollar sales can also help you track one crew to another. What’s the average dollar sale of crew number one? What’s the average dollar sale of crew number two?
Your people in the field are the ones controlling your the average dollar sale, they are controlling what services are done.
Unlock the Keys to Setting Up Average Dollar Sales GOAL
Let’s look at some examples of the ways you generate revenue!
Please note that these number are examples only
Let’s say that you have:
100 Leads and 75% of the leads turn into Sales, then let’s say that you are averaging $2000 per sale. 75% of 100 is 75 so 75 X $2000 is $150,000 dollars. NOW, let say your profit margin is 70% that would make your profit $105,000…..NOT BAD!
Now increase your average dollar sale by just $200
100 Leads and 75% of the leads turn into Sales,then let’s say that you are averaging $2000 per sale. 75% of 100 is 75 so 75 X $2200 is $165,000 dollars. NOW, let say your profit margin is 70% that would make your profit $115,000…..that is a $10,000 dollar difference over 75 jobs!
3 Parts of putting this all together:
1. Track your average dollar sales.
It’s a known fact that anything that is tracked will improve.
2. Set average dollar sales goals.
To set up your Average Dollar Sales goal you need to make sure that the services that your require are being done by reviewing the last 20 or so scope sheets. If you are satisfied with your finding, add the scope sheets together and divide them by the number of scopes sheets you added together and that is your current average.
Now you need to look at your company goals as a whole to determine how much your average sales goal should be.
3. Bring you people together.
Bring everyone together for a brain storming session to figure out what changes can be made in order for everyone to meet the new goals that have been set!
Everyone in your organization has to be on board with average dollar sales goal and they need to know what their goals are.