The sales volume variance formula helps you predict and calculate the negative or positive impact of selling fewer or greater units than you anticipated. Your sales volume alone won’t indicate much in the way of revenue or net sales. But sales volume can still inform a large number of sales decisions for your team. It’s a great tool to help you understand your sales metrics in regards to customer preference, inform your sales data, and assist in sales forecasting.
- As a result, you need to know exactly what makes your product stand out from the competition so that your marketing materials can focus on those qualities.
- Hard sales isn’t always the answer, but there are ways to speed up the customer journey through the sales cycle.
- Check out this post for top-notch sales qualification questions.
On its own, sales volume doesn’t break down how much revenue your company brings in from product sales. However, understanding your sales volume can tell you what products are and aren’t selling, which is valuable information for business growth. An increase in the volume indicates that a business is gaining market share, reaching new customers, or successfully promoting its products and services.
Identify and focus on your top buyers
From a sales volume point of view, Product A had a higher success rate amongst customers and benefited more in marketing than Product B, which means it should be pushed further. One of the best ways to increase sales volume is by creating packages. For example, if you create a package with one main product and a few complimentary products, customers will be interested in buying them. Rather than confusing the leads with too many options, offer personalized packages to maximize sales volume.
- Shorten your demos or trials, set up a one-step check-out system, cut through customer objections by heightening social selling, and invest your efforts in the methods with the best results.
- Now that you know your sales volume, how can you tell if you’re underperforming?
- For example, the sales volume of a consulting firm may be considered the total number of hours billed in a month.
- As the retail landscape continues to evolve, it’s more important than ever to stay on top of the latest trends and challenges.
- If so, how can you encourage your prospects to purchase even during the off-season?
This can be a difficult concept to employ when there are many different products, and especially when each product has a different contribution margin. But sales volume analysis on the same products paints a different picture. Taking money out of the equation, 700 units of Product A were sold and 300 units of Product B were sold.
Make your customers’ needs your top priority
You’ve also planned to track certain KPIs to track the business performance. However, the traditional ways of print media marketing or even phone sales can still be just as effective, even in 2022. Sales volume doesn’t just tell you what’s working best, it also helps you identify your shortcomings. For example, suppose you’re deciding how to allocate your budget and you see a pattern of insufficient sales in a certain region or demographic.
Do you have any idea what their expectations are from your products? Remember that 36% of customers are looking for personalization from their purchase experience. As an example, you may need a lead generation tool to find consumers that will find your products to be of value. Using a software platform such as Recon Insight’s Ri360 can also allow you to see which clients may need your products soon, making it possible for your business to have an active delivery schedule. Let’s say that you want to measure your notebook sales every month.
Learn and use effective tools to improve your overall performance
Sales managers should analyze their performances and suggest improvement strategies. Education, understanding, and appreciation is a better strategy than pressurizing the reps. The concept of sales volume doesn’t focus on the financial gains from a product. While estimating financial gain is essential, an insight into sales volume can help you identify business health to a large extent. The unit formula is simple in that all it requires is multiplying the number of units by the time period (e.g. 1 month, 1 quarter, 1 year, and so forth). For example, if you work for a supplement company that sells 1,000 units of multivitamins during Q2, your sales volume of multivitamins for that period would be 1,000.
It’s important to note that this does not take pricing into account. Just because cupcakes accounted for 26.7 percent of units sold does not mean they accounted for 26.7 percent of revenue generated. That said, this percentage is extremely useful when evaluating customer trends and planning for the future. When you think of measuring your company’s success, what markers come to mind?
Give rewards to your existing customers
Evidently, there’s a lot at stake when it comes to these high-value prospects, and you cannot risk losing them. So, it’s always a smart idea to assign experienced and top-performing reps to those prospects. Always remember that increasing your sales doesn’t always happen overnight. Being a business owner or a sales rep requires patience, skill, and consistency to know which pattern and techniques work best for your industry.