I started my lawn and pest prevention company nearly seven years ago only after traveling the country connecting and visiting with other lawn care company owners. I wanted to learn how to build an effective business model supported by a great sales team.
Discussions with successful owners convinced me that to build a successful sales department, I needed to set realistic sales goals that are driven by and tracked with key performance indicators (KPIs). Establishing these indicators would allow my entire team to understand our sales expectations weekly, monthly and annually.
I am happy to report using KPIs is working for us, and this strategy can work for you, too.
What are KPIs?
I liken KPIs to the instrumentation in the cockpit of an airplane. Although a pilot can technically fly a plane without gauges, it is obviously not recommended. The same holds true for a sales department and your sales manager. The sales manager needs “gauges” (KPIs) to maintain control of the volume and quality of what is being sold. This knowledge is crucial to the long-term success of any business.
As a company grows and gets larger, you will need written standards rather than relying on “gut instinct.” Yes, you can start a business and run it to a relatively small size without written standards, but as your business grows you will definitely need written KPIs pegged to benchmarks. This is especially true when it comes to sales. Maintaining KPIs will allow your sales organization to grow and scale in size.
Consider the simple chart (right) with a list of recommended KPIs and standards for your residential lawn care sales department. Customize it to fit the needs of your sales department depending on the types of services you sell. I also highly recommend posting the name of your sales people and their KPIs (actual versus goal) on a board or computer monitor within the sales department so information is transparent and everyone has access to it.
The more detailed you make your sales KPIs, the easier it is to manage and scale your sales.
KPIs enable clear data
KPIs allow you to better train and coach sales representatives because they clearly show where sales people are succeeding and failing.
For example, if one of your sales representatives is not achieving their goals for the week, you can dig deeper and identify the root cause. Perhaps a sales person is not making enough outbound calls or generating enough sales leads. When you have data to validate this you avoid managing based on emotion rather than on facts.
Alternately, if a sales person is hitting or exceeding their goals, the KPIs provide you an opportunity to reward this behavior and share with the rest of your team why this individual is successful.
One of the most discouraging (and dangerous) challenges faced by almost all rapidly growing companies is unprofitable growth. Things can get out of hand and start falling through the cracks of companies that are growing without clearly defined sales KPIs that track all new incoming sales and monitor the value of these sales per customer.
The key to building a stable and sustainable company is to grow profitably. Implementing and adhering to KPIs help you achieve this because they alert you to not only sales volume, but also sales quality.
And, yes, sales quality is very important. After all, anyone can sell large volumes of units when they are heavily discounting or undercutting their pricing. This hurts not only the company but also degrades the value of the entire industry. Undercutting without proper strategy can cause a ripple effect that could eventually trickle into every area of your business. Increasing your sales solely for growth and not controlling your prices and expenses is a recipe for big problems.
Finally, realize that you will almost certainly need to revise and customize your KPIs as your company grows and you add services.