Sales Goals: How to measure and compare current or past sales

Sales Goals

The Sales Target KPI measures current sales revenue and compares it to a target or past performance. The sales target can be set as a monetary value, the number of units sold, or a number of accounts. 

Reaching sales goals is always an achievement. But for this to be possible, it is essential to establish relevant and, by definition, achievable objectives.

Let’s learn more about this sales KPI, its characteristics and how to track it.

Also read: Sales report: What is it, its advantages, uses and how to create it

Sales target definition

A sales objective refers to the goal to be achieved, and the figures to be achieved in a given period of time.

The sales target is decided based on the sales budget that the company decides. The sales target can be decided by management or by individual teams and is spread accordingly. It is achieved to generate income and increase the sale of the company’s products.

Tracking sales performance against targets is a core tenet of any sales management strategy and is critical to creating a data-driven culture.

One of the keys to setting a sales goal is to make sure that it is visible to the entire team, whether it is executives, sales directors, managers or sales representatives who are the ones who use this kind of sales indicators the most.

Learn about other indicators to measure the performance of sellers.

Importance of the sales target

Designing an effective sales target can have a big impact. Here are more reasons to track your sales:

  • It provides a clear and measurable numerical picture for teams to reach their numbers.
  • It also helps the management to plan the strategies to reach the sales figures.
  • It acts as a guide for the sales team and provides a direction to move forward.
  • The objective serves as a basis for comparing and quantifying achievements

Also read: How to calculate sales estimates?

How to calculate sales goals

Ideally, set precise but challenging sales goals. It is about taking into consideration the objectives of the company, the previous results and the performance of each of the sellers. Setting sales goals and hitting them can have a huge impact on your team and motivate reps to dig deeper to close more deals.

There are a number of factors to consider when setting sales goals, and take into account specific goals such as whether to increase new business, expand existing accounts, or work with previous clients. 

In addition, sales goals should influence the incentive structure for the team, such as the commission and compensation model. 

The formula for measuring sales goals

(Current period sales/target sales)x100

How to Monitor Sales Performance Against Goals

Achieving sales goals requires active follow-up throughout the day, week, and month. Goals must be dynamic and focus on short-term performance. The more individual reps can see and understand how their work contributes to the goal, the more motivated they will be to achieve those goals.

One of the best ways to monitor sales performance against goals is to use a sales CMS and show it to everyone on one monitor. 

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