Question

Identify five different sales organization productivity ratios that you would recommend. Describe how each would be calculated and what information each would provide (show mathematically for each of the 5)

Answer 1

There are five different sales organization productivity ratios that can be recommended. They are: sales per salesperson, sales per unit of inventory, sales per customer visit, sales per marketing expense, and sales growth rate.

Step-by-step explanation:

When measuring sales organization productivity, there are several ratios that can be used. Here are five different ratios that can provide valuable information:

1. Sales per salesperson: This ratio calculates the average number of sales made by each salesperson. To calculate, divide the total number of sales by the number of salespersons.
2. Sales per unit of inventory: This ratio measures the efficiency of sales by dividing the total sales by the average inventory level. It shows how effectively the inventory is being utilized.
3. Sales per customer visit: This ratio measures the success of sales in terms of customer visits. Divide the total sales by the number of customer visits to calculate.
4. Sales per marketing expense: This ratio evaluates the effectiveness of marketing efforts by dividing the total sales by the marketing expenses incurred.
5. Sales growth rate: This ratio shows the percentage increase or decrease in sales over a specific period. To calculate, divide the difference in sales by the original sales and multiply by 100.

These ratios provide valuable insights into a sales organization's productivity and can help identify areas for improvement or measure success.