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How to Calculate Sales Leads to Close Ratio

The sales leads to close ratio is a key measure of a salesperson's efficiency. This ratio measures the percentage of sales leads that the salesperson converts to actual sales. While it can be misleading to rely exclusively on a single figure, you should keep a close eye on your closing ratio at all times.

Step 1

Count the number of sales leads over the period for which you wish to calculate your sales leads to close ratio. There is not a single universal definition of a sales lead. Broadly, a sales lead is a potential buyer who has expressed some interest in your product or service. What qualifies as showing interest depends on what you sell. If you are selling a relatively cheap product that customers often purchase on the spot, each sales presentation you make can count as a sales lead. If you mail brochures or catalogs, each person who writes back asking for a price quote can be considered a sales lead. What matters is that you settle on a definition and stick to it. If you change the definition of a sales lead, past and future figures will no longer be comparable.

Step 2

Count the number of successfully closed sales during the same time period. Again, the definition of a closed sale will depend on the situation. While you can elect to consider even the smallest possible sale a close, you can also set a minimum dollar amount that the sale must exceed to qualify as a close. If your firm sells everything ranging from industrial Laundromats costing $20,000 to refills for detergents that cost $20, it would make sense not to count a mere refill as a sale. Once again, keep the definition consistent over time.

Step 3

Divide the number of successful sales by the number of leads and multiply the outcome by 100. The result is your closing ratio expressed as a percent. If, for example, you had 50 sales leads and 10 closed sales, the ratio is 10 divided by 50 multiplied by 100, which equals 20 percent. This means that out of every 100 sales leads, you convert 20 into sales. You also need to consider other parameters in addition to the sales leads to close ratio, such as how much money you invest into each sales lead -- including travel, the price you pay for samples, labor costs and the profitability of the average sale. Still, an increasing close ratio over time is a good sign and often shows that you are on the right track.

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