In business school, I was recommended a book called Go for No! Yes is the Destination, No is How You Get There by Richard Fenton. It's an imaginary short story that shows how salespeople often focus on their successes but ignore the rejections. In sales, getting no is a necessary step to getting yes. In fact, most salespeople have to go through many noes before getting a single yes. It’s exciting and natural for salespeople to track dollars of closed deals, but they rarely pay attention to how many deals are rejected to get to the closed dollars, why many deals are rejected, at what stages the deals are rejected, who rejected them, or how long it has taken them to receive a rejection. 

You can't improve your sales process if you don't know how your successes and failures are quantified in numbers. The most impactful thing to do to improve sales is to keep careful track of sales metrics, but this is time-consuming, boring, and doesn't add to a salesperson's commission right away. Salespeople would rather spend time chasing the next prospect than analyzing how many deals were rejected. 

The lack of detailed reporting of sales numbers is particularly common for startups where there is no standard reporting. During market validation, a startup's products can change a lot; standard procedures and even business models can quickly become out of date. More importantly, past sales metrics, such as those from pilot projects or freebies, may not be indicative of future sales in a constantly evolving situation, so why do sales leaders bother tracking them?

In fact, I would argue that because products and business models can change quickly in startups, sales metrics are a goldmine of information that can help startups figure out how changes to their products and business models affect how the market reacts. Below are a few typical sales metrics your startup should track:

• Conversion rate and time spent

• from contacts to introductory meetings 

• from introductory meetings to formal presentations

• from formal presentations to proposals. 

• from proposals to closing

• Descriptive metrics of closed and terminated deals

• contract size

• strategic importance and intangible value

• profit margin

• likelihood of renewing 

• upselling opportunities

With these metrics, startups can more precisely analyze where optimization needs to be. For example, if the conversation rate and time spent from contacts to introductory meetings are abysmal, there might be something wrong with the messaging, the targeted personas, or the product value proposition. If moving deals from proposals to closing is an issue, we should probably look into internal decision-maker mapping, pricing strategies, or negotiation strategies. 

Another critical but uncomfortable use of sales numbers is to confront us with an honest performance review when things don’t go as well as planned. In many startups, there is usually a narrative to fill for the employees or a target to meet for investors. While we understand the importance of storytelling, particularly in startups, sales leaders should still take a level-headed approach to honestly analyzing the sales metrics.

When sales fall short, avoiding the uncomfortable truth or spending more time chasing the next deal is actually not the most productive thing to do, although they are spontaneous reactions. This is when sales metrics are particularly useful in pinpointing the areas that need more attention to turn around. However, for many companies, when they start to realize that they need the sales numbers to troubleshoot what went wrong, the numbers are never collected. It’s never too late to collect your sales numbers today.

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