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Direct Sales Success: Know Your Averages

In baseball, one of the key metrics used to determine a player’s ability is their batting average.

The league leaders have an average around .350, which means for every 10 times at the plate, they hit the ball and get on base 3.5 times. Sixty-five times out of a hundred, they don’t make it to first base.

And those are the league leaders!

Pitchers have a comparable measurement – the Earned Run Average (ERA). This statistic measures the number of runs in a game that are “credited” to the pitcher. In essence, these are the runs he gave up as a pitcher. The lower the number, the better the pitcher.

The league leaders fall in the 2.1-3.5 range. That means that even the best pitchers are giving up a few runs each time they take the field.

What about you? In the game (and business) of direct sales, you need to be tracking your own averages. In fact, there are 3 critical averages that you must track if you want to improve your business on a consistent basis – regardless of the economy. They are:

1. Your Show Sales Average (SSA). This metric tells you exactly what you can expect from every show you do. If you know that you’re averaging about $350 in sales at each show you do, you can predict with a fair amount of certainty how much income you’ll earn in a given month. You’ll also be able to strategize ways to improve your show income. If you don’t know your SSA, however, you’ll always be guessing from one month to the next about how your income will look.

The SSA is an easy number to calculate. Take the total show sales you’ve had in a given period of time (a year is best) and divide it by the total number of shows you held to get those sales. Don’t count individual sales or online income unless they are part of a show you can track. Just sales from shows and the total number of shows. If fifteen shows resulted in $15,000, you have a $1,000 show average. If fifteen shows resulted in $1500, you have a $100 show average. Your results will likely fall somewhere in the middle of hose two extremes. If you don’t do shows, calculate your one-on-one’s. Same math, different figures.

2. Your Bookings Per Show (BPS). This metric indicates the longevity of your business. If you consistently get 2-3 bookings per show, you have a healthy business that will continue to propagate itself with new parties. If you consistently book 1-2 parties per show, you’re going to have a more difficult time keeping your calendar full. When you know this metric, you can start to take a look at the reasons for your booking success (or challenges). Sometimes, it’s a matter of changing your verbiage at the party. Sometimes you realize you haven’t been giving a booking talk at all. Sometimes, you hit on just the right combination of fun and education that gets people excited to want to book a show with you.

You can calculate your BPS almot as simply as your SSA. Simply add up the total number of bookings you’ve gotten in the past year (or 6 months), and divide by the number of shows from which they came. You are counting totals, not JUST the shows that held. Be honest with yourself. If you booked 10 shows and only 4 held, that’s a different metric. We want to track the total number of bookings from each show.

This does bring up an interesting discovery. If you find you’re booking a lot of shows but they aren’t holding, chances are good there’s a problem with hostess coaching or follow up. Or you’re working with flaky people. Both problems can be easily solved with a little coaching. But you can’t solve either problem if you don’t know your BPS.

3. Your Recruiting Interview Percentage (RIP). This metric tells you how many recruits youll be adding to your team. This metric is a little more complex, because it’s actually made up of TWO mathematical equations. First, you need the total number of guests/clients you’ve worked with in a given period of time. This can be a challenge, so when you first start tracking this metric, begin with the total number of guests at your shows. Over time you’ll need to add in all the other people you share recruiting info with, but for now, stick with something a little easier to track. How many recruiting interviews are you scheduling from each show? Divide the number of recruiting appointments by the number of guests. This is your scheduling rate. Save that number for the next step.

Now look at your recruiting appointments. How many of them actually result in a new consultant joining the team? Take the scheduling rate from step one and divide it by this number. Now you have a percentage you can work with. For every hundred people you meet, that’s the number of people that will likely join your team on average.

Let’s look at an example. If you have 150 guests in a given month, and schedule 10 recruit interviews, you have a 6.6% scheduling rate. Of those 10 interviews, only 3 join the team. That means you have a 2.2% Recruiting Interview Percentage. For every 100 people you meet at shows, etc, 2.2 of them are likely to join your team.

Once you know these numbers, you can begin to see how easy it is to stay motivated. If you knew with a fair amount of certainty that you could turn 2 out of every 100 people into new recruits, you’re much more likely to approach those 100 people in the first place. You’re also much more inspired to want to IMPROVE that percentage so that you’re not working quite as hard from the get-go.

When you keep close tabs on what I call “the BIG 3” in your business, you’ll have a more consistent, stable income, with the power and ability to keep it growing, right at your fingertips.

© 2010 Lisa Robbin Young.

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If you’re interested in hearing more about the BIG 3, I will be chatting with Carrie Wilkerson on this topic during her Barefoot Bootcamp 2.0 happening this month. Yes, that’s my affiliate link, but the videos are free, and very informative. I hope you’ll check it out. Plus, if you sign up through my link for the event, you’ll also get free access to my OWN Direct Sales Super Summit coming up in March!

USE THIS ARTICLE FOR FREE IN PRINT OR ONLINE!

Please do not alter it and include the following information (with active links as appropriate):
Lisa Robbin Young is a certified direct sales marketing coach, teaching direct sellers to grow their business like a real business instead of an expensive hobby. Sign up for her free weekly ezine at http://www.homepartysolution.com/

2 Comments

  1. Merilyn Strange

    Lisa,
    Love all the information you post, wonderful emails and newsletters you send out. Thanks for all you do for direct sellers!
    Merilyn Strange

  2. Deb Bixler

    Hi Lisa,
    Excellent article. I am sure most DSellers track their show average and may miss the other two. One other thing that is good to track is your ratio of yes to no. I always say 1:10 will say yes. Ask ten to get one yes. When this is tracked it makes you feel bettter to see that you truly are not asking "everyone" and that you are getting results. You made some good points! When you track something you can improve it. If you do not know where you are you can not get better. Thanks for being a consistent force with valuable content to the DS the industry! Deb

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