Shanu Singh Guliani

Closing Ratios…Are You Measuring Them Effectively?
March 5, 2008

We all know it’s easier to sell to the people coming in the door than spending more money to bring new ones in. My parents were lucky and never really had to advertise. Their store has been in the same mall for the last 16years and their clientele has been acquired by all the walk-in traffic the mall receives.

In Charlotte, my store is located in a Lifestyle Plaza (meaning it is pedestrian friendly, has a small park, swings for children, and many of the same shops a local mall would have—Banana Republic, Victoria’s Secret, Ann Taylor, etc). The store gets quite a bit of walk-in traffic yet we (the store as a whole) isn’t closing enough of the customer’s that walk through our door. I sat down with my staff and really talked about closing ratios. If we have 10 people walk through the door and are only closing 3 out of the 10 our closing ratio is 30%. But if we are closing just one or two more people that puts us in the 40-50% bracket. That is huge.

First, I realized I needed to accurately figure out how many people are walking through the door. I considered a door counter—which would count the people who enter and exit the store, but then I realized what about the UPS guy, FedEx, my own employees who leave for lunch and then come back. I hate having my number so skewed. After searching a while—I realized my Point of Sale System had something we could use.

Each time a customer comes through the door—if they don’t purchase we still ask them for their name and some information. In the customer maintenance screen a table allows for the salesperson initials, the date they came in, the item or items they were showing them, and if it was a opportunity, a missed opportunity or a sold item. From this I can pull up spreadsheets on each individual’s salespersons closing ratios.

Are you measuring closing ratios? Has measuring them helped to increase individual employee’s sales?

Posted by Shanu Singh Guliani on March 5, 2008 | Comments (0)