The importance of measuring the management of a showroom

consigli-di-marketing marketing-tips

In order to improve the quality of marketing activities one must measure it. Even showroom management can be measured.

The showroom of a door and window manufacturer nowadays must count on propositional actions and not just provide answers to potential clients visiting it. The showroom is a “tool” for producing sales. This is why its efficiency must be verified via the use of result indicators.

Even if the company does not have a management control system and does not operate based on a budget, the entrepreneur must have a clear objective, in terms of sales volumes, that is to be reached in order to obtain a positive result, i.e. profit, at the end of the business year.

The result (efficiency) indicators of a showroom are the following:

  • ratio between orders and quotations (i.e. what percentage of quotations turns into orders);
  • ratio between quotations and contacts (i.e. what is the incidence of quotations on visits to the showroom).

The quotations/contacts ratio is affected by the ease with which one ‘gives out’ a quotation. This is an important marketing tool for the company, but it has a cost. The quotation must be made only then there is real interest on the part of the potential client. This can be verified via the sales pitch that the person running the showroom (namely the internal salesperson) must always make.

It may happen, sometimes, that the quotation is drafted for the ‘wrong’ client, namely for a client that does not match the identikit of the ideal client for the company. It is possible to achieve the identification of the ideal client, the client that more than others appreciates the company’s product-service offer, by studying the clients who have purchased the company’s doors and windows.

The ratio of orders to quotations is linked to the quality of the quotation and of the sales pitch that preceded it. Some companies provide their sales staff with a guide for talking to the client and for drafting a quotation that is truly tailor made for that client.

The quotation must not be limited to listing the prices of the products. Indeed, it must enhance their value, i.e. what they are worth. Nowadays, clients want doors and windows that provide good value for their money and that meet their specific requirements.

Your quotation – almost always read by the clients and compared to those of others in the peacefulness of their home – must create a positive difference compared to other quotations. This is why it must be prepared carefully and accurately.

A correct value of orders to quotations falls within the 0.45 to 0.65 range. Any value below the lower limit value means that too many ‘easy’ quotations are being made, or quotations that only indicate costs without underscoring the quality of the products.

A value above 0.65 perhaps occurs when there is the hesitance to make quotations, as if they were prepared only near or on completion of the sale. This way, sales can be lost, thereby damaging the company.

Finally, let us suppose that the ratio of quotations to contacts amounts to 0.5. In this case, one could say that in order to obtain one order at least 3 to 4 clients must be enticed to enter the showroom.

 

Showroom result indicators

 

Orders/quotations ratio = number of orders / number of quotations

Indicates the likelihood that a quotation will transform into an order. All other conditions being equal, it depends on the quality of the quotation and of the sales pitch that preceded it.

 

Quotations/contacts ratio = number of quotations / number of visitors

Affected by the percentage of visitors truly interested in purchasing and not just ‘curious’ or simply in search of information. It also depends on the ease of providing a quotation without investigating the actual interest to buy.

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