By this point, you should know I relate everything back to sports; well, today is no different. Every year around late February, most division 1 college basketball programs in the United States anxiously await their fate as to whether or not they will be in the NCAA Tournament or not. If you have ever followed college basketball, you know the analysts are always talking about the last four in, first four out, and quad 1 wins and losses. All of these statistics come down to one thing, and one thing only for teams that are considered a last four in and first four out – QUALITY WINS!
If you have two teams with the same quantity of wins being considered for the last spot in the illustrious NCAA Men’s College basketball tournament, the panel that decides who gets in goes back to the quality of wins. Now, this is heavily debated as to what a quality win is, but that is for another time.
What I am getting at is, sometimes, quantity means nothing when you are the same as everyone else; rather, the quality of the quantity is what really matters.
Consider your leads.
If you have 100 leads a week coming in, and spending $2,000 per week to get those leads, what is your cost per lead? Easy math. $20 per lead. Now, let’s go to the next step.
Those same 100 leads are turning into 40 set appointments. Hey! That’s not too bad, right? Well, let’s do some math here. You spent $2,000 for those 40 appointments, which comes out to $50 per lead. Not too bad right? That’s ok…I mean you have a 60% loss rate from lead to appointment, which means you essentially spent $1,200 for someone to pick up the phone. Let’s keep going…
The typical closing percentage for salesmen in the U.S. right now is about 30% – maybe you are higher or lower, that does not matter right now. If you are closing 30% of those 40 set appointments, then you close 12 deals per week, which comes out to $167 cost per close. Not too shabby at the end of the day.
Let’s run another scenario…
You spend that same $2,000 in a week, but this time you only get 60 leads instead of 100. That is $33.33 per lead. Here is where it gets fun, though, Of those 60 leads, 50 set an appointment – that is $40 cost per lead. Then, of those 50 set appointments, you close 15 of those at a 30% close rate. I know that is only 3 extra per week, but let’s do math.
At 12 closed deals per week and averaging $15,586 per closed deal – average for a new roof in the United States – this is your revenue
- Per week – $187,032
- Per month – $748,128
- Per year – $9,725,664
Now, same thing, but with 15 closed deals per week
- Per week – $233,790
- Per month – $935,160
- Per year – $12,157,080
The difference…
- Per week – $45,758
- Per month – $183, 032
- Per year – $2,379,416
So yes, quality DOES matter over quantity when you look at the overall numbers. How do we do it? Well, you got to set an appointment with me to learn about that!
