When analyzing data for sales and business performance, several key performance indicators (KPIs) are typically used. Below are some common KPIs along with their formulas in Excel:
- Total Sales (Revenue)
– Formula : `=SUM(SalesColumn)`
– Explanation : This KPI calculates the total revenue generated over a specific period.
- Sales Growth Rate
– Formula : `=((CurrentPeriodSales – PreviousPeriodSales) / PreviousPeriodSales) 100`
– Explanation : This KPI measures the percentage increase or decrease in sales compared to the previous period.
- Gross Profit Margin
– Formula : `=((TotalSales – CostOfGoodsSold) / TotalSales) 100`
– Explanation : This KPI calculates the percentage of revenue that exceeds the cost of goods sold (COGS).
- Net Profit Margin
– Formula : `=(NetProfit / TotalSales) 100`
– Explanation : This KPI calculates the percentage of profit earned from total sales, after all expenses have been deducted.
- Average Order Value (AOV)
– Formula : `=TotalSales / NumberOfOrders`
– Explanation : This KPI measures the average revenue generated per order.
- Customer Lifetime Value (CLTV)
– Formula : `=AverageOrderValue PurchaseFrequency CustomerLifespan`
– Explanation : This KPI estimates the total revenue expected from a customer over the course of their relationship with the business.
- Customer Acquisition Cost (CAC)
– Formula : `=TotalMarketingExpenses / NumberOfNewCustomers`
– Explanation : This KPI calculates the cost of acquiring a new customer.
- Conversion Rate
– Formula : `=(NumberOfConversions / NumberOfVisitors) 100`
– Explanation : This KPI measures the percentage of visitors who complete a desired action (e.g., making a purchase).
- Churn Rate
– Formula : `=(LostCustomers / TotalCustomersAtStart) 100`
– Explanation : This KPI measures the percentage of customers who stop using your product or service during a certain time frame.
- Return on Investment (ROI)
– Formula : `=((TotalSales – TotalExpenses) / TotalExpenses) 100`
– Explanation : This KPI calculates the percentage of return on investment, showing the profitability of investments made.
- Inventory Turnover Ratio
– Formula : `=CostOfGoodsSold / AverageInventory`
– Explanation : This KPI measures how often inventory is sold and replaced over a specific period.
- Days Sales Outstanding (DSO)
– Formula : `=(AccountsReceivable / TotalSales) NumberOfDays`
– Explanation : This KPI calculates the average number of days it takes for a company to collect payment after a sale has been made.
- Lead-to-Opportunity Ratio
– Formula : `=(NumberOfOpportunities / NumberOfLeads) 100`
– Explanation : This KPI measures the percentage of leads that turn into opportunities.
- Opportunity-to-Win Ratio
– Formula : `=(NumberOfWins / NumberOfOpportunities) 100`
– Explanation : This KPI measures the percentage of opportunities that turn into actual sales.
- Repeat Purchase Rate
– Formula : `=(NumberOfRepeatCustomers / TotalNumberOfCustomers) 100`
– Explanation : This KPI measures the percentage of customers who make more than one purchase.
By utilizing these KPIs and formulas in Excel, you can effectively analyze sales and business performance data to gain insights and make data-driven decisions.
