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# How Sales Efficiency is Calculated

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Sales efficiency is the revenue of a sales department, team or process relative to its cost. It is a basic financial metric based on the efficiency formula that can be used to benchmark sales efforts against a competitor.

## Calculation

Sales efficiency is the ratio of gross revenue generated by a sales team as compared to the cost of the team including salaries, benefits, incentives, office space, training, software and other expenses.
Sales efficiency = (revenue / sales cost) x 100
For example, a sales team generates revenue of \$12 million at a total expense of \$2 million.
Sales efficiency = (12/2) x 100 = 600%
The sales efficiency metric can also be represented as a simple ratio without multiplying by 100 to make it a percentage. In the example above, this results in a sales efficiency of 6.

## Similar Metrics

Sales efficiency is a financial metric that is similar to revenue per salesperson. For example, a sales team with 24 employees and sales of \$12 million:
revenue per salesperson = 12,000,000/24 = \$500,000 per salesperson
It is also common to calculate revenue per employee for an entire organization.
 Overview: Sales Efficiency Type Definition The revenue of a sales department, team or process relative to its cost. Related Concepts

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Account Management
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## Sales Metrics

A list of common sales metrics.

## Attach Rate

Overview of a common marketing and sales metric.

## Sales Conversion Rate

The 3 types of sales conversion rate with examples.

## Contribution Margin Calculation

An overview of contribution margin with example calculations.

## Cost Per Lead

The formula for cost per lead with calculation examples.

## Annual Contract Value

The definition of annual contract value with calculation examples.

## Sales Goals

The common types of sales goal with examples.

## Win Rate

The definition of win rate with calculation examples for sales proposals, sales revenue and advertising bids.

## Gross Margin

An overview of gross margin with calculation examples.

## Efficiency

A list of efficiency measurements.

Common types of business efficiency.

## Process Efficiency

How to calculate the common types of process efficiency.

The common types of business benchmark.

## Red Tape

A definition of red tape with examples.

## Work Efficiency

The definition of work efficiency with examples.

## Efficiency Definition

An overview of efficiency with examples.

## Management Efficiency

The definition of management efficiency with examples.

## Economic Efficiency

The common types of economic efficiency.

## Agency Cost

The definition of agency cost with examples.
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