Revenue and the Five Elements

Happy business partners looking at camera with smiles

I was invited by one of my clients to train their sales force in some aspects of sales and efficient management of their time. To focus their minds I explained that there are only five ways to increase revenue, being an increase of one or several of the following:
Leads/enquiries – the potential customers who have expressed an interest in your product and service
Conversion – the number of people who have bought compared to the number of leads/enquiries
Frequency – the number of times a sale is made in a particular period
Average sale – the dollar value of a particular sale or transaction
Price – what the customer pays for your product and service

I then asked the group which of the above they would like to increase. All identified the first four. Later I spoke to the Managing Director who informed me that there was going to be a price increase because the first four elements were not meeting target; hence my involvement.

Of course, these five input variables to generate revenue do not just apply to sales. Rather, they apply to all aspects of a business and should be constantly asked of all departments. For example, let’s take “Frequency”. This could involve production and inventory control to ensure the stock is there when required. Product design also has a part to play. It could also involve the credit department in the way that they interact with customers and not be indifferent or heavy-handed that causes the client to purchase no more. Marketing could be involved in the way the product is promoted.

CEOs would also lead by asking “In how many ways can we increase Leads and/or Conversion and/or Frequency and/or Average sale and/or Price?” for all these lead to an improved bottom line and shareholder satisfaction.
To those who are interested I have put together an Excel spreadsheet which allows you to determine what improvement you want in each of these elements and the return on your investment. It allows you to change the figures and play “What if?” Just let me know and I’ll email it to you. (
If you have any comments or questions am happy to receive them.

Need help in increasing your revenue? Contact:

Gerald Richards