What is Gross profit and Net profit

Understanding Gross profit and Net profit is important for a sales leader in order to arrive at the right sales projection which ultimately forms the part of financial statements of the business. In this post, we wish to demystify the terms Gross profit and Net profit with simple explanations and examples. By the way, we have also written a similar post on Topline and Bottom-line. If you are yet to read that article, then do check it out.



Now, coming back to our original topic, 1. Gross Profit: Gross profit refers to the profit generated after deducting the cost of goods sold from the revenue from sales. Gross Profit = Revenue from Sales - Cost of Goods sold Example: Suppose your business generated a revenue of $10000 during a month, and the actual cost of the goods sold is $4000. In this case, Gross profit = $10000 - $4000 Gross profit = $6000 2. Net Profit Net profit refers to the final profit after deducting the operating expenses, interest expenses and taxes from the Gross Profit generated earlier. Net Profit = Gross Profit - (Operating expenses + Interest expenses + Taxes, etc.) Here the operating expenses can be payments made towards staff salary, rents paid towards office/building/factory/machinery, depreciation, etc. Example: Suppose the Gross profit generated in your business is $6000 and the staff salary paid for the month was $2000, Interest expenses were $500, expense due to depreciation was $200 and taxes paid were $300. In this case, Net Profit = $6000 - ($2000+ $500 + $200 + $300) Net Profit = $6000 - $3000 Net Profit = $3000 I hope this article helped you understand the differences between Gross Profit and Net profit. Let us know your thoughts…

How to motivate sales teams in startups

Being in sales, you must very well know the importance of motivation. Highly motivated sales teams tend to deliver high performance and are always self-driven without the need for a Sales Manager to oversee every small task.

But having a sales team with all time high motivation is not an easy task. Sales managers have to constantly pour in effort to keep the motivation level of the team high. This not only boosts an individual’s performance but also keeps the team morale high.




Here are some of the tips you can use to motivate your startup sales team.


1. Set challenging yet achievable goals

In sales, every term, be it a quarter or month or week, starts with goal setting where team members get their own target or quota. As a sales leader, you have to ensure the goals you set for your team are challenging yet achievable. Many sales leaders tend to keep the targets so high that it appears obvious that those are non-achievable. This ultimately leads to low-morale among the team and leads to low motivation. While if the goals are achievable, there exists a sense of feeling among the team that they can surely reach their number and celebrate their achievement.


2. Celebrate every small winning

In order to keep the team’s motivation high, the Sales leader should ensure that the team's achievement is being appreciated, be it small or big. Make it a culture to celebrate every small winning of the team. Break down the goals into small milestones and celebrate the win. Call for a small casual get together on the office floor and celebrate the milestone.


3. Bring in Gamification 

Concept of gamification works very well for teams where you want to bring in a culture of healthy competition. Introducing gamification within your sales team lets them enjoy the competition and also help in their personal career growth. In this way, instead of running behind unachievable targets, teams will at least try to improve their own game by learning how the top performers within their team are doing it.


4. Reward performers

Rewarding the best performers can be a high motivation booster for the team members. Recognising the best performers for their contribution not only boosts the morale for the performer but also creates a sense of motivation among the other fellow team members who would aspire to be in the same place during the next term of the award. However as a Sales leader you should also ensure that the criteria for rewarding the employees is logical and doesn’t favor the same person always, which may otherwise not serve the purpose of boosting the team morale.


5. Mentor your team

If there are high performers in a team, then relatively there will always be some team members who would fall into the low performers bucket compared to the average expected performance. The sales leader should take up the responsibility to mentor their team to succeed rather than to try to get rid of low-performing team members. Since no one is a born sales professional, this skill can definitely be learnt given they get good guidance and mentoring. Try to talk one-on-one with the team members, understand their challenges, give them feedback and give them appropriate time to overcome their challenges. That’s how you boost team morale and help them grow.


6. Give constructive feedback

During day to day activities, not everything you plan will go smoothly as per the expectations. There will always be some hiccups and challenges in normal business activities. If something goes wrong, take up the initiative to give constructive feedback to the team instead of finger pointing at anyone and trying to put them on the spot. Giving constructive feedback is a significant morale booster and denotes that the leader cares for the team.


7. Design motivating sales compensation structure

Though every other non-monetary effort is good, it would become worthless if the sales professional is not being compensated well for his effort. Sales professionals tend to be number driven and they apply the same math on their personal career growth in terms of compensation as well. Having a well designed sales compensation structure is essential for motivating the team. Try to have a balanced structure with base compensation and sales incentives in order to keep the motivation level of the team high.


8. Ask about their career goals and provide a fulfilling career path

As a sales leader, your goal is to build a long term relationship with your team. This necessitates that you understand their career goals and aspirations in order to provide them a fulfilling long term career path. As sales professionals are very ambitious and career driven, they would not stay for long in an organization where they cannot visualize a better future version of themselves. Hence it is important for the Sales leader to build the right culture and career path where the team can foresee a long term relationship. Motivation is directly related to the length of relationship expected. Since the rewards of long term association is high, if the team doesn’t see a long term career path, it will lead to low motivation and ultimately leading to low performance as well.


Having said that, Motivation is an ongoing need and you need to embrace the above activities as part of your ongoing organization culture in order to derive the best outcome.


By the way, one of the best ways to assess your sales team performance is using a good Sales CRM tool which lets you track your sales figures and metrics accurately. 

If you are yet to try out a Sales CRM tool for your team, do check out ToolsonCloud Sales CRM.

Must have Sales Hiring tips for Sales Managers

Being a Sales Manager in a growing and ever expanding team, one of your key responsibilities would be to ensure you hire the right folks in your team. Any wrong hire to your team can severely impact your revenue goals and also put you behind your current stage making it difficult for you to recover. In addition to that, it also impacts your overall team motivation and confidence, ultimately hampering their performance as well.

Though you cannot always ensure you hire the best, you can definitely make sure you hire the right candidate having the right attitude and hunger to succeed in sales. 



Here are some of the must have sales hiring best practices you should follow to hire the right candidates for your team.


1. Be specific and accurate while giving the Job description:

Hiring Managers sometimes tend to be lazy in writing detailed job descriptions of the position and leave it at the mercy of the recruiters. While an experienced recruiter will certainly ensure to write a correct job description based on their past experience, they may not be aware of the specific nuances of the job roles. Recruiter may post the job with generic job description applicable for the sales roles, which may lack certain descriptive information about the roles and responsibilities expected out of the candidate. 

Ultimately this leads to hiring wrong candidates who tend to know about additional things later and feel unhappy about it if the expectation doesn’t match. Hence it is important for the Hiring manager to provide specific and accurate information while giving the Job description of the position. If the job requires any specific expectations, ensure to explicitly mention it so that it attracts the right candidate and helps the recruiter close the position faster. 


2. Get involved in Sourcing efforts as well

Hiring managers who leverage their networks to hire candidates tend to get more qualified profiles than those who rely only on the efforts of the recruitment team. Share in your social media that you are hiring on the listed positions and ask for your networks to refer anyone whom they might know. Candidates who come through the referral sources tend to have lesser drop out rates and they are more likely to stay with you longer. 

Though it doesn’t guarantee 100% commitment, it does ensure both you and the candidate understand the work culture and expectations well in advance and ensure the candidate is aligned as per the expectations. This helps avoid any unexpected surprises later and ensures the work goes on smoothly.


3. Have a structured assessment process for Interviews

Very often we observe that different interviewers are sent for different interviews for the same positions based on the availability of the interviewers. In these cases, Sales Managers should ensure they have a structured evaluation process and parameters on which the candidate needs to be assessed. 

Otherwise in case if there is no structure of the interview questions and evaluation process, different interviewers may rate the candidates differently and the scores arrived may be subjective in nature. Subjective scores without any common process for all candidates can never be the right measure to compare the candidates.


4. Rely more on Future potential than on Past performance.

Many interviewers tend to be a bit biased and evaluate candidates only based on their past performance. The bias comes because of a thought process that if the candidate has done good in the past, he will do good in future and if the candidate has not done any good in the past, they cannot do any good in future as well. While this remains a valid measure in the majority of cases, exceptions do exist. 

Being successful in sales requires the right attitude, hunger to succeed as well as interest in the product they sell. If they have keen interest in what they sell, they can quickly learn and succeed irrespective of how they did in the past. Hence ensure to hire more based on the future potential of the candidates than their past performance.


I hope you loved reading these essential tips for Sales hiring. 

By the way, if you are looking for a Sales CRM software to make your Sales team more productive. Then do try out ToolsonCloud Sales CRM.


Which sales metrics should I track for my business?

If you run a business or are a Sales Leader in your organization, then you might have come across this question often.

Which Sales metrics should you track may vary depending on the line of business you operate in. Based on your industry vertical, certain sales metrics would be extremely important for you to track while the same metrics might not make any sense for someone in another industry.

Nevertheless, there are certain Sales Metrics that are Industry agnostic and can help you measure sales performance irrespective of the line of business.

Here are the top 5 sales metrics you can track in your business


Photo by RODNAE Productions from Pexels

1. Conversion Rate

This refers to the number of leads that got converted to successful deal wins. Monitoring this metric will help you to channelize your effort on the leads which have a high probability of conversion so that you can improve your revenue faster.


2. Average Sales Cycle duration

This refers to the average time it takes for your sales team to move a prospect from the opportunity creation stage to final deal closure. Monitoring this metric and aiming it to keep lower helps you to close more sales in a lesser amount of time. If you want, you can go more granular by monitoring the duration of each sales stage so that you get a flag whenever a deal is stuck in a certain stage for longer than usual.


3. Average Deal Value

This measures the average revenue you are bringing with every deal win. Over time, you should try to increase the average deal value and aim to grow the high-value accounts. This can be a powerful level you can use to pull up your revenue with the same amount of effort.


4. Topline & Bottomline Growth

These metrics help you visualize your revenue (Topline) and margin (Bottomline) growth over a period of time say monthly, quarterly or yearly. When you see the growth in numbers, it gives a clear and quantified validation of your growth.


5. Average Customer Lifetime value

This is an often ignored metric and people tend to associate it only with Saas businesses, but this is extremely important for any kind of business. Whenever you notice your average customer lifetime value is dropping then it’s a clear flag that there is something wrong with your offering which is leading to customer churn. This helps you focus on nurturing & retention efforts.


By the way,

If you liked reading this post, feel free to check out our tool at - ToolsonCloud CRM, where you can create wonderful custom sales reports and visualize your sales performance in real-time.

Moreover, it’s free.


How to drive CRM adoption in Sales teams?

You invested a lot of time as well as money trying to implement a CRM solution across your organization but it ended up as a failed project.

How does it feel? It doesn’t sound cool. Isn’t it?

But this is often the case with many organizations who are unable to derive value from their CRM implementation even after making huge investment in this regard. The biggest reason for CRM project failure is low CRM adoption among the end users of the system. If sales leaders can lead their team to adopt CRM faster, they can quickly start reaping tangible benefits out of their CRM implementation. 


Photo by Mikael Blomkvist from Pexels


Here is what you can do to drive CRM adoption within your sales team:

By the way if you are still looking for a CRM software for your sales team, do check out ToolsonCloud Sales CRM.


1. Keep team involved from the beginning

When you are implementing a CRM solution in your organization, try to involve the end users from the beginning. Listen to their challenges, ask for feedback, implement their feedback. This way you make them a stakeholder in the implementation. When you respect others’ input, they tend to associate themselves as a part of the project. They tend to own it end to end. This way you stand lesser chances of failure since the end users are going to drive it in future on their own.


2. Choose an easy to use CRM

One reason why users tend to avoid using a CRM is due to the complexity of using it. The objective of implementing a CRM is to make the lives of the sales team simpler and easier rather than making it more complex by asking them to use a hard to use CRM. Always ensure to take trial of the CRM software and test its usability and user experience before making a final purchase.


3. Provide adequate Training

If the end users are not familiar with the terminologies, various stages and workflows in a CRM, they would hardly use it to maximum potential. Always provide adequate training to your end users on the various functions of a CRM and the purpose of using it. Making people familiar with the basic controls and letting them know the purpose of using it makes it much easier for driving faster adoption.


4. Provide appropriate user guide

When you are providing training, the users may tend to forget it overtime unless and until they are actually using it. Conducting regular CRM training sessions may not be feasible for numerous reasons. Assigning a peer to help a new employee to learn the tool may not bring out consistent knowledge transfer. This problem can be solved if you have a well documented User guide. It can serve the purpose of looking up for some on-demand information or clarification which the end user may have. You may request your CRM vendor to provide the same or may also refer to the knowledge base section of the respective product page such as we have it for ToolsonCloud Sales CRM.


5. Establish easy to follow CRM processes

Often the sales team tends to think of a CRM to be a database rather than a modern tool to manage your sales process. This ideology may prevent them from updating their sales activities in real time and they will end up updating the tool once in a while just to keep the data in place. This way the CRM system will end up reflecting stale and unusable data for the sales leaders to analyze and get insights as to where they can step in for certain tangible help. To solve this, you may need to establish well defined guidelines and processes which can serve as a single stop blueprint for your team to follow.


6. Create CRM Advocates

Creating CRM advocates or ambassadors from the end user of the tool is always helpful. Modern marketing revolves a lot around influencer marketing. You are much more likely to religiously try a new product if you were told about its benefit by an influencer having a similar background as yours. Your sales team will be able to appreciate the value of crm implementation only when they start using it. They will religiously use it for sometime only when you have CRM ambassadors from the team guiding them on the best practices and effective utilization of the tools.


7. Reward early practitioners

Getting the sales team to adopt a new tool can be tough. But it can be made easier if you start rewarding those early adopters who shall be setting up a benchmark and advocating best practices to peers. Reward the users who religiously update the tool and keep the status up to date. Reward the users whose CRM data is clean and is of high quality to derive fruitful insights out of it.


I hope you will find these tips useful for you. 

If you are looking for a CRM solution for your team, feel free to try out ToolsonCloud Sales CRM. It’s Free!


What is a Sales process and why do I need one?

This is one of the commonly asked questions from sales professionals as well as entrepreneurs who are getting into sales for their startup.

Let us explore more about the Sales process and the need for it in detail


What is a Sales Process?

Sales process refers to the well-defined steps for sales comprising various sales activities which helps in closing the deal thus leading to final conversion. The process of every organization may differ depending upon the industry in which they operate and the complexity of the business. However, there are certain common steps that are part of the sales process which are used as a reference. These are:


  1. Prospecting for Qualified Leads
  2. Pitching them the solution to generate interest
  3. Based on their interest, having further discussions with a detailed presentation, demo, etc.
  4. Negotiation on contract, pricing, and terms & conditions.
  5. Deal Closure
  6. Order, Invoicing, Payment follow-up, etc.

Sales Cycle

Using these steps as a reference, a Sales Manager or an Entrepreneur can easily build their sales process as per the context of their organization structure and process.

Well before we proceed, if you are planning to make use of CRM software to help organize your sales process, feel free to check out ToolsonCloud Sales CRM.


Why do you need a well-defined Sales Process?

More often we may find a defined sales process is only present in large organizations and not followed religiously in small businesses or startups. When the startups start scaling up, they realize their sales process is too complex to scale fast. This is where they start looking towards building an effective sales process.

Here are some of the reasons why you may need a well-defined sales process…


1. Scalability

When you have defined steps to follow as part of your sales process, it becomes a framework or a blueprint for your team to follow. Your team can just follow the blueprint and easily close the deal faster compared to when each of the sales representatives tries to follow their own approach which might work or might not.


2. Easy to Learn, Train, Mentor

Having a clear process that is followed across the team helps your team to easily learn that and they are equipped to easily train your new joiners to onboard them faster. Otherwise, if there is no process, whenever you assign a mentor to the new joiner, the takeaways will always be different for each new joiner and may lead to misalignment.


3. Low Customer Acquisition Cost

When you have a well-defined process, teams tend to spend less time recreating already validated experiments and focus on what works. This allows them to close more deals in a lesser amount of time which automatically brings down your sales operation cost. Lower the sales operation cost, lower becomes your customer acquisition cost. This way, you will be ready to close more deals with the same amount of sales budget.


4. Better Brand Image and Customer Loyalty

Customers often love organizations that follow a well-structured approach to whatever they do. This also includes how they sell and onboard the customers. If the sales process is streamlined and smooth, the customers will also be able to sense it based on the different sales touchpoints they experienced and how fast they were onboarded. Having a good onboarding experience always helps build a better brand image and customer loyalty. Loyal customers often become evangelists and they refer more customers to you.


I hope you liked reading this post. A good CRM tool always helps the sales team to work on a pre-planned and streamlined sales process. This also helps the sales manager keep track of the state of any particular lead so that they can pitch in to help out the team at the right moment. 


If you are yet to try out a CRM tool for your team, feel free to check out ToolsonCloud Sales CRM. ToolonCloud CRM allows you to create your own sales process with the help of customizable deal pipelines and stages.