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How to measure sales in freight forwarding

Created on | Last updated on December 1, 2021 at 05:05 pm

To improve your freight business, you not only need to have a solid sales strategy, but you also need to know how to measure sales in freight forwarding. 

Any freight forwarder, large or small, should be able to measure business parameters to know how their sales performance is going. Measuring and tracking your results is one of the best ways to know what is working and what should be changed to get the results you expect.

Blindly relying on your instincts will hardly show you exactly what needs to change to improve your strategies and get better results.

Measuring sales in freight forwarding

Data is the basis for understanding the sales performance of your freight company.

According to Andrea van der Biest’s article, to be successful in freight forwarding, it is vital to measure and study some key results. By collecting and analyzing data, your sales team will be able to identify whether or not there is a need to make changes in your sales strategy.

That is why sales metrics are indispensable instruments to guide decision-making and provide a clearer view of the effectiveness of commercial strategies.

Sales Key Performance Indicators (KPIs)

Logistics key performance indicators, or simply KPIs (Key Performance Indicators) are extremely important tools for management focused on results. They are metrics that help sales teams measure their effectiveness and efficiency, with the overall objective of improving strategies and processes to boost sales.

Based on the data provided by the logistics KPI, it is easier to identify the needs for adjustments and route recalculation to achieve the goals and objectives considered relevant to the sales team.

Most freight forwarding companies should define key sales metrics for their teams and regularly analyze their sales performance. 

But if you still don’t know how to measure sales in freight forwarding, don’t worry. We have listed below 5 sales metrics that all forwarders should look at.

5 sales metrics in freight forwarding

Identifying which metrics are needed to analyze the effectiveness of your strategies and measure your sales is not a simple task, but the examples below can give you a starting point.

  1. Leads generation

The first thing you need to know is that a lead is a potential customer who shows interest in our service.

Therefore, it is very important to know how many people you are attracting to your forwarder business who are showing some interest in what you offer. The number of new leads is a very important key sales metric for the team, essential for business growth.

  1. Freight quote volume

This metric represents the total number of freight quotes sent. By monitoring it, you can get a general understanding of how many quotes your sales team generates per day, per week, and month.

Even though there are other factors that influence your freight forwarder partner’s decision to do business with you, this metric is important because the volume of freight quotes sent is indirectly related to the number of bookings you gain as a result.

  1. Conversion rates

The main conversion rate to look at is the sales closure rate. At this point, you should compare how many quotes you issued versus how many of them were accepted and completed. This KPI can provide you with the necessary knowledge about the status of your sales and, therefore, of your forwarder as a company.

This is another essential parameter to measure the performance of your sales. An accepted quote is a commitment on the part of the customer, but it is also an indicator of a successful sale. The number of accepted quotes has a direct correlation with future bookings.

  1. Sales volume

Do you know what are the main services, specifications, origins, and destinations requested by your customers and partners? If you still don’t know, it’s time to take a look at it…

Tracking sales volume in each route and modality will help you identify which ones are most in-demand so that you can really get to know your customers, and partners and work on their needs.

Besides that, monitoring your customers’ and partners’ activity will allow you to focus your efforts on getting the most competitive rates on those main routes, for example.

  1. Profit per client 

Every freight forwarding company has as one of its main goals to make a profit from its business. None of the above sales metrics make sense if you invest a lot of resources in something that costs you more than it returns. 

So make sure to measure the profit margin in freight forwarding that you make for each customer and update your list of key partners frequently.

This data can reveal not only the profitability of your business but also help you work on strategies to gain the loyalty of your customers and partners so that they keep making business with you. 

This can be a game-changer for any freight forwarder.

As a freight forwarder, it is vital to rely on analytics. In fact, KPI logistics tracking can be the key to success. 

Now that you know how to measure sales in freight forwarding, it’s time to get to work.

Time to get down to business

Even after this guide, the process of analyzing those metrics is still not that simple, that’s why using an analytics tool helps.

Therefore, investing in a Business Intelligence tool is the ideal option for making strategic decisions, achieving goals, and solving problems. BI tools access and analyze data sets and present analytical results in reports.

Choosing the right Business Intelligence tool for your logistics and freight forwarding company will allow you to make decisions based on real-time data, which leads to optimization of various processes within your business organization.

In case you don’t know it yet, Parnity has a great Business Intelligence tool – Partnership Analytics. This feature allows forwarders to view all their business data and understand if they are making win-win partnerships, click here to know more about it.

In addition, using Parnity’s Partnership Analytics, you can view not only the volume of business sent to your partner and the volume received and profit generated with that partner but also the amount of business you have exchanged per month and know what are your main business.

This way you can better observe which partners bring you more business so that you can maintain a good relationship with them, as well as know in which countries you have moved the most cargo and which you need to improve. And not only that, but you can also understand what can be improved regarding your partnerships to be more profitable and from there make the right decisions based on your own experience.

By seeing your freight forwarder’s data clearly, you can identify key points faster and act even faster. Know every inch of your freight forwarder and the behavior of your customers, and then nothing else will stop you from standing out in the market.