Cost of Sales is a critical KPI, particularly when you operate on thin margins. Influencing factors include attrition, training, travel, equipment, compensation, recruiting and administrative costs. Some of these are generally fixed while others can vary widely.
If 100% of your salespeople consistently make their quota or budget at the desired margin, much of the concern about Cost of Sales would evaporate.
So why worry about it? I was speaking with an SVP of a brand-name company with thousands of salespeople. He told me that most all of their sales teams have only a few (2-3) salespeople achieving quota while the rest consistently struggle. Let’s take a look at a typical sales team of 8 people.