Key Performance Indicators (KPI’s) are essential for evaluating the effectiveness of a company’s operational success and overall performance.  KPI’s specifically help determine progress against a set of targets associated with a marketing campaign, sales program or other strategic financial, and operational goals.


For businesses that issue quotes, a well-designed quoting solution can offer an effective method to measure KPI’s related to marketing efforts, sales programs and other key business revenue benchmarks. Here are some valuable KPI’s that can be applied as part of a good sales quoting solution:

Quote Conversion Rate: Measures the effectiveness of the sales team’s ability to convert leads into sales and identifies the success of the quoting process. Adding the sum of the Converted Quotes and dividing by the total number of quotes issued gives you the conversion rate. Multiplying by 100 then gives the percentage.

With a good sales quoting solution, the conversion rate is a routine calculation that’s easy to tabulate on a quarterly, monthly, weekly or daily basis. However, when quotes are scattered across the organization, either in Word or Excel documents it can be a challenge to consolidate this information to tabulate the hit rate.

Quote-to-Order Time: Another useful KPI is the quote to order time. That is, how long it takes to convert an issued quote to an order. By measuring this KPI, a business can take steps to tackle bottlenecks and shorten the sales cycle. To evaluate the efficiency of the quoting process, the average time taken from issuing a quote to receiving the order is calculated as “Total Time from Quote to Order / Number of Quotes. Again, with a centralized quote solution this measurement is easy to setup and track.

Quote Response Time: This KPI is important for businesses that require input from various departments to issue a quote. Measuring the Quote Response Time, keeps a business informed as to the efficiency of the sales team to reply to customers’ requests for pricing. For example, a company that sells complex equipment may need input from engineering or product managers to finalize elements of the quote. This means more than one person needs to contribute to the quote, and based on availability and workloads, delays can factor into the process. Measuring the time between the date a quote request is received and the time it is issued, provides feedback to the business on productivity of the sales team and allows a business to act if unnecessary delays are common in the process.    The average time taken to respond to a quote request is calculated by Total Time to Respond to Quotes / Number of Quotes

Quote Pipeline Value: The pipeline is an estimate of the dollar value of open quotes and helps in forecasting future revenue. In its simplest form it is the sum of “All Open Quotes” multiplied by the hit rate. For example, if a business has 300k in open quotes and a 35% conversion rate the forecasted value would be 105k in estimated future orders.  Another approach is to apply a probability of winning ( e.g 20% 40% 60%, 80%) as part of the quoting process. Under this approach the forecasted value would be the sum of All Open Quotes multiplied by the average probability.

These are just a few sales KPI’s that can be measured with a good quoting solution.  In addition to these key factors, a business may also want to track:

  • Quote Accuracy
  • Sales rep performance
  • Quote revision rate
  • Quote approval time
  • Multiple other KPI’s

In summary, Key Performance Indicators (KPI’s) provide valuable insight into the performance of any business and help management make better business decisions. The KPI’s will vary by businesses and depend on the business goals of an organization, such as revenue growth, margin enhancement or improved customer satisfaction. To effectively measure these results a good sales quoting solution will simplify the task of tabulating and reporting any set of KPI’s associated any business that issues quotes to generate orders.