Reducing Cost of Sales per Order Without Losing Deals

Why cutting in sales so often goes wrong

When margins come under pressure, sales costs quickly end up on the list. Travel costs, trade fair budget, working time for quotes: all of this can be cut, and the saving is immediately visible. The damage shows up later and less clearly, as an order that does not happen or a regular customer who orders less often. Because nobody puts the two numbers side by side, the cut looks like a success.

The guiding question of this guide is: how does a small business reduce its cost of sales per order without losing deals? To answer it, we first clarify the metric, break it down into three links with a mental model, look at what studies show about visits and remote contacts, weigh two perspectives, and finally arrive at levers in a fixed order.

A sales operation does not get cheaper by doing less, but by doing less for nothing.

Terms: cost of sales per order and what belongs to it

Sales costs are all costs incurred to win or retain an order: working time in sales and the inside sales team, travel, preparing quotes, trade fairs, advertising, tools such as the CRM, and commissions where applicable. Cost of sales per order is these costs in a period divided by the number of orders won.

These must be distinguished from the costs that arise only after the order, such as processing, picking, shipping, or travel to the site. The guide setting a minimum order value calls them handling costs per order. Together, both types of cost determine whether a small order is worthwhile. This guide deals only with the first: what it costs to get the order.

The metric has a weakness you need to know. Some sales costs only take effect later, such as a trade fair conversation that leads to an order the following year. Monthly figures therefore fluctuate strongly. The figure becomes meaningful over a quarter or a year and in comparison with the previous year. This fits the rule in the guide sales KPIs for small businesses: the trend matters more than the exact value.

The mental model: the cost chain per order

To see where savings are possible without losing orders, a simple breakdown helps, which I call the cost chain per order. It follows the path from contact to close and has three links.

1. Cost per contact

   What does a conversation with a customer cost, whether a visit, a video call, or a phone call? A visit including travel costs many times as much as a remote contact.

2. Contacts per quote

   How many conversations does it take until a quote is ready, including follow-ups? Unclear inquiries and missing documents drive this number up.

3. Close rate

   What share of quotes becomes orders? Every lost quote spreads its costs over the won ones.

The links are connected, and this is the reason for most misguided cuts. Replacing visits with phone calls lowers the first link. If this lowers the close rate, the third link can more than eat up the gain. Conversely, an additional contact to clarify needs may look expensive and still lower the cost per order, because it raises the close rate.

The example shows why cost per order alone is not enough. Pure remote selling has the lowest cost per order here and still the worst result, because it brings fewer orders for the same effort. The metric must therefore always stand next to the number of orders and the contribution margin.

What studies show about visits and remote contacts

Ergun and Schmitz (2026) examined how the mix of in-person visits and remote contacts by video or phone affects sales performance with existing business customers. They analyzed two field studies at a leading European industrial manufacturer: CRM data on 3,565 customers with 15,172 contacts over 18 months, served by 27 salespeople, and a second sample of 651 customers whose survey responses they linked with the CRM data.

The relationship had the shape of an inverted U: a medium share of remote contacts performed better than pure visits and better than pure remote contact. For customers with average requirements, the best share was about 36 percent. For simple products, customers who prefer remote contact, and experienced salespeople, the best share shifted to 62 percent and brought up to 27 percent better sales performance than pure visits. For complex products and customers who prefer in-person conversations, pure remote contact could lower performance by up to 32 percent. The authors explain this with media richness theory according to Daft and Lengel (1986): remote contacts allow more conversations, but they lack cues that foster trust and informal exchange in face-to-face meetings.

Ahearne, Pourmasoudi, and Habel (2025) arrive at a similar picture at the level of whole companies. In panel data on 194 firms, greater reliance on inside sales, meaning salespeople without field appointments, increased the number of contacts with customers and thus performance. At the same time, these contacts were of lower quality, which lowered performance. The net effect tended to be positive when exchanges with customers were not very demanding and management could steer the inside sales team well.

Two perspectives: efficiency or relationship?

Both perspectives have evidence on their side, and the studies show that they are not mutually exclusive. The mistake lies in applying one of them equally to all customers. I therefore consider a rule by customer and occasion to be right: visits where the service is complex, the customer is of high value, or a new need has to be clarified; remote contacts where the issue is coordination, follow-up, and recurring orders. This corresponds to the inverted U of Ergun and Schmitz: not either-or, but the right mix for each relationship.

The levers in the right order

From the cost chain and the findings, an order emerges. It begins with the levers that lower costs while protecting or raising the close rate, and ends with those that can put the close rate at risk.

1. Screen inquiries earlier

   Before the first costly meeting, clarify whether need, budget, and timing fit. How to do this is described in the guide lead qualification. Every inquiry screened out early saves all further contacts and raises the close rate.

2. Make quotes more targeted

   Fewer but better-fitting quotes lower the cost per order twice over. Structure, follow-up, and reasons for rejection are covered in the guide quotes that win.

3. Allocate effort by customer value

   Rank customers by contribution margin and potential and decide for each class how many visits it receives. In a study of 310 firms, Homburg, Droll, and Totzek (2008) found that such prioritization increases average customer profitability, as the guide ABC analysis of customers describes.

4. Replace visits with remote contacts selectively

   First replace the contacts that need little clarification: follow-ups, scheduling, questions about existing orders. Keep visits for new needs and complex questions.

5. Take routine off salespeople

   Take off salespeople whatever is not selling: typing up quotes, maintaining data, writing reminders. Which routines pay off first is shown in the guide automating sales.

What you can do this week

• Calculate cost of sales per order for the last quarter and the same quarter of the previous year.
• Estimate the cost of a visit including driving time and of a remote contact.
• For ten quotes from recent months, count the contacts until the decision.
• For each customer class, decide which contacts happen in person and which remotely.
• After three months, check whether cost per order, number of orders, and close rate have moved in the desired direction.

Conclusion: how a business cuts sales costs without losing orders

To answer the guiding question: a small business lowers its cost of sales per order without losing deals when it works on all three links of the cost chain and begins with those that protect the close rate. Screening inquiries earlier and making quotes more targeted lower the contacts per quote and raise the close rate at the same time. Allocating effort by customer value and mixing visits with remote contacts lower the cost per contact. The studies by Ergun and Schmitz (2026) and Ahearne and colleagues (2025) show that this mix must be chosen per customer and occasion, because pure remote contact harms performance with demanding customers.

The limits lie in the data: the findings come from larger companies and a single manufacturer, and sales costs often take effect with a delay. That is why every cost figure needs the number of orders won next to it. A cut after which both numbers fall is not a saving.