Let's
say your company sells to consumers, maybe in a retail setting or maybe in the customers' homes, or maybe you find your own leads as in insurance or real estate selling.
Let's look at [your]imaginary company that employs three sales professionals who sell widgets to customers. And, for the sake of this discussion, let's say you provide the same number of leads to all three of these sales representatives by you, their employer:
Sales Representatives "A" "B" and "C" all meet with 65 prospects per month. [Adjust this number of prospects for your real business numbers: if you sell retail, your number will likely be higher; if you sell in customers' homes, your number might be lower, if you sell insurance or real estate you might need to adjust it either way.]
Let's imagine that Sales Rep A sells to 45% of his prospects, and let's say this is the average for your industry. [Adjust this number for the average in your industry]. That's 29.25 prospects each month that he converts to customers.
Let's say Sales Rep B closes sales at a rate below your industry's average, let's say at 31%. Therefore, he sells 20.15 customers each month.
And finally, Sales Representative C closes at a rate higher than your industry's average, let's say at 67%. She sells 45.5% of her prospects.
Summary:
Sales Representative A:
> Closing Rate 45%
> 29.25 Sales per month
Sales Representative B:
> Closing Rate 31%
> 20.15 Sales per month
Sales Representative C:
> Closing Rate 67%
> 45.5 sales per month
The impact these three individuals have on your business is astounding! Clearly, Sales Representative C is the big winner here. She sells more than twice as many customers as Sales Rep B, and over 50% more than Sales Rep A. What if you could get all three sales representatives to close 67% of their prospects?
That would result in 136.5 sales per month instead of 94.9. That's an increase of over 45%!
And imagine if this is accomplished with no increase in your marketing budget. Your sales team is simply selling more of the shoppers or prospects that they see on a daily basis. Wouldn't that be terrific?
Now let's add another metric: Average Sale (or "average ticket"). Here's how your sales staff stacks up:
Sales Rep A: $1200 average ticket (the industry average, let's say).
Sales Rep B: $1000 average ticket (obviously, below the industry average).
Sales Rep C: $1400 average ticket (way above the industry average).
Using these numbers, along with the closing percentage as previously discussed, let's calculate the monthly sales revenue generated by each of your three salespeople:
Sales Representative A:
> Closing Rate 45%
> 29.25 Sales per month
> Average sale: $1200
> Monthly sales: $35,100
Sales Representative B:
> Closing Rate 31%
> 20.15 Sales per month
> Average sale:$1000
> Monthly sales: $20,150
Sales Representative C:
> Closing Rate 67%
> 45.5 sales per month
> Average sale: $1400
> Monthly sales: $63,700.
If we add up the revenue from each of your sales team members, we can see that your small business sells $118,950 per month ($1,427,400 for the year).
But what if Sales Reps A and B were selling at the same admirable rate as Sales Rep C?
Your company's annual revenue would jump to over $2.29 million, an increase of $870,000.
And of course, this doesn't take into account that your Sales Representative C should be able to increase her sales numbers as well.
It's simple, really. When you raise the closing rate of your sales team, along with raising the average amount of each transaction, you can increase sales dramatically.So, you ask, "how do I do this?"
You change the behaviors of your sales team.
Selling is behavioral. When salespeople do the right behaviors (just like golfers, cabinet-makers, brain surgeons, or pastry chefs), they get right results. Without changes in behavior, salespeople (and presumably, you as a sales manager and your entire organization) place themselves in a reactive state, waiting for the economy to turn around, waiting for some mysterious power in the universe to bless your business and increase sales success.
While sometimes waiting will result in sales improvements, it doesn't strike me as a viable way to run a business.
How do you change your sales team's behaviors?
1. You educate them.
Sales training must bring about sales learning. And sales learning must lead to changes in sales behavior.
2. You educate them some more.
Successful sales training is a process, not an event. Just as the goalie or the stage actor or the public speaker need constant reminders of how to behave (perform) properly in order to maximize performance, so do salespeople.
3. You coach them.
To successfully change behaviors, sales training just can't occur at a seminar, webinar, or during an online sales training program. They need to be touched repeatedly by someone who can help them analyze and study their sales behaviors. They need someone to suggest, help, inspire, motivate, encourage, teach, and shape each salesperson.
4. You manage them.
To successfully change behaviors, management systems (hiring, performance reviews, compensation, daily operations, priorities, standards, etc.) need to work in concert to change sales behaviors in the organization.
* * * * * * *
Nothing mentioned here is new, or breaking new ground. It's not "Sales 2.0". There's no new sales magic here, no stunning new concepts. It's often said that sales is a "numbers game." But you'll only win the numbers game if you earn the right numbers.
So you want to improve the revenue production of your sales team?
Change their sales behaviors.
If you like this
post (or don't) please leave a comment.Skip Anderson is the Founder and President of Selling to Consumers Sales Training.
He works with companies that sell to consumers in
all B2C sectors to increase sales by realizing the buying potential of
every prospect.
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