Know numbers to manage your sales success
Last Updated: 12:36 October 23, 2012
In the sales arena, when asked, "How's business?" most salespeople respond with "Great." "Terrific." "OK, I guess." "Not so good." Or, "Good, all things considered." Most of these replies translate to, "I don't know."
Selling is a numbers game. Before you can answer the above question, you must first know your numbers. Then you can come back with: "I'm doing just fine. This week I made 22 calls, spoke to nine decision makers, booked four appointments and made two sales, resulting in a $1,700 commission."
As salespeople, most of us neglect one of our most important sales activities: keeping track of our personal statistics. By not doing so, we do ourselves a big disservice. Only by tracking your numbers can you monitor your selling behaviors. Then, you won't need a sales manager to tell you how you're doing. Furthermore, you'll know how to predict your own success.
As a sales professional, you know how important it is to sell every day, and that prospecting is the vehicle that enables you to sell every day. Prospecting is calling on people who may or may not need your product or service. In this broad category of suspects, some people won't talk to you. Of those who will, some won't need your product or service. Of those who do, only some will take the time to discuss their needs with you. Of this smaller group, some will drop out as you move them through the qualifying process. Some will not have the money or be willing to invest it with you. Others won't be able to make a decision. Those who remain are your real prospects.
The process starts when you pick up the phone or walk into someone's office to make a prospecting call. Each time you actually talk to someone will count as a contact; voice mail, no answer and locked doors don't count.
The person with whom you speak likely will be a receptionist, secretary or other gatekeeper who will try to keep you from speaking to your real target, the decision maker. Each time you get past the gatekeeper and speak to a decision maker will count as a conversation.
Some of those conversations will result in appointments. To differentiate between appointments booked and appointments kept, we will label the latter face-to-face opportunities. Of these opportunities, some will result in sales. For most people, the sale doesn't take place on the first call, so you may want to keep track of the number of visits required to close the sale.
The resulting numbers from one day of prospecting might look like this: You dialed the phone and/or walked in 30 times, spoke to 23 people, spoke with 15 decision makers and got an appointment with five of them. Four kept their appointment, and two bought. At $600 average commission per sales, you earned total revenue of $1,200 from your day's prospecting activities, or $40 per attempt, even though you didn't get through each time.
Let's look at your numbers in reverse. In order to make two sales, you had to get face-to-face with four people. To do so, you had to schedule five appointments from the group of 15 with whom you had conversations. In order to talk to these 15 people, you had to dial the phone and/or walk into an office 30 times. You had to deal with no-answers, hang-ups, answering machines and rude secretaries. However, as part of this process, each is worth money to you.
Suppose you want to increase your income by $3,000 in the next quarter. With an average commission of $600 per sale, you need five additional sales. The numbers indicate you need to schedule 13 additional appointments during the next 13 weeks. The numbers also indicate you need to make 75 additional attempts. If you prospect each week, then you need to make just six additional attempts during each of the 13 weeks — certainly a manageable task.
By monitoring your "numbers" on an ongoing basis, you will know how you are doing, can identify which of your selling activities need improvement and be able to accurately predict the impact of that improvement.
Bob Bolak is president and owner of Sandler Training in Boulder and can be reached at 303-991-0502 or firstname.lastname@example.org.