The success of businesses depends upon the success of sales people, aside from the greatness of the products and services offered.
- Selling is 70% dependent on the seller and only 30% on the companies offering itself.
- In wholesale, these numbers are even more biased to one side: 90% of the results depend on the seller and only 10% on the product.
Why is this percentage so high and why is it even higher in wholesale?
To better understand these answers, let us look deeper at the problem and find out how we can improve sales.
- What should be done to increase sales?
- What can be done to stabilize sales?
- What are the main keys that affect the positive sales results?
First we need to decide what exactly we mean by the sale.
There are four different levels of sales. The only difference is in the way a buyer makes decisions.
- Place an order. It’s simple. A buyer makes the decision to purchase an item. All that is required from the seller is to complete the deal.
- Consultation on the items. The buyer wants to buy a product and/or services but there is uncertainty in the model. All that is required from the seller to do is to help the buyer to make a choice.
- Convincing customers. A buyer has the desire but not the right choice. In this case the seller finally has to use the necessary skills to convince the buyer to buy the right product & services.
- Create a new need. The buyer still doesn’t have the desire. Here the seller should help the client to understand why they need the product and or service and to encourage the purchase.
The majority of sellers are on the first two levels, they handle ordering and advising on items Requirements to seller’s qualification who work in these two fields are generally low. It is enough to have basic sellers’ skills and to know the product itself. These two levels can be called “passive” sales.
In this case, Let’s concentrate our attention at the other two fields: ‘convincing customers’ and ‘creating a new need’.
The real sale starts here.
In order to make quality sales (good margins), a seller has to have the knowledge of sales techniques and have appropriate skills to persuade the buyers.
The reason wholesale deals have such a high percent depending on the sellers’ skill is easy to explain. Try to imagine yourself buying a TV for your family – that usually has more trust and ease in deciding, although decision is not always easy to make.
Now try to imagine buying 100 TVs from an outside source. As a buyer you need to be convinced not only in the best characteristics, benefits and advantages but also you have to withdraw yourself from the ‘comfort zone’. You will have to deal with your fears and doubts due to higher expense in dollars and greater consequences overall if the deal goes bad.
If you analyze the sales results of your sales staff you will make a very important discovery.
About 80% of successful sale deals are made by 20% of sellers.
The remaining 80% of your sales people bring you only 20% of deals.
Out of this 80% 5% of sellers make 50% of deals.
Selling is the most important key for many companies. Let’s try to figure out how to make this part of your business to run at 100%.
Proactively Lead Your Sales Team To Success
The number one important but often-overlooked key is to encourage high-performance sellers in the way that they could not even think about leaving you for another company.
Never follow the old principles that ‘if something is not broke yet then do not fix it.’
If it is not broke make sure that it won’t break ever.
Most people want recognition, not money. The biggest mistake you can make as a business owner or a director is not to praise your sellers for well-done job.
Develop a system of incentives depending on the type of product that you sell and especially on the margins they contribute “per product and service and each per each sales person”. Divide the salary in half. First is a fixed salary, which does not change and can only increase with time.
The second part should be progressive: either a percentage of sales, or the amount directly proportional to the plan. In this case it is advisable that the progressive part was substantial and in fact encouraged the sales people to perform better. Practice cash bonuses for the quarter based on SMART goals that are tracked by KPI. And create a good idea of paying one extra month salary before Christmas to the very best of your sellers. These methods will allow the staff to target long-term outcome.
The second thing you should do is to train your sales force but only after a careful diagnosis of what is needed to get them more time with more targeted buyers so you gain market share and margin. The best investment you can make is investment in your sales people. You should not teach only the weakest out of them. You should rather put more effort into training and advancing of the most successful ones. Spend 80% of your training efforts and expenses on the 20% of the most successful sellers.
Have regular corporate activities that support team building – such as meetings, New Year, Christmas, birthday parties, etc. Such events should not be too much expense, but they need to be memorable and are excellent forums for praise (yes some will have hurt feelings…deal with it). Give your staff small gifts and find the time for words of appreciation about the work they do. A candy bar may only cost a dollar, but a candy bar handed to you from the CEO is “priceless”
Sometimes the reason for the poor performance of sales managers is the forcing to sell more after they show you good results. If the seller has exceeded the plan this month you are enlarging his plan for the next month and then increase it again and again. Motivation and awards have nothing to do with it. All you will get is your seller trying to convince you that the work is difficult and the sale was impossible. Sellers do not want such life for themselves. Be reasonable and realistic setting plans for your sellers.
Organize the work of the department the way that the sellers could give at least 90% of their time to communication with clients. All the supporting work such as invoices, documents, letters etc. can be charged to the less competent personnel. One secretary can provide all the necessary documents to ten sellers. Think of it!
Monitor the work of your sellers by using two controlling parameters – the pre-planning for a week and the accomplished results in the end of this week. If the employer achieved the planned goal the sales results in general will be good.
One of the proven ways to control sellers and identify problem areas for customer service is a method of “mystery shopping. The Mystery shopping method of marketing research involves the assessment of the quality of service with the help of experts acting as regular buyers (customers, clients, and so on). Frankly, direct feedback from your real customers is the best and there are a variety of methods to do this but you probably do not have the resources to do these types of initiatives readily available. A combination of direct and mystery is great too.
And remember! Doesn’t matter how much you invest in advertising and the promotion of your business, if your sales, customer service and control systems are not debugged, the money will be wasted.
Your sellers are the number one people who promote your product and convince a buyer to make the right choice.
The seller is the one in whose hands the customer is. If you want to be closer to your customers, understand what they want and how to grow bigger on them you have to be closer to your sales people.
Don’t give your competitors a chance to thank you for your mistakes.