IMPROVING OUTSIDE SALES

Executive Summary: IMPROVING OUTSIDE SALES. This white paper is intended for business owners that currently have outside salespeople, but are frustrated with the poor results those salespeople have been getting.

IMPROVING OUTSIDE SALES

Improving Outside SalesThe salespeople always seem busy, but their results are disappointing.  Whenever you confront them on their lack of new sales, they do a wonderful job of “selling you” on the fact that they have some great stuff on the fence that’s about to land!  So you wait.  And you wait some more while they stay busy looking like they’re really busy.  A few months go by, and then you confront them again.  What do they say?  The same exact thing they did last time and the cycle continues.  And you wait again.  Sound familiar?

Maybe you’ve been a salesperson before, but that was a long time ago.  Or, you’ve never been a salesperson yourself and you aren’t confident in your ability to manage salespeople.  You think you have a great salesperson, but something just doesn’t feel right.  How can this salesperson appear to work so hard but have such poor results?  Let’s explore that question!

Being a salesperson is a very hard job; especially when you do it right.

Think about it:  Salespeople don’t have the luxury of coming in to a structured day of work unless they structure it themselves.  Salespeople don’t have work waiting for them; they have to create the work themselves!  Salespeople are faced with rejection on a daily basis.  Have you ever noticed that great salespeople like to work with other people?  Well, the truth is, salespeople spend an enormous amount of time alone!

To be great at sales, you have to be incredibly disciplined.  There is nobody following you around all day to make sure you’re doing what you should be doing.  You have to be organized, passionate, smart, well-spoken, mentally tough, and you must be committed to growing revenue.  But even all that is not enough to be great at sales.

First off, you have to have a sales system.  Think of all the other areas of your business that have systems.  Now imagine if none of those systems existed.  People were just told to “start producing.”  How effective would they be?  The obvious answer is that they wouldn’t be nearly as effective.  Systems are critical in every area of your business; including sales.

What is a sales system?  It is an outline of the all the necessary steps that need to be taken in order to move someone from being a prospect to becoming a customer.  Each one of these steps has a purpose and a specific objective (goal).

For example, the first step in your sales system could be the “cold call.”  The purpose of the cold call may be to find out if the prospect company has a need for your product or service.  This is called “qualifying” the prospect.  If the prospect doesn’t have a need for what you’re selling, then your salesperson needs to know that right away so no additional time is wasted in trying to sell to someone that will never buy from you.

If on the cold call, your salesperson finds out that indeed, they do have a need for your product or service (and are likely already getting it from a competitor of yours), then the purpose of the call is to find out the name and title of the person at the prospect-company that makes the final decision in purchasing your specific product or service.  The objective, then, of the cold call is to (1) qualify the prospect company, and (2) if qualified as a prospect (potential buyer), find out the name and title of the decision maker.

Okay, great.  Now what?  Well, the second step in the sales system could be the “Warm Call.”  This is when your salesperson makes initial contact with the decision maker.  The purpose of this call could be to (1) re-qualify and make sure the person you’re talking to truly is the final decision maker.  Once you qualify that the company does have a need for your product or service and you really are talking to the final decision maker, your next objective of the Warm Call could be (2) to gather important information from the decision maker such as how much of your competitors products or services they’re currently buying (how big a prospect are they?), and (3) to ask some smart, probing questions in order to determine some areas of “pain” the prospect may have with their current vendor, (4) give the prospect a powerful benefit you may be able to provide him/her, and (5) to get permission from the decision maker allowing you to get some information to that person and call back in a week or so with another phone call.  The objective of this step, then, is to “get permission to take info and call back.”

The next step in your sales system could be the “Hot Call.”  Objective (goal) of hot call: to schedule a face-to-face appointment with the decision maker.

The next step after that might be “The Appointment.”  The objective of the appointment may be to get a signed contract.  Or it may be to get a commitment from the prospect to give you a try the next time they need your product / service.  Or it may be to schedule another appointment to give a full-blown product presentation and a formal proposal.

The particular steps in your sales system are dependent on your industry or your individual company and need to be tailored as such.  No matter; it is imperative your salespeople have a system to follow.  NOTE:  FOR YOUR REFERENCE, A SAMPLE SALES SYSTEM IS PROVIDED IN THE “ACTION STEPS” AT THE END OF THIS WHITE PAPER.

So the first step in answering the question, “How can my salesperson appear to work so hard but have such poor results?” is to make sure a system exists and that your salespeople are trained and know how to execute the system.  If and when they have a sales system, you’re off to a good start!  But that alone is not enough!

Once the system is in place and your sales team is trained, they need activity goals.  Remember, the ultimate goal is to “make sales” and “increase revenue,” thereby, increasing profits.  But there’s something called a “sales cycle” that needs to be considered.  The sales cycle is the average amount of time it takes to move someone from being a prospect to becoming a paying customer.

If you’re selling office supplies, for example, the sales cycle may be very short.  Since many of your prospects order office supplies every week, you have an opportunity every week to get them as a client.

But other industries have much longer sales cycles.  For example, if you sell jet engines to aircraft manufacturers, they may contract to buy this product only once every three years.  If that’s the case, then you’ll have to wait up to three years just to have a chance to make a sale, even after they’ve committed that they’re interested in buying from you!

Obviously you can’t just sit around for years waiting for a deal.  You have to continue to “hunt” to find other opportunities.  Even if you sell office supplies, you can’t wait around hoping that the prospect will buy from you next week.  No matter how long or how short your sales cycle is, salespeople have to constantly fill the “sales funnel.”  In other words, salespeople need to keep finding prospects and continually move those prospect-accounts through the sales system you’ve created.

In case you haven’t noticed, most salespeople tend to be competitive.  They like results and they like them quickly.  Without tangible results (i.e. new customers) from their activity, they can become frustrated.

To keep them motivated and focused on important sales activities, create a point system for them.  This point system is where you award points based on executing the specific steps in your sales system.  The more time-consuming steps earn higher points.  Easier steps, such as making a cold call, earn fewer points.

Of course, the most points should be awarded for the ultimate victory:  Earning a new customer!

As an example point system, using the hypothetical sales system outlined above, your point system may look like this:

  • Cold Call:  1 point (if objective is met)
  • Warm Call:  2 points (if objective is met)
  • Hot Call:  5 points (if objective is met)
  • Attending an appointment:  10 points
  • Scheduling a follow-up presentation:  5 points
  • Making a follow-up presentation:  10 points
  • Follow-up phone calls:  1 point
  • Earning a new customer:  20 points

Then, pick a number of points you think are the minimum allowable points in a day.  For example, you may determine that your salesperson must earn a minimum of 40 points per day (averaged each week).  Also, be sure to pick a number of points that constitute an “exceptionally great” day!  The best salespeople are more motivated to have an “exceptional day,” rather than to simply “exceed the minimum.”  It’s psychological, I know.  But that’s how salespeople think; trust me!

Let’s recap what we’ve done so far:  First, we asked the question, “How can my salesperson appear to work so hard but have such poor results?” The first answer to that question is that your salesperson may not have a sales system.  We discussed how to create a sales system.  Next, we addressed the necessity of having a point system in place so your salespeople can have activity goals and know where they stand relative to those goals.  A point system not only motivates salespeople, it also keeps them focused doing the right things with their time.  Now, we’ll address a third “common mistake” many businesses owners make:  They don’t equip their salespeople with proper contact management systems.

Simply put, a contact management system is a tool for salespeople to use to help them manage their contacts (prospects) efficiently.  In the olden days, salespeople used paper systems including index cards, post it notes, notes on the back of business cards, scrap pieces of paper and the like.

Today, there are many powerful computer based, contact management systems on the market (also referred to as contact database management systems or contact records management systems- “CRMs.”).  If your salespeople don’t have this tool, they’re getting eaten up by your competitors’ salespeople that do use an electronic system!

A contact database management system is computer software that acts as an electronic rolodex, but with many powerful features.  For example, each prospect is assigned an ID Status by your salespeople.  By providing an “ID Status” for each prospect in the system, your salespeople can look up contacts according to where they stand in the sales cycle.  For example, if your salesperson wants to make cold calls, he can find the group of people he’s looking to cold call simply by clicking the lookup button and then entering, “Cold Call.”  All of the prospects that need to be cold called that are in the database will pop up.  Each step in your sales system is mirrored in the ID Status lookup feature of your software.  This keeps your salespeople organized, giving them a huge competitive advantage.

Furthermore, this software provides a notes tab, which allows your salespeople to see all of the notes that were entered after every interaction with each prospect.  Nothing is left to memory!  These notes are critical for salespeople in deciding what tactic to employ next to move the prospect to becoming a customer.

There are alarm settings for prospects in the database that will pop-up at the date/time your salesperson sets.  For example, if the prospect asked your salesperson to call back in two weeks, the salesperson sets an alarm that will remind the salesperson to call the prospect two weeks later.  Salespeople spend their precious time moving people through the sales system; a contact database management system prevents prospects from “falling through the cracks,” thereby wasting all the time that was invested into the prospect up to that point.

In addition to helping your salespeople organize contacts; this software also allows your salespeople -or sales managers- to instantly pull up reports, which are valuable in tracking activity.  With networked versions of the software, or web-based versions, sales managers can pull up and monitor activities even if their sales team operates in different States or even different countries!  Furthermore, your salespeople can work with the same database when in the office, at their homes, or while travelling.

Some popular contact database management systems include Act, GoldMine, and Salesforce, just to name a few.  If your salespeople currently don’t have a tool like this, please make it a point to explore the different options available to you.  It’s well worth the investment!

We’ve addressed three major reasons salespeople seem to work so hard, but have poor results: (1) Lack of a sales system, (2) Lack of an activity point system, and (3) Lack of a contact database management system.  Those are big ones, but here’s a short list of other things to consider when diagnosing your salespeople’s specific challenges along with some proposed solutions to consider:

Problem (4):  Salespeople that don’t have solid selling-skills.  Solution:  Enroll them into a sales training program.  This requires an investment of time and money, but if you think your salespeople are otherwise committed to your company, this may be a wise investment for you to make.

Problem (5):  Salespeople don’t have adequate product knowledge or company knowledge.  Solution:  Teach them!  Make sure they know your product inside and out!  They should also be familiar with your competitors’ products or services.  There’s nothing more frustrating than talking with a salesperson that has little industry and/or product knowledge.  Your salespeople should also know your company’s history, market position, and the competitive differentiators that will allow that person to passionately sell his/her prospects on why that person should want to do business with your company.  Have your salespeople spend some time working in different departments in your company. Have them work in production, customer service, shipping, and any other departments that directly “touch” your customers.  With this additional, “first hand” knowledge, your salespeople will be much better equipped to bring in new customers.

Problem (6):  Your salespeople don’t have an adequate “hit list” of prospects to call on.  If your salespeople have small or old lists of prospects to call on, those lists become stale and difficult to be effective with.  Please be sure your salespeople are continually adding new prospects in their CRM system.  When they have a large list of prospects to call on, your salespeople will be much more effective.

Problem (7):  Your salespeople are simply not ever going to be great salespeople.  Solution:  Replace them immediately.  This problem is more common than people would like to admit.  It’s also the most costly.  Listen, some people simply aren’t cut out to be outside sales representatives.  No matter how great your sales system, no matter how many tools and how much training you provide them; they’ll never be great.  They don’t have the inherent skills necessary to be great at sales.  At the beginning of this white paper, you read about a few of those characteristics:  “Disciplined, organized, passionate, smart, well-spoken, mentally tough, and committed to growing revenue.”  If any one of those characteristics is missing, a person could be doomed to mediocrity at best as an outside sales representative.  If two or more of those personality traits are absent, you’d probably being doing everyone a favor by encouraging that person to find a new profession where he or she can excel.

This white paper does not cover every single possible reason salespeople seem to work so hard, but have poor results.  We’ve touched on some big ones, but there certainly are other potential reasons.  If you’re still not sure what to do next, I suggest you have a private conversation with your ineffective salesperson (salespeople) and ask them straight out, “Why aren’t you having better results?”  Don’t accept that “things are on the fence and about to land.”  Instead, keep the conversation focused on why it’s taking them so long to close new business.  The answers you get from this conversation should assist you in deciding what to do next.  Just make darn sure your salesperson and you leave this meeting with an agreed upon and tangible next-step.  If your salespeople aren’t bringing in new business in a timely manner; something’s broken.  You have to take specific action to fix it because it won’t go away by itself.  That’s a fact.

It will take time and possibly even emotion.  It won’t be easy.  But you can do it!

Review / Action Steps

    1. Please make sure your salespeople have a written “sales system,” or “sales model” to follow.  Here is a sample sales system to help you in creating your own:

      XYZ Company – Sales System

      1. Cold Call – the objective of the cold call is to (1) qualify the prospect company (do they buy what you sell?), and (2) if qualified as a potential buyer, find out the name and title of the decision maker.
      2. Warm Call – the objective of the warm call is to (1) re-qualify and make sure the person you’re talking to truly is the final decision maker, (2) gather important information from the decision maker such as how much of your competitor’s products or services they’re currently buying (are they a big prospect, or a little one?), (3) ask probing questions to get the decision maker to tell you the areas of “pain” they have with their current vendor, (4) get permission from the decision maker to get him/her some information and to follow up next week with another phone call.
      3. Information Drop – the objective is simply to get information to the decision maker.
      4. Hot Call – the objective of the hot call is to schedule a face-to-face appointment with the decision maker at a specific date and time.
      5. The Appointment – The objective of the appointment is to get a signed contract (or to get a commitment to purchase from you the next time they buy – or- to schedule another appointment to make a full-blown presentation…whichever of these objectives best meets your requirements).
      6. Follow-Up Call – The objective of the follow-up call is to (1) re-connect with the decision maker so he/she does not forget about you, (2) to get a recommitment from the decision maker to buy from you next time he/she purchases your goods or services, and (3) to get permission to follow-up again on a certain date if you haven’t heard from the decision maker first.
    2. Create a “point system” to keep your salespeople focused on doing the right things to generate revenue.  A point system is also an effective accountability tool that sales managers and/or business owners should use.  Here is a sample point system that you can use to get ideas in creating your own:

-Sample Point System- 

      • Cold Call:  1 point (if objective is met)
      • Warm Call:  2 points (if objective is met)
      • Info-Drop:  4 points (if objective is met)
      • Hot Call:  5 points (if objective is met)
      • Attending an appointment:  10 points
      • Scheduling a follow-up presentation:  5 points
      • Making a follow-up presentation:  10 points
      • Follow-up phone calls:  1 point
      • Earning a new customer:  20 points

*Minimum acceptable daily points = 40 points per day (averaged each week)

*Outstanding results = 47+ points per day (averaged each week)

  • If your salespeople do not currently have a computer-based contact database management system, then please look into buying one.  The benefits of having this are significant and the cost in purchasing this software is typically between $150 and $2,000, depending on whether you want stand-alone systems or networked versions (including “the cloud”) and depending on how much other functionality you want or need.  My suggestion is to start simple and move up later if/when you want to.
  • Make sure your salespeople have the sales training they need in order to be most effective.  If you can handle this yourself, great.  But if you don’t have vast experience in outside sales or in sales management, then you should seriously consider outsourcing this training.  My favorite sales training program is ClientBuilder™, but check your local area to find the outfit that’s the best fit for you.
  • Be sure your salespeople have enough product knowledge to be able to differentiate your product or service from that of your competitors.  That means they need to know your products or services inside and out, and they also need to know your competitor’s products or services just as well.
  • Please make sure your salespeople know about your company history and your overall operating system.  If your salespeople don’t know your company history and aren’t able to “sell” people as to why your company is the best to work with (i.e. your “quality control” processes), they’re at a distinctive disadvantage to your competitors who do know their companies. 
  • Please be sure your salespeople have a large database of prospects to call on.  If their lists are too small, it is highly likely they’ll spend more time on disqualified “non-prospects” because they don’t know what else to do with their time.  Make sure they have a large prospect-base and also be sure they update it as new prospects are identified.
  • If you’ve done everything you can to set your salespeople up for success and one or more of them still isn’t producing results, you have to let them go.  There’s nothing more costly than carrying salespeople that don’t produce.  It wastes your money and demoralizes and angers your other team members.  Please remember, “good intentions” are nice, but “results” are required.

 

SUMMARY

If you have poorly performing or even just mediocre performing outside sales representatives, you really need to address it.

This white paper addressed some common reasons salespeople suffer and the tools that can help them improve.  Listen, if you want better sales results but aren’t providing the right tools, you’re setting your salespeople up to fail.  Please don’t do that!

It is just too expensive to have ineffective salespeople.  Frankly, the other departments in your company will begin to resent the sales team if the results aren’t there.  You’re not the only one that notices poor sales performance and you’re not the only one that’s frustrated by it.

Outside sales is a very tough job, both mentally and emotionally.  It’s demoralizing to have doors slammed in your face day after day.  So please do all you can to make sure your salespeople have all the tools they need to have doors open for them instead.  You win, they win, and your entire team wins!  It’s well worth the effort.

If you have a salesperson that’s still not cutting it even after you’ve provided them all the necessary tools and training, then you have a responsibility to move that person to a job more suited for him or her; either inside or outside of your company.

Sales cycles can be long or short; depending on your particular industry.  New salespeople absolutely need time to “fill their funnel” of prospects and it takes time to build relationships.  Once your new salespeople are trained and equipped to do the job, you have to be patient as they go shake things up.  Be patient and encouraging.  And when the new orders start coming in, be sure to make a big deal out of it!  Your salespeople will appreciate you celebrating with them when they bring in new accounts.

While it’s important to be patient with new salespeople, you also have to listen to your gut.  If you believe that your salespeople appear to be busy but aren’t getting the results you expect, then you have to address it professionally.  This white paper showed you how to do that.

This isn’t easy to do.  It does require time, effort, and even some money.  But if you’re going to do it; do it right.  I wish you all my best.

Copyright 2013 by Jon Denney

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