Steer issue 24 July 2019 - Page 9



GROW YOUR BUSINESS – SALES
a load of roles, make sure you allocate time, and enough time,
to your sales. Don’t guess at how much time you need – work
it out. If you don’t, you won’t generate enough revenue and
your great idea will not flourish.
Step 1: How to start?
A good place to start is to look at where you want to be with
your sales. Preferably in profit, right? Note down where you
want your company to be in 5, 3, 2 and 1 years. I like to work
backwards, personally, but if you find this terrifying, just go
for one year to start! I also like to work out what I want to
be doing in 5 years, do I want to scale my involvement back
and let others run the day to day business so I can go to the
beach? Do I want to open other new businesses? Do I want
to concentrate only on one aspect of it? Who will I need to
do everything else, how much should they be paid and what
tasks will they do? How much revenue will I need to cover
those costs?
Spend some time on this. It’s not set in stone, it’s a starting
point.
Step 2: Know your market
Be clear on your market. Note down who your competitors
are. Work out who your target customer is (or customerS if
you have more than one type or product). How does your
business fit into the market as it stands?
Gain an understanding of who your target market is, and
the customers you want. Are they of a certain age group? Do
they shop in particular areas? What social media do they use/
papers do they read/tv shows do they watch? Are they high
flying executives or frequent travellers? Get into their shoes.
Then work out HOW best to reach them. As an example, high
level executives of 50+ aren’t as likely to be using Instagram
as a 20-year-old. They are more likely to have disposable
income. They may have ‘gatekeepers’ that you’ll need to get
around.
Step 3: Pricing
How does your pricing compare to your competitors? Know
your numbers here – what is your most profitable product
or service? Not the most expensive... But the most profitable.
For example, a print advert may be more expensive than an
online advert but as it involves more admin, post-sale support, printing costs and mailing overheads it may not be the
most profitable.
Be careful of discounting and too many offers. Work out
how many widgets you need to sell at the discounted price
to make your target. If you have offers, which can work really
well, use them sparingly, and alternate the products offered
if possible, otherwise your customers will come to expect a
discount or offer and wait for them, which will mess up your
sales cycle.
It’s also important to ask, what is your ‘cost per sale’? A
‘cost per sale’ is how much it costs to get that client for that
product. So this would be your overheads divided into a ‘per
product/service’ amount, salary for whoever is involved, the
cost of manufacture or delivery. That is your cost per sale.
The aim, of course, is to make profit on each sale. If your cost
to get a sale is under your revenue from that sale, you need
to revisit. Can it be streamlined without sacrificing customer
satisfaction? Do you need to shop around for suppliers?
Do you need to rent an office or is it cheaper to work from
home? Do you need to go to every event you’re invited to, or
should you pick and choose better to utilise your time more
effectively? Should you call more and email less? Is that more
time efficient?
Step 4: Positioning
Positioning is how you sit within the market, both from a price
point of view but also brand, and where you are in terms of
quality, recognition etc. Where would you like this to be? Is
this reflected in your pricing? Do you want to price high and
have fewer customers or low and have a large customer
base? What are your key selling points compared to your
competition? How do you stand out, what makes you different? Review your marketing materials, your emails and
your approach to see if this matches your desired position.
For example, if you have a high price product that should be
reflected in the way your marketing looks, sounds and feels.
Opening an email from a high-ticket supplier that starts with
‘you ok, hun?’ isn’t going to be the right tone for that client.
Step 5: Know your numbers.
Yes, this sounds very dull. But the more you track, the more
you can forecast and check to see if you are heading towards
your goals rather than just hoping it’s all ok. You will need to
know how many sales you will need to cover your costs, as a
minimum. You can work this out right now.
It’s also very useful to know how many clients you need to
make your target. They may buy more than once in a year or
buy several services or products. What is the average ‘sale
value’ of each client?
Then we need to work out how many clients you need
from these two figures.
Next, you need to know how many leads you need in order
to get those clients. This changes with every company. It’s
your conversion rate. So, you may need to get through 100
leads in order to make one sale (so the conversion rate is
1:100). Or it could be that you need only 5 leads in order to
make that sale (so the conversion rate is 1:5). You may not
know this yet but start tracking it now so that you can plan
for a) how much time and effort is needed to make a sale b) if
you need external help reaching those leads c) forecast your
growth regularly.
Let me give you an example, in a media company I work
for, we know that we want £1500 worth of sales per week,
per salesperson to make a healthy profit. We also know that
reaching them by phone gets the best result. So we look
predominantly at calling activity.
Because we have been tracking our numbers, we know that:
• Out of 10 calls to leads that they make, they get through
to the decision maker in 4 of them. The rest are voicemails
etc.
• Of those 4 decision maker conversations, 1 usually results
in a sale.
STEER YOUR BUSINESS 9

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