sales strategies Archives

29 Mar 2017

Sticky Post By Matt Hottle Posted in Engagement Selling System, Hallux Training, Sales, Training With No Comments Permalink

Why We Created Our New Sales Training Program

Sticky Post By Matt Hottle On March 29, 2017 With No Comments

I’ve seen it time after time—small business owners who aren’t happy with their sales team or their results. They call me with a single goal in mind—help me hire better salespeople.

That’s rarely the solution. If you aren’t training your current team, you haven’t set them up for success. Adding more untrained bodies will only subtract from your bottom line, demotivate your existing salespeople, and increase competition for the same meager sales. Firing and replacing your underperforming salespeople doesn’t address the problems in your program, like poor sales management, a lack of performance measurement, poorly designed incentive structures, and misalignment between sales and marketing.

I’ve been looking for sales training to recommend to these clients, but the few programs we’ve found are woefully out of date for the current marketplace, and none address entrepreneurial businesses.

That’s why we’ve launched our new sales training program. It’s called the Engagement Selling System, and it directly addresses the chronic struggle entrepreneurs face building and growing successful sales teams. Entrepreneurs’ business development is different in almost every way from large corporations, but no one has designed an approach specifically with them in mind.

For entrepreneurs, cash flow is a continuous stressor as revenue peaks and valleys are part of the business landscape—29% of businesses fail due to a lack of positive cash flow. All businesses need revenue to survive, and they need to increase that revenue every year to grow without taking on debt or selling equity.

According to trainingmag.com, training is largely deprioritized by SMBs. The average amount spent on training per individual in small- to medium-sized companies has been as low as $554—or less than .02% of their annual operating budget.

When companies spend $5,000 or more for things like a great website, but spend virtually nothing on improving the capabilities of the people responsible for generating their revenue lifeblood, the writing’s on the wall.

We designed ESS to improve conversion rates and create sales professionals who are prepared to outperform their competitors. It’s not enough to have a great sales system, it has to be easy to use and applicable across the wide variety of circumstances salespeople face. The goal of our sales training program is to move the needle by giving your team an approach they can apply immediately and affordably.

Learn more and register.

25 Nov 2014

Sticky Post By Matt Hottle Posted in Sales With No Comments Permalink

The Poor Economics of “Numbers Game” Selling

Sticky Post By Matt Hottle On November 25, 2014 With No Comments

For almost any growing business, the pursuit of top line revenue is a constant and everlasting pressure on the entire business. While your salespeople feel that pressure acutely, the entire business understands and appreciates the need to always have money coming in the door. This pressure can create behaviors that are productive and behaviors that are detrimental.

Productive behaviors can include increased teamwork in the face of a customer deliverable while detrimental behaviors can lead to heavy discounting at the end of a measurement period to hit a sales goal.

The pressure to generate revenue can also lead to economically irrational behavior. One of the most common examples of this irrational behavior is the propensity to chase every opportunity regardless of its quality or potential to actually turn into revenue. The phrase “sales is a numbers game” has been repeated by so many sales “experts” that people tend to believe it. That phrase isn’t completely wrong- only 90% wrong.

You do need to make contacts and that is a “numbers game.” When dealing with commodity products or transactional selling, numbers play a huge role in success but to distill effective selling down to nothing more than a dial-a-thon is both simplistic and costly. If a prospective lead isn’t qualified, you can waste significant time and resources and generate little revenue in return.

Historically, managers have measured salespeople on two main data points; the actual revenue generated (sold) and the top of their pipeline (how many contacts they have made). They should be obsessing over conversion percentage- how many sales they generate from a set number of potential customers.

Every prospective customer carries a cost to your organization. Those costs can be in travel, entertainment, company resources and opportunity cost. To create a simple illustration, let’s assume every prospective customer costs $1,000 to get to the point of making a decision whether or not to buy. Also, each customer is worth $10,000 if they actually buy. If your sales department makes 10 sales presentations per month and converts three of them into actual sales. The cost to the organization for these overtures is $10,000 and the sales are worth $30,000.

What if you were able to make the same three sales but only conduct seven sales presentations? The cost of the presentations to the company would by $7,000 but the sales would still be worth $30,000. The effective profitability of the closed sales increases from $20,000 to $23,000- or 15%. If this pattern repeated itself for the entire year, the total profitability advantage would be $36,000.

That improved profitability can be the difference in needing 5 salespeople instead of 6 and all the associated resources to support that extra full-time position. It can also help you rationalize your sales effectiveness and capacity.

Despite this economic reality, company managers continue to push the “numbers game,” without thinking about how conversion percentages drive increased profitability.

10 Nov 2014

Sticky Post By Matt Hottle Posted in Sales With No Comments Permalink

Kick the RFP Habit

Sticky Post By Matt Hottle On November 10, 2014 With No Comments

People are often shocked to hear I stopped participating in electronic RFPs for new business about two years ago. If it is unsolicited or where I don’t have access to the human beings making the decisions, I won’t participate. Occasionally, I’m forced to participate in one because of an existing business relationship.

It took a pretty direct conversation with Frank Visgatis, Co-Founder of CustomerCentric Selling, to realize how much time I had wasted chasing unsolicited RFPs.

I may represent the most qualified firm for the work but in the effort companies have made to rationalize vendors with electronic procurement, forced stack rankings and onerous vendor qualifications, they have also eliminated your ability to inject specific and meaningful expertise into the buying process.

Consider your own procurement process or one you have just participated in as a vendor.

What percentage of the questions were around “facts” about the business; number of employees, total revenue, sustainability efforts, OSHA compliance, etc? Based on the last few I participated in, this was more than 90% of the information requested. Who is checking all these facts for validity anyway?

How many questions revolved around “proof?” Proving expertise, capability and consistency are key to selecting partners. Proof is usually demonstrated or experienced. I have yet to see a software program or standardized form glean “proof” effectively.

Secondly, what is your win percentage in these RFPs? No padding… no excuses… what is the real number? Chances are your batting average is pretty poor. Now ask yourself how much time each RFP consumes of your organization’s time. In my own case, it was around 12 hours of sales, 2 hours of operations and 1 hour of accounting/ legal for an average and efficient RFP.

Lastly, what was your opportunity cost- the cost of chasing an unqualified RFP instead of opportunities where you could actually interact with your potential client?

I actually spent a layover figuring this out on the back of an envelope. Once I totaled it all up, it came out to $2,200 per hour.

Assuming 12 hours per RFP, that translates into $26,400. If you really want to give yourself the cold sweats, multiply that by the number of RFPs you “participated” in last year. Chances are that grand total is a gut-wrenching number.

Take heart though, there are ways to qualify your opportunities and improve your conversion percentage. At Redhawk Consulting, we work with clients that have successful sales operations but are straining their organizations to hit their numbers. In future posts, I will discuss some ways to qualify opportunities. If you have some of your own techniques to share, send them to me at matt.hottle@redhawkresults.com.