Now I have Sarah’s sales goal for the first month and every month this year. But I’m not finished yet. The next logical question is, what does Sarah have to do every day to insure she achieves the monthly, quarterly, annual goals we’ve planned for her? What daily activities must Sarah perform to hit her target?
Here is how the statistical averages come to play. Let’s suppose my people sell, on average, one out of every three presentations they make with a potential client. That means that in Sarah’s case, I should multiply the number of sales she has to make this month by three, giving me (and more importantly, her) the number of presentations she must make on a daily and weekly basis.
How does she ensure that she has the opportunity to make the number of presentations she needs to make? The answer is to keep working backwards and use the statistical averages for your company again.
Let’s suppose that your salespeople develop their own leads by cold-calling. How many doors must someone knock on before getting one person to listen? Do you know? Regardless of what you sell, if you dig deep enough, you will discover averages that you can use to help yourself or help your team determine what it takes to achieve desired results.
At a previous company we knew that, on average, our salespeople had to knock on twenty-five doors to make one presentation. So if a salesperson’s personal close ratio was one out of three presentations then, using statistics to forecast sales, he or she would have to knock on seventy-five doors to make three presentations resulting in one sale.
Getting back to Sarah and using the above statistics, we would develop the following action plan to help her achieve her personal income goals.
| Annual goal | $90,000 |
| Monthly | $7,500 |
| First month | $4,800 |
| Number of sales ($4,000/$195) | 12 |
| Number of days selling per month | 20 |
| Daily sales needed | .6 |
| Closing ratio | 33% |
| Presentations needed daily | 2 |
| Door knock ratio (historic) | 25 to 1 |
| Door knock goal (to make two presentations) | 50 |
So in short, based on corporate averages, in order for Sarah to earn $90,000 per year, she needs to:
Knock on fifty doors per day (minimum)
Make two presentations per day
Make one sale per day, paying an average of $400 each
Work twenty days per month
From this point on, Sarah is in control of her financial destiny. She can measure her performance against corporate averages. If she performs below average on any of the critical activities shown above, we’ll know where she needs help. If she is simply not making enough presentations, she will need to increase her output in this area. If she’s making the right number of presentations but not closing at the average rate, we have to work on her closing skills.
If she produces above average, great! She can change her results by improving any or all of the statistical averages. She is in control. She is on her way to being a professional salesperson.
Do you and all of your salespeople know their statistics? Are your salespeople in control of their financial destiny? Can you and your salespeople predict within a decimal point what their sales production will be this year and how much they will earn? If your answer is yes to all of the above, and your predicted sales volume meets the requirements of your company, you are truly an asset and you can safely call yourself a professional.
3. Recruiting Salespeople
A challenge facing all company leaders and sales managers is recruitment: how to recruit, when to recruit, and which media or methods to use. No matter how you go about it, recruiting is an essential ingredient to growing sales. Let’s look at a few methods companies are using today to find sales talent.
Headhunters
At one time there were plenty of employment agencies a company could contact for the purpose of hiring salespeople. The difficulty lay in negotiating the fees.
Most employment agencies based their fees on the income the hired candidate would receive. Here is where the first point of contention occurred. If a manager told the agency that a better-than-average salesperson could earn $100,000 a year, the agency based their fee on that figure. You know and I know that while some salespeople earn top dollars, more than half do not. So if the candidate they furnished only produced enough to earn $70,000, the company paid too high a fee.
As a result, some managers would tell the agency that the earning capability was $65,000 instead of $100,000 so as to pay a lower fee. The agency would then tell potential candidates that the earning potential was only $65,000, and the company would get a less qualified salesperson—one who would be happy earning the lesser amount.
This may be why employment agencies don’t operate this way any longer. The fee structure didn’t work for anyone involved. Though headhunter companies do still exist, they almost exclusively conduct searches for management positions, and they function differently. Today employers give headhunters a description of the type of employee they are looking for, and the headhunters conduct searches for candidates who fit the description.
Can you find salespeople that way? In my opinion, based on the conclusions above, your chances of hiring good salespeople through headhunters are very low.
Help-Wanted Ads
Salespeople are routinely recruited through ads in the classified section of local newspapers. However, searching for candidates that way requires research, planning, and good copywriting skills. Why?
To really understand the challenges involved, do the following exercise. Pretend you are looking for a job in sales, and you have decided to check the local want ads to find that job. When do you look? What day or days?
Did you decide the best days to look are Saturday and Sunday? And did you further decide Sunday was preferable? If your answer is yes, why? If your answer is no, which day did you decide to look?
When I conduct seminars and workshops on this subject, the most popular answer is Saturday and Sunday, with the best day being Sunday—the day when the greatest number of want ads are in the paper. Sunday offers the most choices for employment. And most companies know that, so they place their ad on Sunday along with everyone else. What’s wrong with that?
Here is another exercise for you: Pick up a Sunday paper and scan the want ads for a job in sales. There are a lot of ads, aren’t there?
Start reading the very first ad in the sales section and go through every one until you get to the end. Do this before reading the next paragraph. Remember, you are on the honor system. I’ll trust you not to skip ahead.
If you did what I suggested, here is what happened. You read the first few ads entirely, but then found yourself speed-reading the next few. After a few more you found yourself skimming instead of reading—sliding your finger down the column looking and for an ad that grabbed your finger or your