Helping Manufacturers And Distributors
Improve Sales Performance And Profitability
Published by the Industrial
Performance Group, Inc.
800-867-2778
Issue
No. 35

Achieve Breakthrough Sales Results in ‘06 and Beyond

Your salespeople are giving it their all, but can they do better?
We think so, and here’s why.

You’re closing out 2005 and looking ahead to new sales targets in 2006. And 2006 could be a challenging year. Many leading economists are projecting a slowing economy. The Federal Reserve continues to raise interest rates, as it zealously fights any hint of inflation.

Meanwhile, the world economy won’t wait around for us to pick up the pace. Growing economies around the world are pushing up the price of raw materials and energy. And no one needs to remind you that foreign competition is as strong as ever.
If you’re willing to reconsider some old assumptions, you can achieve double-digit growth without adding salespeople or increasing your sales and marketing budget.

But here’s the good news.

If you’re willing to reconsider some old assumptions, you can achieve double-digit growth without adding salespeople or increasing your sales and marketing budget.

The secret lies in your sales force. Think about it — your salespeople are the only asset you have that can go out and generate more revenue. It’s up to you to get the most out of this valuable asset.

Getting the most from your salespeople.

Everyone wants their sales force to be more productive. But if your salespeople are already giving 100 percent, how can you expect more?

The truth is that your sales force can do more, and they won’t even have to work longer or harder. The key is to better utilize the salespeople you currently have.

For the past several months, the Industrial Performance Group has been conducting an online survey of salespeople from various industries. The goal of this survey has been to find out what consumes a salesperson’s time.

The most troubling finding is that salespeople spend an average of 22 percent of their time — nearly one-fourth — dealing with problems and mistakes, looking for information and expediting orders.
We’re finding that salespeople work long hours — no surprise there. But a lot of their time is consumed by activities that have nothing to do with sales. In fact, on average, salespeople spend less than half their time selling. They spend most of their time traveling
or performing various administrative tasks.

The most troubling finding is that salespeople spend an average of 22 percent of their time — nearly one-fourth — dealing with problems and mistakes, looking for information and expediting orders.

This has become an accepted way of life for many salespeople. It’s driven by a philosophy of doing “whatever it takes” to keep the customer happy. But how happy can customers really be, when their key contact spends 22 percent of his or her time dealing with problems and mistakes, looking for information and expediting orders?

For far too long, companies have mistaken the heroic efforts of salespeople to make things
right, when things go horribly wrong, as a form of customer service. The problem with this approach is that it focuses on dealing with problems and mistakes after they occur, rather than preventing them from occurring in the first place.

Companies who support this “whatever it takes” philosophy are severely hindered in their ability to grow because a large amount of their salespeople's time and effort are consumed by non-revenue generating activities. The question for sales force management is, do you want your salespeople to sell, or fight fires?

The missing measurement.

At the end of the business year, many manufacturers and distributors confront that uncomfortable gap between their sales goals and what was actually accomplished — despite the heroic efforts of their salespeople.

Many are quick to blame the economy, their competition or even their customers for this shortcoming. However, in reality, unrealized sales goals are more than likely the result of how a sales force was utilized during the year. Were they selling or fighting fires?

Because of the way they measure sales performance, most manufacturers and distributors are unaware of why they are not making their numbers.

Most companies judge their salespeople in terms of productivity. In other words, how many dollars were brought in per salesperson compared to the cost of supporting that salesperson. But productivity only tells part of the story. To really find out if salespeople are performing at or near their full potential, management needs to look at sales force utilization.

Companies usually associate utilization with plants, equipment and other tangible assets. It measures what an asset is currently producing compared to what it is capable of producing.

For example, we can compare a plant’s optimal capacity to how much the plant is actually producing. This reveals how well the plant is being utilized. This same thinking can be applied to your salespeople.

The results of our survey clearly indicate that breakthrough sales results are possible, even in a slowing economy. The key is to unlock the full potential of your sales force. But don't take our word for it, see for yourself.

Visit our easy-to-use calculator to determine how your company can grow by improving your sales force utilization. Click here to access our sales force utilization calculator.

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