How to unleash the hidden reserves in sales
With the growth in sales comes the growth in business — a law proven by long-standing practice. The question stands, however, what should be done to secure this growth?
By unleashing the reserves hidden in the sales department, you can increase the revenues by 5-15%.
Where are these reserves?
To find them, one has to delve deeper into the processes. For instance, some companies see no difference between a sales department and customer service. Such an illusion is particularly inherent to those large companies that have a solid list of loyal clients. Because loyal clients are the core focus of sales managers. That is, sales managers may handle accounts, close documents but leave cold calls for another time.
It goes without saying such a model is deplorable, providing for no increase in the client database or higher gains.
There are other important points to consider.
Structure of sales department
Many executives and sales managers do not fully understand how their sales department works, its areas of responsibility and the overall structure of the department. Such a confusion leads to chaos in the entire department dragging the sales performance with it. That is why every executive must outline a clear structure and ensure every manager understands his/her functional responsibilities and duties. Here are some ways to structure your sales department:
- the duties of trade representative are performed by an executive, who often acts as the head of sales, or there is a trade representative officer at the company. The head of sales has multiple trade representatives accountable to them. As a rule, trade representatives are divided by territory or commodity group. For this structure, the best industries are retail (corporate sales), net marketing, services some b2b businesses.
- classic model. For the purposes of this model, a sales manager means a store clerk, manager that answers calls and a salesman that meets with clients. In other words, a person somehow involved in sales takes the role of a sales manager. Industries: retail (answering incoming calls), services, b2b, internet shops (incoming calls);
- 3-layer model. In this scenario, the head of sales has officers on three areas: lead generation (generation of leads by means of cold calls and active sales), lead conversion (transformation of leads into sales after sales managers meet and negotiate with clients), account management (client support and administration). Industries: services, b2b (when selling expensive products or products with a long sales cycle);
- 4-layer model. This model is structured similarly to the previous one except one more expert adds to the picture — a lead development specialist. Lead development specialists come into action only after the deal is closed. They remind clients about the company over time, reinforce their loyalty and earn their trust so they make an order. Industries: car dealership, specific retail in most cases.
Every entrepreneur or executive measures a salesman’s performance by KPIs. Having a multi-layer and complex system with vague KPIs instead of having a simple one such as ‘money on accounts’ can generate 30% losses for the business. Simplicity is the key. Select one key KPI and 3-5 secondary KPIs that would support the key one.
Incentives and reward
A manager without motivation will be a weak link in your sales department. And if the reward system does not satisfy the department — a wind up is just around the corner. The incentives and reward system should be updated every half a year. Try motivating employees with salaries and percentage bonuses, or maybe even stop paying salaries and give a juicy percentage bonus instead.
Use secondary KPIs to motivate but do not forget about penalties. Always give your employees an opportunity to recoup from penalties if they cover a specific period. The sales department generates your revenues, which is why the incentives and reward system should be designed with care.
The processing speed, a well-configured phone line and document management system, website integration and the landing page — these components can enhance the conversion of applications into sales and provide for their optimization. Which brings us to the Customer Relationship Management — a software to manage a company’s interaction with current and potential clients.
Sooner or later, an entrepreneur finds themself in a situation when there is no space for their business to grow further without a properly configured CRM system. At first stages, aim for the simplest system that has many integration features. Ensure your sales department has a high-quality communication. Integrate your phone marketing with CRM.
Without scripts, no sales department will actually get any sales. Creating scripts is an art. With no experience, sense of the market and client image, you will never create proper scripts. Keep your scripts always updated as your managers try finding their individual style of sales and presales through trial and error.
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