Every company has to have sales. Most companies have a sales team, however very few companies have a true sales system. Unfortunately without a sales systems companies are not able to sustain themselves during downturns or pursue aggressive growth trajectories. The reason that most companies don’t have a sales system is because there are significant barriers to entry in time, money and talent.
The Ammo: While there are sales people that can close deals with their bare hands, they are rare, expensive and often temperamental. The first step in building a system is to develop the necessary marketing strategies and materials. Marketing is the ammunition of sales. The important pieces in your arsenal are having a defined product, price, placement and promotion. Once you have the basics down, I recommend developing your most important piece of collateral, your business card. Once you have built your marketing arsenal, the next step is to develop your sales strategy.
The Strategy: The key to developing a sales strategy is to make sure you understand the factors that determine the capacity of your sales pipeline and how much cash flowing through it at any specific point in time. For example do people purchase your product on a daily, weekly, monthly or quarterly cycle. To keep your sales strategy grounded you need to develop and test a variety of hypotheses. If you want help developing your sales strategy check out how we can help your sales team.
The Tools: A Customer Relationship Management System is the most important tool to building a sales system, because in addition to allowing your sales team to track their prospects, deals, tasks and cases, the data from your CRM can be used to influence your operations, customer service and marketing efforts. For more information read Why and How to Use a CRM. At CAN we use 37Signal’s Highrise.
In addition to the Highrise CRM we also use the following tools as apart of our sales systems:
- Easy Virtual Meetings: When you request a meeting with a client you want to make joining the meeting as quick and simple as possible. At CAN we use Glance.net for virtual meetings, because the software is ridiculously simple and requires virtually no resources from our clients or their computers.
- Contract Management: At CAN we use EchoSign to make it easy to send contracts, our clients to sign them, and to store them. Even if you don’t process hundreds of contracts a month, EchoSign can be an essential tool, because it eliminates any hassles/excuses keeping your clients from signing your contract right now. At the end of the day a prospect only becomes a client when they sign on the line that is dotted.
- Coordinating: In order to know what to promise and ensure that their promises can be fulfilled Salespeople need to be able to coordinate with Operations, Customer Service and Marketing. At CAN we use Skype to handle informal meetings and communication between salespeople and other departments.
- Standardize Customization: Customers like and often require customized marketing materials, communications and contracts, however it is not economical to create everything from scratch. At CAN we use Backpack to keep clean copies of all of our standard marketing, emails, and contracts, that salespeople can download and customize for each client.
- The Moneyboard: At CAN we use Geckoboard to keep the important numbers in front of our sales team at all times, letting them know how much money we need to bring in in the next 15, 30 and 60 days, what money we need to collect and what opportunities are about to close.
The Incentives: The first step when building your sales team is to develop and fine tune your sales structure and incentives. Most people become salespeople because they are hunters and respond well to direct incentives. It is important to strike the right balance between salary and commissions. In addition to having your salepeople be invested in your success, it is important to have them know that you are invested in their success. You want to provide your sales people with enough of a base that they aren’t distracted or pressured to close unqualified prospects. However, you also want your salespeople to be incentivized to close deals and be invested in the future of your organization. A basic rule of thumb is to set someone’s base salary just below their cost of living, and set their commission rate so that if they sell an average number of contracts they will receive an average total compensation when compared to other professional positions.
The Team: Some of the best sales management advice I have ever received was to make your first sales hire a sales manager. However, hiring a sales manager is no easy task. If you hire someone who is a good fit for your organization they will hire, train, and lead your sales team to victory. However, if you hire the wrong person for your organization, industry or product, they will quickly dry up your coffers and leave you for dead. They key is to carefully understand the drivers of success in your industry, carefully craft your job description and screening process, and actively avoid hiring a false positive.
Sales Managers are not necessarily the best sales people, but instead are people that are able to consistently execute a specific sales system to produce reliable results, and have the willingness and ability to train others on their sales methodology. Other than that what you look for in a sales manager should be unique to your company, product and industry
The Targets: Once you have everything built it is time to aim your sales sales system at your ideal client. Narrowing your sales on a specific target can be challenging, however without a clear target or directive it is nearly impossible for your sales people to achieve their goals. Also, setting a specific target will also help your sales team avoid wasting time on unprofitable, unloyal or inactive prospects that are not likely to purchase. For companies with thousands or millions of customers a mathematical system is essential to segmenting clients and determining the drivers of profitability, loyalty and purchasing activity. For companies with hundreds of customers one of the easiest, quickest and cheapest way to build a sales target is to have your sales people describe their 5 most recent closed sales, and look for patterns in demographics and psychographics.