In my post last year, ‘Not all growth is equal’ I discussed the options for business growth. Comments from readers led me to look at sales strategy for growth. Whether you choose new products to existing clients, product expansion, or new clients with existing products, market expansion, you will need a sales strategy.
Establish your broad sales strategy and objectives
Decide how you want to position your business and your products or services. For example, if you launch an innovative new product, you could aim to sell small volumes at high prices to early adopters or opt for rapid market penetration to deter competitors.
For a new business, a key objective might be to quickly build a core customer base. Or you might concentrate on acquiring a single large customer to boost your profile.
Decide which groups of customers to target
As you build up a customer base, remember that retaining existing customers and winning repeat business is usually much easier and less expensive than selling to new customers.
The easiest new customers to sell to are usually ones who are similar to your existing customers. However, building a broad mix of customers is less risky than relying on a small number of similar customers.
Sales methods and channels
Evaluate the best method of selling to customers
Selling face-to-face is often the most effective method, particularly for complex sales, but it is time-consuming and expensive. It is usually only worthwhile for high-value sales or to build a long-term relationship with a customer.
Retail, direct mail and telesales are more cost-effective for lower-value sales. They can also be a good way of generating repeat business once a relationship with a customer exists.
Selling via your website can be the cheapest method, once the initial set-up costs have been considered.
You could opt to combine some or all of these sales methods in order to reach a wide range of potential customers.
Remember that it can take several months to build credibility and get access to a key decision-maker, particularly for high-value sales to large businesses.
Initial sales will often be the responsibility of the business principal, decide when you need to recruit a dedicated sales team
If you think the business is missing out on opportunities because of a lack of selling resources, or if you are uncomfortable selling yourself, you probably need a sales team.
The number of salespeople and the skills they need depends on how you sell, your markets and the sales targets you hope to achieve (see Sales planning).
Employing salespeople with existing customer relationships can reduce the time needed to break into a new market.
Clearly define the skills and experience you require in your sales recruits.
Give salespeople the tools they need, some form of database is essential for holding information on customers and prospective customers. Consider using customer relationship management (CRM) software.
Make selling easy
Simplify systems so that salespeople do not spend their time on unnecessary administrative chores. Use standard documents wherever possible: for example, proposal letters and standard contracts.
Involve your salespeople in the planning process
Imposing plans and targets without consultation rarely works.
Salespeople can provide up-to-date market information and suggest the best way to approach customers.
Identify the key drivers of sales performance
Externally, these will include the overall level of demand among your customers and what your competitors are doing.
Internal factors will include your marketing activities, any change in prices, the size of your sales team and how you sell.
Develop a small number of key performance indicators that will help you manage the sales team – for example, the number of new enquiries they generate, or the amount of time spent calling customers.
Make sure that targets are realistic, measurable and time specific.
Managing sales performance
Track sales progress on a weekly basis
Monitor key performance indicators and levels of actual sales. Discuss the information with your sales team.
For high-value sales, ask salespeople to assess the potential value of each sale they are working on and the likelihood of success.
Regularly review performance against objectives and budget, use feedback to refine your sales strategy and your overall business plan.