Incremental improvement of closing ratio will yield big revenue results

http://www.petevanbaalen.com/single-post/2017/10/01/Incremental-improvement-of-closing-ratio-will-yield-big-revenue-results

Attending the Hoosier State Press Association conference in September, I was fortunate enough to sit in two sessions conducted by Bill Caskey (http://billcaskey.com/). A noted sales trainer, Bill spent a lot of time on prospecting, which is appropriate since I think all sales reps need to be spending more time on prospecting. I worry that my sales team is not doing nearly enough.

Prospecting is a key to success. But before we focus on our calling on those new accounts, we have to make sure the sales staff knows what to say and do. Otherwise we are increasing activity but with no results. Caskey mentioned a stat that really caught my attention. He stated that the average B2B sales person closes between 10-20% of his / her calls. It got me to wondering how my sales staff stacked up. After some review of our call sheet activity, we're on par with that average with a few exceptions. But who wants to be average?

Most of my sales reps fell within that midrange that Caskey mentioned for B2B sales staffs. I take no pleasure in an average score because the stakes are too high. Revenue generation remains tough for all media sales staffs, especially those print centered. Training your sales team, showing their progress and keeping them focused on what the ultimate goal is has to be a daily routine for sales managers and leaders.

Your sales staff problems didn’t happen overnight, and so the solution isn’t going to happen that quickly either. Create a plan to make the changes you want to see happen, and implement that plan. The plan doesn’t have to be a total revolution. In fact, incremental changes can have dramatic impacts on results, and on your overall culture for the sales team.

In my case, the real opportunity is some basic changes that will yield big results if implemented correctly. You have the resources and data at your fingertips. Start with your sales rep call sheets. And if they are not doing call sheets or using a CRM, I would start with that change. You have to know how your staff is spending its time.

The incremental changes I want to see is an improvement in our closing ratio. Breaking down the goal and expectation is the easiest way to communicate this with the sales team. Here is the quick math:

• An average territory bringing in $30,000 per month with a 15% closing ratio and an average sale of $1,000. You can easily do the math for each territory individually, and I would encourage that to help make this a real life case for each rep.
• In this case, it takes the rep 30 customers to say yes to get $30k in a month, which would be about 200 sales calls a month with a 15% closing ratio.
• Increasing the efficiency to 20% means 10 more customers saying yes, and $10k more in revenue. The amount of work being done, in terms of sales time has not changed.

Knowing your current status and setting a goal for improvement are the first steps. But you have to make sure you are giving them the tools to actually improve that closing ratio. Each rep’s needs will be different, but I would start by answering the following questions:

• Are you doing needs assessments? Correctly?
• Do your reps make the right recommendations?
• Are you asking for the sale? — as odd as it sounds, I’m willing to bet they need a lot of practice on how to close business.

Improving the closing techniques for your sales staff will show immediate results. It will also make that focus on new business development more fruitful, by having a sales team that is focused on closing business, finding new business and doing it in an efficient manner.