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The Chain Reaction of a Trained Sales Manager: How It Boosts Your Bottom Line

Hey there, glad you’re joining me for this vital discussion on the often-overlooked but monumentally crucial topic—sales manager effectiveness. If you’re scratching your head wondering why your talented sales team isn’t delivering as expected, the issue might just lie with your sales manager. So, let’s dig in. We’ll go over some jarring statistics, explore the skills a top-notch sales manager should master, identify common pitfalls, and see how all this directly affects your bottom line.

The Startling Reality: Under-Trained Sales Managers

Let’s start with something that might make you sit up straight: Nearly half of all salespeople have never received formal training in sales skills. Shocking, right? What’s even more staggering is that an even smaller percentage of sales managers have received specialized training in management. It’s like letting someone helm a Boeing 747 just because they can drive a car—utterly dangerous and frankly, irresponsible. This lack of training doesn’t just create underperforming teams; it directly impacts company revenue and can make or break your business.

Skills Crucial for Sales Managers

1. Strategic Thinking and Problem-solving

In an ever-changing marketplace, your sales manager needs to be a strategic thinker. This goes beyond just hitting quarterly targets. It means understanding market trends, identifying customer needs, and aligning these insights with organizational goals. They should also possess exceptional problem-solving skills—turning constraints like budget limitations or high competition into catalysts for innovative solutions.

2. Team Leadership

The sales manager is the proverbial captain of your sales ship. They should steer with authority but also be approachable enough that the team feels comfortable sharing ideas and challenges. An effective leader motivates, challenges, and ultimately brings out the best in their team.

3. Coaching Skills

Coaching is not a one-size-fits-all ordeal. An adept manager knows how to adapt their coaching style to suit the strengths and weaknesses of individual team members. This could mean creating detailed improvement plans or offering targeted skill-building sessions.

4. Talent Scouting and Development

Great managers don’t just manage; they lead and develop. They should be able to spot raw talent and nurture it. This is a two-way street that benefits both the employee, who gains skills and career progression, and the company, which gains a more skilled and motivated workforce.

5. Sales and Pipeline Management

Here’s where the rubber meets the road. Your manager needs to have an in-depth understanding of sales strategies and pipeline management. They need to implement a system that both identifies prospective clients and nurtures existing relationships, ensuring a steady flow of business.

6. Customer Relationship Management

Sales aren’t just about transactions; they’re about relationships. Customer Relationship Management (CRM) skills are key to ensuring long-term business and upsells. The sales manager should be the ultimate brand ambassador who builds and maintains these critical relationships.

7. Performance Metrics Analysis

Data is useless if you don’t know what to do with it. An effective sales manager can translate performance metrics into actionable insights. For example, if the data shows that cold calls aren’t converting, it may be time to shift tactics and focus on warm leads or referrals.

8. Time Management

Time management is more than just a buzzword; it’s a skill that can directly impact sales outcomes. Your manager should be proficient in setting priorities and allocating time and resources effectively to meet goals.

9. Effective Communication

Communication is the lifeblood of any team. The sales manager should be an expert in both verbal and written communication. Whether it’s providing clear instructions, mediating conflicts, or just listening, good communication is non-negotiable.

10. Emotional Intelligence

Finally, the sales manager should possess emotional intelligence. They need to read between the lines, understand team dynamics, and interpret client behavior—all essential for success in the high-stakes world of sales.

Common Mistakes that Untrained Sales Managers Make

1. Micromanagement

Nobody likes to be micromanaged, and in a sales environment, this can be soul-crushing. When a manager focuses on minute details, team members often feel stifled and disengaged. This leads to a lack of creativity and, ultimately, poor performance.

2. Lack of Feedback and Recognition

It’s human nature to seek acknowledgement and approval. A simple “good job” can work wonders for team morale. Managers who fail to provide feedback or recognition leave their team members second-guessing their performance, leading to disengagement and lower productivity.

3. Poor Communication

A lapse in communication can wreak havoc. Whether it’s misunderstanding client requirements or not setting clear team objectives, poor communication can lead to missed opportunities and a loss in revenue.

4. Not Setting Clear Goals and Expectations

An unclear goal is like a moving target—hard to hit. Without clear objectives, team members lack direction, which often leads to lackluster performance and low morale.

  1. Poor Sales Meetings

Do your sales meetings inspire and help grow sales or take valuable selling time delivering no value to your team?

  1. Taking Over the Sale

Inexperienced and untrained sales managers often jump in and take over sales for their salespeople instead of providing coaching and recommendations.

The Brain Drain: Why Top Salespeople Leave

The concept that “People don’t leave jobs; they leave managers” is more than a catchy phrase; it’s backed by data and real-world experiences. In a field where the attrition rate can already be high, the loss of a top-performing salesperson is a severe blow. Studies have shown that replacing an employee can cost up to two times the person’s salary when you consider the recruitment process, training, and the time it takes for the new hire to become fully productive.

When a top performer walks out the door, they’re not just taking their skills and experience with them; they’re taking a part of your revenue and often, they’re taking invaluable customer relationships too. Moreover, their departure can trigger a domino effect, causing other team members to question the work environment and consider their options. This leads to an overall shaky team morale, which in itself is another productivity killer.

In sales, cohesion and morale are not just feel-good terms; they directly correlate with team performance and, consequently, revenue. The impact of a top salesperson leaving underlines the vital role that sales managers play. A well-trained and effective manager doesn’t just retain employees; they engage them, develop them, and give them reasons to stay, which directly enhances the bottom line of the business. Therefore, investing in a manager’s training is not an overhead but a direct investment in revenue stability and growth.

Conclusion

To wrap it up, the influence of a well-trained sales manager can’t be overstated. They’re not just a conduit between the sales team and the higher-ups; they’re the driving force that propels your sales team—and revenue—forward. If you’re looking for a scalable, effective way to improve your bottom line, invest in training your sales manager. The ripple effect of their effectiveness will reach far beyond the sales department, impacting the entire organization. So let’s stop undervaluing this pivotal role and start investing in it for a stronger, more profitable future.

If you would like to understand the skills your sales managers have and identify and close any skills gaps let’s schedule a call.

Revitalizing Your Business: Strategies for Increasing Sales and Scaling Profitably

As a business owner, you know that growth and profitability are essential for the success and sustainability of your business. Whether you are a small business owner or a CEO of a large corporation, implementing strategies for increasing sales and scaling profitably is crucial for achieving your business goals. In this article, we will provide you with some tips and strategies to help you revitalize your business and achieve growth and profitability.

Conduct a Comprehensive Business Analysis

Before you can implement any growth strategies, it is important to conduct a comprehensive analysis of your business. This analysis will help you identify your strengths, weaknesses, opportunities, and threats. Some of the methods you can use for business analysis include SWOT analysis, PEST analysis, and competitor analysis.

To prepare for a business analysis, it is important to gather as much data as possible about your business, industry, and competitors. You can use financial statements, market research reports, customer feedback, and other sources of information to gain insights into your business performance.

I often refer to this phase as running an MRI on your business. What parts of your business are strong, what are showing signs of future concerns if not addressed and what are problems that must be addressed now? What is the current state of our business today and how does this compare to our desired future state?

Identify and Prioritize Growth Opportunities

After conducting a business analysis, it is essential to identify and prioritize growth opportunities. This process involves analyzing your business goals and objectives, market trends, and customer needs to determine where you can invest your resources for the best return on investment.

Some strategies for identifying growth opportunities include market segmentation, channel development,product development, and geographical expansion. Once you have identified growth opportunities, it is important to prioritize them based on their potential for revenue growth, profitability, and market demand.

Examples of successful growth prioritization initiatives include Amazon’s focus on online retail and cloud computing, Apple’s focus on innovation and premium pricing, and Uber’s focus on disrupting the traditional taxi industry.

Develop a One-Page Tailored Growth Plan

Once you have identified and prioritized growth opportunities, the next step is to develop a tailored growth plan. This plan should outline your business goals, strategies, and tactics for achieving growth and profitability.

To develop a growth plan, it is important to involve key stakeholders in your business, including managers, employees, and customers. The one step most companies miss is conducting voice of customer research and using the insights you gathered when developing your growth plan. This collaborative approach will help ensure that everyone is aligned with the growth objectives and committed to achieving them

Some strategies for developing a tailored growth plan include market research, voice of customer research,benchmarking, transaction data analysis, sales effectiveness and improvement analysis, digital footprint analysis, net profit by customer analysis and scenario planning. A successful growth plan should be flexible, adaptive, and measurable, allowing you to adjust your strategies as needed to achieve your objectives.

Examples of successful tailored growth plans include Coca-Cola’s focus on product innovation and global expansion, Tesla’s focus on electric vehicles and sustainable energy, and Netflix’s focus on content creation and distribution.

Optimize Sales and Marketing Strategies

One of the most important drivers of growth and profitability is sales and marketing. Optimizing your sales and marketing strategies can help you reach new customers, increase sales, and improve customer loyalty.

Some strategies for optimizing sales and marketing include customer segmentation, voice of customer research, branding, pricing, digital footprint analysis, sales skills assessment , value proposition audit and advertising. It is important to use data analytics and customer feedback to continually refine and improve your sales and marketing strategies.

Examples of successful sales and marketing optimization initiatives include Nike’s focus on brand storytelling and emotional connection, Starbucks’ focus on customer experience and loyalty programs, and Airbnb’s focus on personalization and community building.

Streamline Business Operations

Efficient business operations are essential for achieving growth and profitability. Streamlining your business operations can help you reduce costs, increase productivity, and improve customer satisfaction. Here we strive for relentless repeatability.

Some strategies for streamlining business operations include process improvement, automation, process flow mapping, value mapping, outsourcing, and supply chain management. It is important to involve your employees in the process of improving business operations and to continually monitor and measure your performance.

Examples of successful operational streamlining initiatives include Walmart’s focus on supply chain optimization and inventory management, Amazon’s focus on automation and logistics, and Toyota’s focus on lean production and continuous improvement

Increase Customer Retention and Loyalty

Acquiring new customers is important, but retaining existing customers is even more critical for long-term growth and profitability. Increasing customer retention and loyalty can help you reduce customer churn, increase lifetime value, and generate positive word-of-mouth.

Some strategies for increasing customer retention and loyalty include personalized communication, customer service excellence, loyalty programs, customer satisfaction surveys, net promotor score, win/loss analysisand customer feedback. It is important to listen to your customers’ needs and preferences and to continually improve their experience with your business.

Examples of successful customer retention and loyalty initiatives include Zappos’ focus on customer service excellence and free shipping, Sephora’s focus on personalized recommendations and loyalty rewards, and Harley-Davidson’s focus on community building and brand loyalty.

Invest in Technology and Automation

Technology and automation are becoming increasingly important for businesses looking to achieve growth and profitability. Investing in technology and automation can help you improve efficiency, reduce costs, and enhance the customer experience.

Some strategies for investing in technology and automation include cloud computing, artificial intelligence, big data analytics, data dashboards and Internet of Things (IoT) devices. It is important to choose technology solutions that align with your business objectives and to ensure that your employees are trained and equipped to use them effectively.

Examples of successful technology and automation implementation include Amazon’s use of machine learning to personalize product recommendations and automate logistics, Tesla’s use of artificial intelligence to optimize vehicle performance and safety, and McDonald’s use of self-service kiosks to improve customer experience and efficiency.

Build a Strong and Capable Team

Last but not least, building a strong and capable team is essential for achieving growth and profitability. Your employees are your most valuable asset and investing in their development and well-being can help you attract and retain top talent, improve productivity, and foster a positive workplace culture.

Some strategies for building and retaining a strong and capable team include employee training and development, performance management, compensation and benefits, training managers to coach and work-life balance. It is important to create a culture of open communication, collaboration, psychological safety, and accountability, and to recognize and reward outstanding performance.

Examples of successful team building, and retention initiatives include Google’s focus on employee well-being and innovation, Southwest Airlines’ focus on employee engagement and customer service, and HubSpot’s focus on employee autonomy and learning opportunities.

Conclusion

In conclusion, revitalizing your business requires a holistic approach that involves conducting a comprehensive business analysis that feels like you are running an MRI on your business, identifying and prioritizing growth opportunities, developing a tailored growth plan, optimizing sales and marketing strategies, streamlining business operations, increasing customer retention and loyalty, investing in technology and automation, and building a strong and capable team.

While the strategies we have discussed in this article may require time, effort, and investment, the benefits of achieving growth and profitability are well worth it. By acting and implementing these strategies, you can revitalize your business and achieve long-term success and increase shareholder value.

So don’t wait any longer. Start implementing these strategies today, and watch your business thrive and grow.

If you would like my help getting started or coaching throughout the journey, let’s schedule a call.

Voice of Customer Finds “Sales Secret Weapons”

 

 

 

In my last series of posts I have been sharing how powerful capturing the voice of your customers (VoC) and voice of your market ( VoM) is in growing your business profitably. In this post I will share how to leverage customer voice into a “sales secret weapon“.

 

In my last post I shared how critical it is to understand the criteria your buyers use today as well as how those criteria rank in order of importance. You may be providing services and features that cost you margins that your customers no longer value. Or, you may be leading with a dated value proposition and not sharing the most important buying criteria your buyers are shopping for today and losing sales you could have won.

 

First we need to meet with our customers and prospects and understand how they shop, the buying journey they take, as well as the key criteria they must have to make a purchase. With out this information your sales team is playing what I refer to as: “feature and benefit BINGO”. They are calling out features and benefits in hoping the buyers jump up and say… yes, I need that one…BINGO! In this sales model you are relying on your buyers to figure out the problems you solve, or could solve for them. In todays market you must intentionally share the problems you solve for your customers.

 

Sales teams who have been trained to understand how buyers buy, what they need to buy, and are equipped with the right sales tool for each twist and turn in the buyer journey win sales.

 

I read an interesting article in Adweek this week concerning how sports teams use various give away items to increase ticket sales as well as encourage fans to arrive earlier to the ballpark. Fans who arrive early spend more money; it’s as simple as that.

 

What does ballpark giveaways have to do with your business?

 

Great Question!

 

Please answer the following questions:

 

What buying criteria must your buyers have today to buy?

 

What is the order of importance for these criteria?

 

How does your overall service offering compare to what buyers want and need today?

 

Some common giveaways I see companies offering include:

 

  • Time of shipment
  • Service level
  • Free freight or FOB freight
  • Payment terms
  • Packaging specifications
  • Quality specifications
  • Added value engineering
  • Marketing tools
  • On line order entry/ EDI
  • Customer sales force training
  • Technical support
  • Material recommendations
  • Discounted material costs based on your total buying power
  • Returnable freight packaging
  • Quality guarantees
  • Out going product inspection
  • Product testing

 

The list can go on and on based on your specific industry.

 

Based on your industry you have heard a number of requirements from buyers. Obviously the job of a buyer is to ask for as much as they can receive for the lowest price. The trouble occurs when your salespeople do not understand how they key buying criteria rank in order of importance for your buyers.

 

Market leading sales teams are trained to ask.

 

What I have observed more often than not is sales teams spill their candy in the lobby. They “show up and throw up” until the buyer agrees to buy. It is not your sales team’s fault. They are trying to use the tools they were given. My challenge is what if you could have sold the buyer with the ability to execute three key buying criteria and not all 12-15 your salesperson listed? If this occurs your team is incurring costs and performing features, benefits and services that are costing your team margins and are not of key value in the buying decision today.

 

For example I mentioned the recent AdWeek article. In this article it shares how major league baseball teams have taken the time to understand the voice of their customers, the fans, and in doing so identified a direct sales increase on the game nights they give away bobble heads. Bobble heads produce more results than any other giveaway.

 

Major league teams have given away all kinds of things (just like your business may be doing now) in the hopes of increasing ticket sales and getting consumers to arrive at the ballpark earlier. Things like tote bags, T-shirts, baseballs, baseball cards, towels and bobble heads.

 

When fans arrive earlier, they spend more money. It’s as simple as that.

 

The article shared the following:

 

  • Bobble head giveaways increase ticket sales 15%-30%
  • The Cubs realized a 71% increase in fans arriving more than an hour before the game

 

What I like about this information is it is simple, quantifiable and easy to execute.

 

What impact could your sales and profits see if you identified your one to three top “bobble heads” secret sales weapons your buyers need to buy today?

 

Do you agree how powerful this information would be to increase sales and profits?

 

With this kind of focus do you feel your team could execute in delivery? (I bet they can)

 

The trouble with most businesses today is they are providing a laundry list of features, benefits and services and are often not sure the top one or two that truly drives sales behavior. So what do most teams do? …. They offer them all. Just like giving away tote bags and baseballs fail to move ticket sales dials, your team may ( more than likely is)  giving things away that buyers do not value today, or do not value as much as they did in prior years.

 

How can your team know what buyers value today?

 

Capture and leverage voice of the customer and voice of the market.

 

How about your company….

 

Do you know the key buying criteria your buyers must have today?

 

What are all the features, benefits, and services your team is offering to win sales today?

 

What impact would just offering what buyers need today have on your operations efficiency?

 

What impact could knowing and ranking buying criteria have on your teams’ sales close rate and gross profit margin?

 

What additional profits could you realize by eliminating things no longer high on your buyer’s key criteria list?

 

What is your team’s one or two bobble heads that really drive sales growth?

 

I have helped companies increase sales and profits for over 30 years. I wish it was some crazy technical secret process but it really is not. If you take the time to understand your customers, capture their voice and leverage what you learn you will see what I refer to as explosive growth.

 

Why?

 

Simply put, most companies you are competing with have salespeople showing up and throwing up. They are verbally vomiting all kinds of promises to win the sale. Some are important, some are industry standard performance requirements, and some are no longer a value, and some are dated based on how we have always done things around here.

 

If you have not captured the voice of your buyers and market in the last 12 months I promise you …

  • Your sales process is broken
  • Your team is giving away things buyers no longer value
  • Your team is losing sales you could have and should have won

 

Once you capture the voice of your customers you can leverage that knowledge into a repeatable sales process  ,sales tools, and sales training that guides your sales team based on what your buyers value most today.

Customer voice helps you create your own repeatable sales process  GPS  for your sales team to close more sales profitably.

 

 

 

Are Your Salespeople “Growing a Market”…Or Working a” Bread Route”?

Are Your Salespeople “Growing a Market”…Or Working a” Bread Route”?

A common concern I hear from business owners is their salespeople are not effective at selling net new customers. New customers, if serviced properly become lifetime customers with current and future revenue opportunities and contribute to creating sales velocity. In addition, they make up for account attrition, you know …customers who go out of business or just go away. (another future blog needed as customers do not “just go away”) New customers result in additional commissions for the salesperson right? Since new customers are so key to every businesses current and future sales revenue goals and can add additional commissions then why are sales people not closing new customers?

One of the leading reasons I have personally experienced why salespeople are not growing their markets is ; they are working a bread route.

As I have shared before one of my first jobs was a route salesman with Frito-lay. Fresh out of college I drove an 18 foot step van full of Frito-lay products to my grocery stores, convenience stores, bars, and anyone else I could open. Frito-lay made the sale of new accounts one of my key indicators along with selling additional store placement displays and gaining shelf space. The one route sales guy who would beat me to my grocery store accounts was the bread route delivery person. They would always amaze me at how fast they could get in and out of a grocery store and move on to the next account. They started very early in the morning like me, but were often done with their route by 2:00 pm. The bread route driver was focused on visiting his current accounts, accounts he and his company have relationships with, finding out what they needed and filling the shelves. They had very specific routes and timelines and if the driver executed his or her route effectively they made a good living. The bread route driver made enough income serving his current customers that he did not need to open new customers.

Fast forward to today and I see bread route drivers in all kinds of businesses. These are salespeople who call on a bank of current customers who should need additional products and or services and if they work their route they should meet their personal income goals. Current customers are the easiest to deliver products to because you and your company have a relationship with them. They welcome you in, if you ask for an appointment they make themselves available…heck, they even reply to voice mail and emails!

Selling new customers requires connecting with new people you do not know, new companies you may not be failure with and risk. No salesperson likes rejection and every time you attempt to start a discussion with a potential customer, (someone you could sell but you are not currently selling) you risk rejection. In addition, since you do not have a relationship you often experience frustration through a lack of returned phone calls and emails, trying to get past the gate keeper, trying to determine the buyer’s process and criteria and so on… all the while needing to make your sales objectives (and commissions).

So how do you know if your salespeople are growing their market or working a bread route? I have a few questions…

  1. How many net new clients have they added in the last 6 months, last 12 months?
  2. What % of their monthly commissions is the result of net new customers over the past 6-12 months?
  3. If your salespeople report on sales calls, what % of calls are net new potential customers?
  4. Do your salespeople have “everyone” in a particular market that has ever bought from you? Or do they have a fraction of the total number of accounts?
  5. When you conduct four-legged sales calls with your sales people, do they take you around to current customers and drive by a number of potential new clients, or do they add net new targets along the way?

So what’s your gut telling you right now? Are your salespeople working a bread route or growing your market? How did your team score with the above questions? Below is how I have viewed the responses to the above questions when I have helped clients.

How many net new clients have they added in the last 6 months, last 12 months?

I monitor the number of net new clients. As a general rule and can vary based on the maturity of your industry and the frequency with which your team introduces new products….if a salesperson is not adding at least 5% of their total number of customers every six months, ….they are working a bread route.

What % of their monthly commission is the result of net new customers over the past 6-12 months?

In addition to the number of new accounts I look at the revenue those accounts contributed and also how that revenue grew the salesperson’s commission. Again whether or not you have a history of launching exciting new products designed to solve the markets unresolved problems or new product flops , the maturity of your industry, the experience and training of the salesperson…I look for at least 5-7% (ideally 10 %+) of commissions coming from customers they have opened in the last 12 months…if they have little or no commission from new customers…they are working a bread route.

If your salespeople report on sales calls, what % of calls are net new potential customers?

Winning new customers requires a great deal of activity. I am not however advocationg activity without focus as I have discussed prior as another problem salespeople often encounter.  The rule I have used in multiple industries is 20 unqualified prospects should turn into 10 potentials, and from that 10, 2-3 proposals and 1 new customer. If your salespeople are not trying to connect with at least 20 new accounts per month ( 5 per week) ….they are working a bread route.

Do your salespeople have “everyone” in a particular market that has ever bought from you? Or do they have a fraction of the total number of accounts?

If all your customers are lumped into one group and not segmented based on key accounts, targeted growth accounts and you have not identified targeted net new accounts… they are working a bread route.

When you conduct four-legged sales calls with your sales people, do they take you around to current customers and drive by a number of potential new clients, or do they add net new targets along the way?

I enjoy working with salespeople in the market. I enjoy interacting with salespeople, their customers and potential new customers. If you work with your salespeople and they take you only to happy customers and drive by potential net new clients and have not started or attempted to start discussions with them…they are working a bread route.

So how did your sales team fair? Are they growing a market or working a bread route?

As long as they hit their sales numbers do you care? Should you care?

If your salespeople frustrate you by poor execution in closing new business, it could be because they are working a bread route. In my next post I will discuss how to change that behavior and drive net new customer revenues for your sales team.

The Toughest Sale an Entrepreneur Can Make….Investment Capital to Grow

 

I enjoy sales, I really do. I see sales as the ultimate example of serving others. You connect with people in your market that may have problems your product or service can solve, and you help them solve their problems. For me it’s the ultimate rush helping clients solve problems they have struggled with and felt they must learn to live with. However there is another sale entrepreneurs have to make that is not nearly as fun and can be emotionally and physically taxing if you do not know what you are doing…raising investment capital.

Typically the companies I serve have the capital and or are self funding and I am asked to create a repeatable sales process, based on how their buyers want to buy. Then I train their team how and when to use the sales tools we create for each step of the new sales process. In one instance however, a company I was asked to turn around lacked adequate access to capital to truly scale the business. So I approached raising investment capital as I would any market with various buyer personas , but in this case what I was selling was the viability of the business and future potential. I found there are basically five ways to fund your growth and each has its own characteristics, requirements, needs and challenges. Over a three month period while out making sales calls with customers, I met with as many “potential buyers” for funding as I could to understand  shape and I even named my buyers, my ways to raise funds.( I had way to much car time, so stick with me)

Self Fund through sales revenue – “Willy Lowman”

 

State and Government Grants – “Annette to detail”

 

Friends and Family- “Have-I” , as in have -I got a deal for you

 

Angel Investors- “Michael”, like the archangel

 

Venture Capital –”Barbra”, from the show shark tank

 

The first I called “Willy Lowman” from Death of a Salesman. You are out chasing revenue, cold calling, following up on every potential lead, and networking like crazy. You bootstrap your way, working 12-14 hours a day meeting with clients who could provide that next big order. At night you stuff envelopes with letters and brochures, and scour the internet using social media tools searching for the right contact to speak with at your future targeted accounts.

Characteristics– You often find yourself bunking on friends couches and driving great distances simply because the meetings need to occur but you lack the capital to afford air flights and hotel rooms. You have a passionate connection to your product and you have the ability to sell convincing presentations that drive early orders. You may hire independent sales representatives to sell your product on straight commission, but quickly find they too require time, your most precious asset at this point.

Requirements – You have to be skilled at taking inventory of what you have to work with and leveraging it to the best of your ability while always being cognizant of the businesses cash requirements, cash flow. You personally will do without.  You need tenacity, good old fashioned (excuse the expression)… “piss and vinegar”. You will have many doors slammed in your face and you will need the ability to press on in the face of adversity. You know the “right” way to get orders, but you lack the capital today, so you do what you need to do. I have 50 other ugly truths in my eBook you can download off my blog. You have to possess the ability to create learning’s through each transaction and adapt quickly.

Need – samples, sell sheets and a clear understanding of the problem you solve, and who potentially has that problem. With some of the software out there today and help from friends in your network you can create some professional presentations and sell sheets. You must have a web site.

 

Caution – it’s not unusual to start a business this way trying to sell your way to success, however know that it is not for the faint of heart, and if you do it for too long you too run the risk of going nuts like our buddy Willy. If whatever you are launching cannot gain traction and begin to result in predictable sales revenues within 12-18 months, cut bait! Chances are you are pushing mud uphill and you have not answered one of the four questions with a yes.

So how about you…have you launched a business on shear tenacity? How did it turn out?

 

As you look back, how long were you in the bootstrap mode? (Or are you still in it?)

 

What did you find the hardest part of this phase?

 

What advice would you give someone who has desperately tried to scale their business, their dream for 18 months with no success?

The key to funding I have learned over time is to truly understand where your company is on the business growth continuum. Is your business pre-cash, do you have a few customers, some revenue… but needing capital to scale, ….?

Once you clearly understand where your business is, you can connect to the right kind of funding. As you move from self funding / friends and family to Government Grants to Angel investors to Venture Capital, you must clearly understand where you are at and what your buyer (investor) requires.

What I have experienced is friends and families are investing more in you and your abilities than the business. They are looking at your past success and your personal abilities. They have a personal relationship with you.

Government Grants/ other Grants are focused on answering a specific issue. You must be skilled at writing grant applications and clearly answering how your product falls into their grant offering.

Angels fund from small $20k investments up to $2 million from larger angel funds. Angel funds are groups of angel investors who pool their monies and invest in companies. Sometimes members of the fund may also wish to make “side car” investments in addition to the fund investment. Angels focus on;

  • proprietary product and or technology
  • leaders ability to lead organization, monetize opportunity
  • the market and your product solution’s potential
  • your team and its ability to execute
  • your exit plan, who would be potential buyers, or do you plan to go public

Venture Capital traditionally invests in opportunities over $2 million. They are industry specific and the cost of their funds in terms of equity in your business is often much greater. They are focused on return on their investment. They have specific business valuation models and your engagement with them will feel more like a business transaction than a relationship. VC’s will receive 1,000’s of pitches each year and only work with a select few companies that match their criteria. I recommend you watch the show Shark Tank and pay attention to the discussions, the interaction as it will prepare you for possible discussions you may be having should you pursue VC funding.

If you are an entrepreneur and feel the next step to truly scale your company is funding, make sure you understand where your company is at, and what type of funding source best matches your needs. If you are like me, you will find it the most challenging sales process you have ever experienced!

Customers Are Not Your Best Source of Information To Grow Your Sales?

When companies desire to grow their sales they often reach out to their customers to find what they could be doing to grow their business. The trouble is your customers already have a relationship with you. They heard and understood your value proposition enough to buy from you. You need to speak with them; however you must also meet with those who did not buy from you.

If you really want to grow your sales you must speak with potential customers and those your team has quoted. Since they never bought from you they are more likely to not overlook your clunky web site navigation or your salespeople who showed up and threw up without ever understanding the problems the buyer needed solved. They may tell you your brochure is a great explanation of who you are, but fails to tell the buyer the problems you solve for them.

Look at this another way…of the conversations your salespeople have each day…which is greater …the people who say yes…or the people who say no? Let’s say your salespeople close 15% of leads. Doesn’t it make sense to have a focused understanding of why the majority of the people your salespeople speak with say no? As well as what you need to do to help them say yes? Chances are your current customers have the same issues and your overall buying experience and customer satisfaction will improve by adding those who do not buy when you do your market intelligence.

Who does your team speak with when they want updated market info? Just your customers?

Who does the interviewing?

Why or why not should salespeople do the interviewing?

Have you used this process? If so please share what you learned?

“Pushing Mud Uphill” …Launching a New Product or Service Without Four Clear “Yes’s”

launch new products like pushing mud uphill

One of the most exciting things you can do in business is launch a new product, service, or entire business for that matter. As high as six out of ten US adult consumers are thinking about launching a business at any given time. If you chose to take the leap yourself, you will experience what I refer to as the “50 ugly truths…” but in so doing you will become stronger, and if you survive you will ultimately help people solve problems.

I can’t imagine anything more rewarding than helping someone solve a problem they thought there was no solution for. If this is true, then why do over 70% of new products (businesses) fail?

They fail because they failed to answer “yes” to four simple but key questions.

Question 1

Do you clearly understand the problem you are trying to solve and does your product (service) solve that problem completely? (if you have already said “no” stop, gather more data)

Question 2

Are there enough people, a market of people, with this problem to meet your desired ROA? ( if your answer is “I think so” stop and validate)

Question 3

Do the members of the market you validated as big enough have the ability to pay to solve their problem? (there are all kinds of problems we all have, but we are not willing to pay to fix)

Question 4

Are the members of the market you validated that is big enough, with the problem you solve, and ability to pay, “willing” to pay now? (there are many problems we have, and we have the ability to pay for, but not the willingness to pay for)

If you answered “Yes” with current market data (not data from three years ago when you first came up with this idea) go for it!

But remember; An Idea is not a product and it’s definitely not a Business.

Where most entrepreneurs blow it …as Jim Collins refers to it is; Hubris. They believe because they have launched products in the past and they were very successful they trust their gut and intuition that there new endeavor will also be a huge success.


So what happens if you launch based on emotion and Hubris?….

Your sales may come, but slowly

You will miss ROA targets

Need to add investment, instead of cutting bait

Your sales team (who trusted you) will push mud uphill each day…the good ones will leave due to frustration

You strain your entire organization (who is probably already multi tasking) morale suffers

You demonstrate to your market you do not know them

Personally you will become frustrated, aggravated, distracted, and you will loose focus

How can I rattle the above off so quickly?…Because I have done it. I have experienced the rush of growing companies by launching new products and or new divisions and when I find what feels like a huge unsolved problem in a market ….I get excited (emotional).

Instead of gathering current market date, I used to move into; validate my gut mode.

Instead of admitting what I did not know… and finding answers…I relied on past experiences to get me through the unforeseen roadblocks.

I have felt the emotion that builds, and heard that little voice in your head that says; “I don’t care what engineering, marketing, operations, and sales thinks we should do, or the more information they want to gather…we need to launch before someone else beats us to market”

What I lacked back then was a filter…simple filter that quickly cuts through the emotions and feelings and quickly lets you know if you have an “idea” or a “business”. The above four questions are the filter I recommend everyone use PRIOR to launching your new product, service, or business.

How about your company….

Have you ever had to push mud uphill?

While your team loyally pushes mud uphill, what is the opportunity cost of their time?

Do you have other questions to add to the filter to insure the products you launch do not fall into the 70% of those that are an expense without a ROA?

Again, having launched products, services, even new businesses in my career I understand that inner rush of adrenaline that makes your creative juices fire on all cylinders…I do. Maybe it’s an age thing…but I now highly recommend a pause, a strategic pause, before you launch and ask yourself the above questions.

To insure you maximize your percent of wins and your ROA for new products, make sure you use a filter, get the four “yes’s” prior to launch.

If you do not use mine above, I have also used the economic value added model back in the day. This model helps insure decisions are not made of Hubris.

Whatever you do, do not rely just on your gut, and or your key accounts, friends, and family members saying “go for it”.

If you would like to read more about this topic, I recommend you read;

Tuned In

How the Mighty Fall

Delivering Happiness

Don’t Kick Your Salesperson’s ASS, …Help Them Find Their Number….

 

One of the easiest things a sales manager, (business leader) can do is resort to a; “boot on the throat”…” a throat to choke” ….and “Ass Kicking “mode. After all it takes very little effort, knowledge or skill to be a critic and a bully.

True leaders help train and motivate their teams.

 If your desire is to hit and surpass your sales objectives….Help your salespeople “find their number”.

I see it all the time, a new product launches or a new sales goal is distributed to a sales team and the key performance measurement: Sales to plan is not met. The easy route is to start “Ass Kicking”. You know …the weekly and by weekly conference call thrashings in front of their  peers. The sales update calls at 5pm on Fridays that last until 7pm. The “contemplation of your navel” market reports on why they can’t hit their sales numbers and their future action plan to change the results.

Yes this may drive some momentary, fear driven results, but this is not how you create sales velocity. In 99% of the cases I have been asked to help figure out why sales objectives were being missed it was not lazy salespeople who needed their butt’s kicked. A frequent cause was poor (or a total lack of) sales training. In these cases struggling salespeople are told to “stop making excuses and just make it happen, figure it out”. However the reality is the reason your team is missing numbers can be traced back to your understanding (yes you) of your market and buyers problems, buying criteria, and buying process.

Sales velocity is sales increases with direction and momentum and it is never driven by fear.

If your salespeople are struggling with sales, particularly new product sales and or new business sales my advice is to stop… the beatings as the morale is not improving and “help your salespeople find their number”. Their number is how many rejections they have to experience to have a win.

For example at one time in my career I ran business development for an ad firm. After tracking my calls I found my number was 18. If I made 18 calls I would get 2 appointments and from those two appoints I would close 1 new account. Instead of dreading the call process it became a game. Each rejection meant I was one step closer to a yes. Over time I also tried to improve that number.

A couple of funny things happen when you track how many rejections your team receives;

First, they make more calls. More calls mean more opportunities to win, more opportunities to start conversations.

Secondly, if your sales team has been properly trained on how to listen to buyers, determine their unresolved problems, and they understand the problems your product solves….you will have a number of net new potential clients dropping into your marketing funnel. Some of these accounts may not buy for 12-14 months, but if you compliment your calls with a lead nurturing campaign you have a high probability of closing them when their problems, (their pains) become unbearable.

As the leader you must listen to your team and look for diamonds as far as what is working and share it with your entire team. In addition you must look for common reasons sales do not occur and work with marketing to create sales tools for these common roadblocks in the flow of the sales process.

So do me (and your sales numbers) a favor …

Track number of rejections for each team member for 60 days. Gain an intimate knowledge of common reasons buyers are rejecting your salespeople.

 

Have your salespeople report on their number of rejections each week and you will see more net new sales and your marketing funnel will increase exponentially to help your future sales numbers.

Or go ahead and Kick Some Ass….it sure worked when you were a salesperson right? …Oh it didn’t? It actually made you feel like a number, and you lacked a loyalty to that manager and or company? Or you left that team, that idiot boss and now you lead the competitor’s sales team?  Interesting…did the ass kicking make you seem desperate to your accounts at the time and the deals you did close were below your targeted profit margin? Hmmm…so what makes you think “Ass kicking” makes your team feel any different?

Does your team track number of rejections?

 

Does each of your salespeople know their number?

 

Does your organization use those individual rejection numbers to identify team member who need training?

 

If you are in sales, do you know your number?

 

Do you find when the pressure is on salespeople chase new business differently? Are they making things up on their own? Making promises your product or service can never achieve?

You always have a choice.

You can “let the beatings continue until the sales and morale improves”….’let the Sh@t flow down hill…”or you can chose to lead your team. You can help them, motivate them to make more calls, and clearly understand your market, buyers, and have a record setting year.

Do I need a Passion Statement for my business? Take the short quiz…

 

 

As I discussed in my post : Want to Jump Start Sales and Morale? Write a “Passion Statement” For Your Business…. A passion statement will jumpstart your sales and improves your team’s morale. Business leaders often spend a great deal of time on mission statements, their unique sales proposition as well as their stated team values. These are all needed , however nothing unties a team and inspires your buyers to buy like an authentic passion statement.

So how do you know if your organization needs a passion statement?

Please answer the below questions with the first answer that comes to your mind.

What I am looking for is your feeling more than an answer you spend time rationalizing.

  1. Do your customers perceive your product as a commodity?

  2. Has your overall gross profit as a % of sale decreased in the last 6 months?

  3. Do your team members work 9-5, no more, no less?

  4. When you work with salespeople in the field do you discover your key accounts are purchasing products from competitors because they were not aware you carried them?

  5. Has 50% or more of your sales team missed their goals over the last 6 months?

  6. Do your competitors always seem one step ahead of you with new products or services?

  7. When you launch new products, do they miss their ROI targets?

  8. When you review the performance of your last 3 new products would they be categorized as “evolutionary”? ( instead of revolutionary)

  9. Is you employee turnover greater than 20%?

  10. Have you lost one or more of your Key accounts in the last 6 months?

  11. Has your AR increase by 10 or more days to collect?

  12. Do your salespeople complain your products are significantly priced higher than competitors?

  13. Are salespeople listing features you must build into your product to make the next sale?

  14. Are you frustrated that your team does a good job of identifying roadblocks, but fails to develop plans to break through them?

  15. Have you ever said…” I am frustrated; I want my team members to act like owners and not just employees”.

  16. Have you lost a key employee over the past 3 months unexpectedly?

  17. Are you having difficulty identifying and recruiting new team members?

  18. Do your team members have more than 3 key performance indicators you evaluate them on each week?

  19. Is more than 3 hours of your week in meetings?

  20. Do you feel the need to create weekly objectives and activities for your subordinates, and “manage” them closely?

 

Here’s the deal….if you said “Yes” to more than 5 of the above you and your team need a quest, you need a passion statement to jumpstart your business.

If you answered “Yes” to 10 or more you are already on the slippery slope of becoming a Market Loser.( take corrective action now!)

 

How does your organization answer the above questions?

 

Based on your answers do you need a passion statement?

 

How do your clients describe your team and your products when you are not around?

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