When Business Is Booming, Sales Effectiveness Often Suffers: Here’s Why

 

Photo by Irina Chishkova on Unsplash

Running a business can often feel like a rollercoaster ride. Big revenue climbs, followed by fast declines in revenues and profits. A good sales quarter may be followed by a few slow months. We refer to this as Roller-coaster Revenues. One of the reasons we train and coach salespeople is to prevent rollercoaster revenues.

What concerns me today is an all too familiar pattern.

Some of the industries we serve are struggling in times of economic uncertainty, while others, such as building and supply, defense, aerospace, medical device, and pharmaceuticals, are experiencing steady growth today. When business owners and leaders share, “We don’t need to assess the skills of our salespeople and train them; our biggest issue today is filling all our orders,” it feels like I am watching the movie Groundhog Day, where Bill Murray is reliving his past repeatedly.

I have seen this story play out for over 40 years.

 

When the phones are ringing, quote requests are filling your team’s inboxes, and revenue is trending upward, it’s tempting to celebrate and assume your sales team is performing at a high level.

But here’s the uncomfortable truth:

 

“Good times often mask weak sales fundamentals.”

 

Part of my brand, No Smoke and Mirrors, is about boldly sharing advice to help your team, even when it may make some people feel uncomfortable, so here goes…

 

“In up markets, good times, you don’t need strong sales skills to take orders.”

 

We saw many teams experience record-breaking sales during the pandemic. During the pandemic, if you had inventory and you could ship and install, and a competitor couldn’t, you had a great year. You likely secured orders from large, targeted accounts that your team has long sought to sell to. The trouble is, if your sales team has not received sales training, they will become transactional and stop selling. Many companies unknowingly create transactional order-takers out of their salespeople during boom cycles, only to suffer later when demand slows.

Today, many of the markets have normalized, and businesses are sharing concerns over key account churn rates.

Sales training and coaching, improving the skills of all your customer-facing team members, is a continuous process.

 

“Sales skills are like muscles, and they atrophy when not used.”

 

We see three issues that concern business owners in strong sales growth seasons:

First, the sales they are entering often are at lower margins and lack revenue from adding other products and services that customers require.

Second, when salespeople become transactional, their selling skills tend to weaken. They may be showing strong revenues, but their close rates may be dropping, and you are losing orders you should have won.

Third, when the market shifts (and it always does), it may take several months (or a year) of poor revenue and profits to train your sales team to sell again.

 

The Hidden Cost of High Demand: Skill Decay

When customers are calling in, product is flying off the shelves, and inbound demand is high, most untrained sales teams do dangerous things:

1. Skip the Sales Process. Reps rush to quote without properly qualifying, uncovering pain, sharing why your company, or differentiating the offer. They often fail to follow up, assuming… ”they will order when they are ready.”
2. Get Lazy with Discovery. They assume the buyer is ready, willing, educated, and able, without digging deeper into urgency, decision-making process, or budget.
3. Stop Learning and Improving. Since deals are “coming in,” reps don’t feel the need to hone their skills, handle objections, role-play them, or use the CRM effectively.
4. Fail to Upsell or Cross-Sell. As orders come in and commissions exceed salespeople’s expectations, they often overlook basic customer service, such as listening and offering upsell options. Additionally, they may fail to mention other products or services that could be sold alongside the customer’s requested order.(Often, these upsell items are at double the gross profit margins of what the customer called to order.)
5. Fail to Prospect. Top-performing salespeople prospect continuously. They know winning large new customers may take fifteen to twenty touches, and the sales cycles are often long. When salespeople become transactional, they stop prospecting. This contributes to the steep decline in revenue and profits when the market returns to a normal cycle or turns to a downward trend.
6. Fail to build business relationships. We know buyers buy based on trust and competence. We know buyers prefer to have strong relationships with authentic salespeople they see as industry-trusted advisors. Becoming a trusted advisor with large key accounts takes time and a plan. Unfortunately, in busy times, salespeople often neglect to build key relationships, instead treating each customer as a transactional number, leaving the revenue they do have vulnerable to competitors who are building strategic business relationships.
7. Decrease in Referral Revenues. One of the fastest ways to grow revenues and profits is to have a high referral network. Referrals close two to three times faster than other sales opportunities and often at much higher gross profit margins. However, when salespeople become transactional and fail to understand customer needs, treating everyone as just another transaction, customer satisfaction will decrease, and referral revenue will decline. This is when competitors you may never have considered all that strong increase market share.
8. Decrease in Profit Margins per transaction. When salespeople become transactional and do not follow a formal consultative sales process, the only thing buyers hear is price and timeline. When this occurs, your team will have circular conversations with customers, driving down your sales prices and profit margins. (Sales never shared why they should buy from your company, so your only value is price and delivery date)

In other words,…

 

“Busy hides broken.”

 

Having helped teams for 40 years, I hear someone saying: If that’s true, Mark, what should we be looking for in good times that may indicate your sales team needs to improve sales effectiveness?

 

What Are the Signs Sales Leaders Should Watch for That Indicate Their Sales Skills Are Slipping While Business Is Good?

If you’re a CEO, CRO, or VP of Sales, here are the red flags that your team is drifting into transactional sales behavior:

 

• Close rates are flat or falling, even as quoting activity increases, the percentage of quotes closed is declining.
• Average deal size shrinks because reps aren’t building value or recommending complementary products and services; they are just quickly entering orders and responding to requests.
• Sales cycles get longer due to a lack of urgency and poor qualification. Here we see pipelines full of quotes that normally would close sooner, take much longer, or never turn into orders.
• Sales reps push back on training or coaching—“We’re too busy.” They list how busy they are. Here, I want you to actively listen to what is filling their time. Are those activities what you want them to do, or could they be handled by someone else on your team?
• CRM data becomes thinner—fewer notes, less detail, fewer follow-ups. Your CRM becomes more of a data log, and no actionable insights. The salespeople, if they are entering information, enter the bare minimum as if going through the motions.
• Your pipeline becomes top-heavy, with many quotes but fewer converted deals. As salespeople become more transactional, they often skip key steps in the sales process, such as discovery, qualifying, follow-up, and closing. As I share in the qualifying skills course, without qualifying skills, they are quoting anyone who can fog a mirror.
• Large Customer satisfaction drops because salespeople are so busy that they fail to serve and build relationships with their current large customers.
• Loss of one or more large customers, since the salespeople are not working with their large key accounts as often as they should, they miss opportunities that your competitors discover. Often, these lost opportunities and declining customer satisfaction lead to lost key accounts.
• To support volume increases, smart business leaders increase hiring and watch for perceived constraints, solving them to ensure their customers’ satisfaction does not suffer. If their quotes are too slow, they may hire more salespeople, engineers, and estimators. If entering orders is a constraint, they may hire more customer service people.

 

How Do We Fight Sales Skill Decay in Boom Times?

Being busy isn’t a reason to stop selling the most effective way—it’s the exact reason to reinforce discipline and sharpen execution.

1. Assess your sales team

Are we winning due to the skills, motivations, and training of our salespeople, or is it because the market demand is high? Identify and close skills and systems gaps to increase close rates.

2. Reinforce the Sales Process

Make sure reps follow the core stages: discovery, qualification, value building, follow-up, and closing. Don’t let “quote and hope” become the norm.

3. Inspect What You Expect

Track close rates, sales stage conversion metrics, and time-to-close, especially during high-demand periods.

4. Invest in Coaching and Training

After assessing the skills of your sales team. If you identify a sales skills gap, we will prescribe training and coaching. Schedule brief but consistent skill development. Busy reps still need practice, especially when they think they don’t. I have trained and coached salespeople for over 35 years, and I have heard all the reasons why they don’t need training. However, markets shift, buyer requirements and processes change, and salespeople must constantly be improving their sales skills.

5. Use Sales Pipeline Coaching Deal Reviews as Learning Labs

Review wins and losses every week.

Ask:

“What discovery questions did you ask?”

“How did you build urgency?”

“Why did they choose us—or not?”

“ What additional products and services did we sell to improve the customers’ satisfaction?”

 

Don’t Confuse Revenue with Sales Effectiveness

If revenue is up but win rates are down, you’re gaining volume but losing efficiency—and that will catch up with you fast.

Here we see some teams adding more overhead to reduce constraints. They’ve added more salespeople and customer service personnel. Additionally, one team I helped years ago has continued to expand its engineering team to meet the increasing demand for quote estimates.

However, if your sales team lacks sales effectiveness, you will not achieve the desired ROI per person. Many of my coaching clients track revenue by employee.

Eventually, you will have to make those hard cuts that no one likes to make when business slows and/or owners want to improve net income.

When I first start helping a team, often the sales leader shares, “ Mark, I want you to help create more Barb’s. She is producing almost double the revenue of other salespeople, and she just seems to bring it each month.”

They want me to understand how Barb does it month after month and then replicate her process. They want to ensure that when they add salespeople, they have the same skills Barb has.

I interviewed and assessed Barb’s skills, and she is very likable; however, she lacks the common skills, motivations, and beliefs of top sales producers.

Upon reviewing her territory and key accounts, we discovered that she oversees some of my clients’ largest customers, spans a vast geographic territory, and has the largest customer base. However, she has not opened any new customers under her management today. She has not added new accounts in years, and her success in increasing your share of wallet with her accounts is poor at best.

Often, after we assess the skills of the entire team, we find a Jason. Jason was given an underperforming territory years ago. He scores very high in sales skills, motivations, and beliefs. He consistently hits and often surpasses all his sales key performance indicators. HE has opened several new customers and continues to increase his share of wallet in key customers. His total sales do not match Barb’s ( yet), but he is executing all the components of his territory sales growth plan.

Question for you…Do you want more Barb’s or Jason’s?

Your answer depends on whether you need a farmer or a hunter.

I would suggest we clone Jason and help Barb improve her skills to execute our agreed territory growth strategies and tactics.

 

The Real Risk: Being Unprepared When the Market Turns

When inbound demand slows (and it always does), your team must rely on skills, systems, and repeatable processes, not convenience.

If they’ve grown rusty and have a case of sales amnesia, where they’ve grown used to transactional quoting instead of selling, reacting instead of leading, they’ll struggle.

That’s when you see panic discounts, ghosted follow-ups, and lost market share to competitors who never stopped selling with discipline.

Don’t let a hot market today lull your team into bad habits and cause them to skip proven sales process steps.

Sales effectiveness is forged in discipline, not demand.

Use the boom times to train, coach, and reinforce the sales fundamentals so when the phone stops ringing as often as it is today, your team continues to create sales velocity when your competitors take a scary downward spiraling turn in orders on their rollercoaster ride.

 

Do you find that your sales are strong, and your biggest challenge is operationally keeping up with orders?

 

Has your sales team outsold your capacity?

 

Is one or two of your salespeople selling two to three times the team’s average sales per salesperson?

 

Are you needing to hire more sales, estimators, and customer service associates?

 

Has a salesperson or sales manager said, We are too busy for sales training?

 

If so, I suggest you quickly understand your customer satisfaction and assess the skills of your salespeople.

 

Improving the effectiveness of your current sales team may put hiring more salespeople on hold for now. With data, we can develop a strategy to ensure sales velocity today and even when markets slow down.

 

Let’s schedule a call to discuss this further and explore additional signs that indicate your sales teams’ performance is driven by demand rather than skills.