With the Christmas break behind us, I'm finding a lot of people asking me 'Andy, how can I get ahead of my competition and set myself up for a great 2011?' Here are a few tried and tested ways to get drive sales in this new year.
Remember, if you don't have these exact figures to hand, use
your 'best guess' - any figure to work from is better than nothing,
and you can always adjust the figures later….
First of all, in order to prepare to have a great 2011, you need to know what 'numbers' you need to hit! This will either be a revenue/profitability figure if you're a business owner.
You also need to work out your average order value (or average profit if you're targeted on profitability figures), and then work out how many orders you need to hit that target.
Don't be one of those people that says 'I don't have an
average order, my orders are all different!' Simply take your
revenue/profit total from last year and divide by number of
The next stage is to look at what your existing customers have spent with you in 2010, and then work out what you think each account will spend in 2011.
For most people, this will involve a certain amount of'educated guesswork, however it's still an exercise worth doing as it will help you to understand how much business you think you can get from your existing base next year.
Don't fall into the trap of being overly optimistic (or overly pessimistic) - and if you really have no idea what they will spend, use their 2010 spend figure if you're in a business that gets repeat business from their customers, rather than one-off purchases.
One you have your 'existing customer' figure, take that from your total revenue/profit needed and move onto the next step….
The figure you're now left with (total revenue/profit, minus existing customer spend) is the figure you'll need to achieve in 2011 from new business.
You've already worked out your average order value, so now it's time to work out your 'average new client value'. In order to get this figure, find out how much each new customer in 2010 spent in total in the year.
The figure should 'average out' - in other words you'll have some clients that spent a lot, and some that spent little - perhaps because they only came on board towards the end of the year for example.
This will now tell you how many new clients you need in 2011 to hit your targets. Again. I'm not expecting these figures to be perfectly correct - you can always adjust them to be more correct as you go along, but at least it gives you a base to work from….
Now you've got all your overall numbers, now it's time to break down those figures in terms of activity. You'll know the critical numbers in your company of course, but the usual ones to look at are phone calls to meetings, meetings to quotes, quotes to orders etc etc.
These figures will then enable you work out how much 'activity' you'll need to do in order to hit the targets that you've set.
Once you've got these figures, you'll notice you start to feel a little more confident about hitting your targets for 2011. Now it's time for the next step…
The figures you've worked out above are based on purely'hitting the targets you've set. The next step is to stretch you a little.
Once you've got all your figures together for the above tips, work out those figures again - but this time for 120% of your target, 150% and 200% for example.
This will give you the figures (and the activity) required to hit those 120%, 150% and 200% figures (sales managers/directors normally love this part!)
Then I'd pick one of the 'stretch' targets to aim for (rather than just the 100% of target). Don't worry if it makes you feel a little uncomfortable - that's part of the process!
Now you've worked out how you're going to hit 100% or more of the targets you've set, it's now time to break those figures down.
You now want to break those yearly figures into quarterly ones, monthly ones, weekly ones and even daily ones! This will enable you to see the revenue/profitability figures you need to be aiming for - and more importantly for the salesperson - the activity you need to be doing on a daily/weekly/monthly/quarterly basis, in order to hit (and exceed) the targets you've set.
If you've done the above steps properly, you'll now start to feel more confident about hitting the targets you've set, as breaking them down usually makes people feel like they're more achievable.
However, depending on your activity levels in 2010, you might have given yourself a bit of a shock in terms of how much activity you'll need to do in 2011 to hit your new targets. However it's better to know that now that find out half way through they year when you've got less chance to do anything about it!
Once you've got these figures, it's time to move on to working out where you're going to get the business from - but that's another article! Check out this feature on cold calling to give you some pointers, and good luck with your sales for 2011!
Andy Preston is a leading expert on sales and selling, and helps individuals and companies increase their sales. You can see more about Andy at www.andypreston.com