The Cost Of Poor Sales Performance
Fact: The majority of sales people out there are screaming for help, silently. They hide behind price objections, a lack of leads, inferior or outdated products, cold territories, and low priced competition. They fuss with smart phones, websites, LinkedIn and social media. They research research research information and talk to an average 5 prospects a week! For every ten people selling, two are bright stars, three are ‘up and comers’, three are very average, and two are in trouble. In most companies, 50% of the salesforce is ‘turnover’ bait. They are either fired, or leave for mediocrity elsewhere. The other 50% - the top half - will leave for greener fields. In today’s job jumping world, few, if any, will retire from your company. That’s real economic strain when you calculate the investment made in a salesrep.
Action: How do you make the most of who you have, while you still have them?
Is there a sales rep in your region RIGHT NOW who's in trouble? Do you think you and this person have spent quality time diagnosing the problem, and coming up with a solution? Do you have a plan? Don’t wait; time does not heal a selling problem. Avoid leading them down the path of uncertainty, because their productivity will decline. Before you act, consider the following. Do you know the cost of firing and replacing that person. It's astounding! Just add up the following dollars[4], and calculate your own.
Action: How do you make the most of who you have, while you still have them?
- Before you do anything, always have a list of people who might be interested in selling for your company. Contact them occasionally to see how they’re doing, and what they’re up to. Stay in touch with them on social media like LinkedIn. It puts you in touch with a network who could find you a qualified rep in a hurry especially if your force is expanding!
- If you have new representatives or people who have recently joined, put them through the sales paces. Have them attend seminars, listen to sales training audio online (or give them a CD or iPod to listen to while driving), read books, and speak & travel with the sales experts in your organization[1]. If it’s a new territory, don’t give them control until they have proven to you that they are ready to assume responsibility (this is especially true if they are inexperienced sales reps). Sound like a bit much? The investment now in time and money to reduce the possibility of trouble later is worth it; check out the figures below.
- If you have people in trouble now, or about to be, and you feel they’re worth the investment (most are), place them in a sales incubator for sixty days[2]. If you’re not sure about their commitment, and need to test the waters with them, place them in a one-on-one[3] training program. They’ll get direct, objective sales advice, and a boost in confidence resulting in higher sales; you’ll get an objective opinion.
- Be direct with your sales people... do not wait to tell them things that are not in line with what is expected; quite often people are relieved to hear sooner than later because they want advice and guidance. Even your experienced, top people will at times need some reminders of what it took to get them to where they are in their careers... why do you think professional baseball players have a coach at 1st and 3rd base?
Is there a sales rep in your region RIGHT NOW who's in trouble? Do you think you and this person have spent quality time diagnosing the problem, and coming up with a solution? Do you have a plan? Don’t wait; time does not heal a selling problem. Avoid leading them down the path of uncertainty, because their productivity will decline. Before you act, consider the following. Do you know the cost of firing and replacing that person. It's astounding! Just add up the following dollars[4], and calculate your own.
IssueSalary & expense; problem period ( 6 months)
Lost opportunities (25% of sales budget) Sales Manager's time/lost opportunity Headhunter & interviewing costs Training cost for new person (conservative) Lost opportunities for new person (6 months) Total cost of replacement strategy |
$1,000K Territory
$20,000
$250,000 $20,000 $10,000 $25,000 $250,000 $575,000 |
Your Numbers |
Any calculation can be argued. However, the tremendous cost of turnover cannot. Training is the single, most cost effective step your company can take towards reducing the impact of this nemesis. Take the first step and drop me a note!
[1]Ask us about our SciBiz Sales Paces Checklist© for your organization. This is a program that you control and monitor. SciBiz provides consultation and 3, one hour training, via webinar.
[2]A SciBiz Sales Incubator© is a program that consists of 4 sales bootcamp webinars (one per week over four weeks), weekly conference calls, and an optional 1 day, face-to-face, meeting. Ask for details.
[3]A SciBiz One-on-One Sales Press© consist of a minimum two days traveling together (with a SciBiz coach) and suggestions on what steps to take next. Please request information.
[4]The basis for these calculations are available upon request.
