A well-designed sales plan can mean the difference between success and failure for businesses.
A well-designed sales plan is critical for any business that wants to be successful in today's highly competitive global marketplace. A sound sales plan puts everything in writing and leaves nothing to chance. In addition to setting specific and realistic goals, it spells out how those goals will be met. At the core of any sales plan is the motivation and management of a competent sales force. The same basic principles apply to both Fortune 500 companies and small businesses.
Instructions
1. Decide whom your customer will be. You can sell products and services to other businesses in what's called a business-to-business, or B2B, model. For example, you can sell the parts and supplies used in the manufacture of a particular type of product. Or you can sell the letterhead stationery and business cards that all businesses use. You can also sell products to wholesalers or distributors who then sell them to retailers. Or you can sell to retailers directly. All of those are B2B models. You can also sell directly to consumers, such as with your own retail stores or website.
2. Analyze how you will compete. For example, you can stake out a position as the low-price provider. Or you can position yourself as the leader in quality. You can also tout your superior customer service. Despite their claims, few companies can really be competitive based on more than one or two of these key measures. Do your homework to determine the strengths and weaknesses of all your competitors -- and your own company. Then decide on a strategy based on that analysis and stick to it.
3. Decide the type of sales force you will have. For example, in most industries an outside sales force that calls on customers and prospects in the field every day is considered most effective. But it is also expensive, with travel costs prohibitive for many enterprises. As a result, many companies, especially those with a unique product or service or the lowest price in their industry, sell by phone or video conference with an inside sales force. That dramatically reduces your cost of sales. In turn, that fattens your bottom line.
4. Decide whether to pay commissions or a salary. Most businesses would prefer to pay commissions because that links outgoing revenue directly to incoming revenue generated by sales. However, many salespeople are reluctant to work on straight commission. On the other hand, paying a salary can drain your cash resources with no guarantee of success. A middle ground is a draw against commission. For example, a salesperson will get a draw of $500 per week against a 20 percent commission. At the end of a month or a quarter, the total commissions due on their sales are totaled, then their draws are deducted. The net difference is paid to them. In general, the draw against commission model is best for most businesses and acceptable to most salespeople.
5. Consider using manufacturers representatives. Manufacturers representatives are third-party sales organizations that specialize in a particular industry. They are usually paid a straight commission and bonuses for exceeding their sales quotas. Their advantage is their expertise in a specific industry and their pre-existing relationships with many of your top prospects.
6. Create incentives. The most successful sales organizations are built on motivation and recognition. Many companies conduct annual sales contests called incentive travel programs. The winners and their guests get an expense-paid vacation in Hawaii or some other exotic destination for meeting or exceeding their sales quotas. Other companies give away valuable merchandise such as a Rolex watch. Others give cash bonuses. But performance should be rewarded over and above a salesperson's regular paycheck.
7. Invest in training. A sales organization is only as good as its training. That training includes not only an in-depth understanding of your product or service, but a deep understanding of its position in the marketplace and sell it. For best results, hire a professional sales trainer to come in and train your salespeople. Few managers or executives possess the precise skills required for effective training and motivation.
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