If you’ve been following along on our blog then you are already familiar with the small business growth cycle. You also understand that each phase has a specific goal on which you must focus.
This week we want to begin looking functionally at what you should do within the survival stage. Because revenue is one of the most critical measures of growth let’s start by looking at sales.
First you need to know the goal of the survival stage is:
Consistently achieve owner established profit requirements.
With this in mind what should your sales objectives be and what can you do to begin creating sustainability within your sales operation?
Notice the emphasis on sustainability here. The small businesses that get stuck in no man’s land get stuck there because they haven’t established growth through the survival stage with an eye toward sustainability. Here are some objectives that will help you move through the survival stage without getting stuck!
Document Everything You Do
You should do this to account for everything that works and everything that does not. This will be important as you begin growing. You will add more sales reps at some point, which means you need to train them.
I often find that there is never time when you get to that point. The owner has so many things going on that they can’t get it committed to paper so that it can be shared with others. So, every sales rep ends up going through the same learning over and over. This is not a scalable sales model and slows growth.
Document what you do. Then someone can go through your notes. Organize the good stuff. List the things to avoid. Both will accelerate learning with the sales team and your sales growth when the time comes.
Validate your market research
You didn’t just run out and start selling. You did your research of the market. You looked at what the market wanted and what the competition was doing to come up with your product or service.
Sales is where the rubber meets the road. As you begin selling you’ll get real-world feedback to your research and decisions. This is another reason to document. See what assumptions that you made that were right and which ones need to be adjusted. The end result is a better marketing plan and product which will manifest itself in more sales!
Determine Your Conversion Rate
We’ve all heard the adage “sales is a numbers game.” This is very true, so you want to pay close attention to how many leads it takes to get a proposal and how many proposals it takes to close a sale. Before you start all of this is just a guess. Now it’s time to determine exactly what the “numbers” are for your business. I wrote a more in-depth post on this titled Is Your Revenue Underperforming if you’d like to get more familiar with the “how to” of sales funnel. You can learn how to set up your sales management to run by the numbers using our training program Selling by the Numbers – Creating Predictability in Your Sales & Marketing.
Learn the objections and develop ways to overcome objections
To become an entrepreneur you need to develop a thick skin as people will tell you NO all the time. You will get better with handling these no’s as you begin listening the objections people give you.
Over time you know that you’ll begin to hear the same objections over and over again. You will also develop ways to defend your position on many of these objections.
I go back to the first action. Document the objections and how you defend your position on each. Again, this helps you transfer your knowledge to others as you bring on more sales reps as your business begins to grow.
Use customers input to improve your pitch
When you first start selling, you make assumptions on why you think customers will buy. After you begin making sales you have a better source – your customers! So, ask them!!!
Most businesses are amazed by what they hear when they ask the question “why do you buy our product or service?” Get enough of the same answers and patterns emerge. If you use this information in your marketing message you’ll begin to find more customers like the best ones that you really want.
Creating Sustainable Sales
The whole point to all of these objectives is USE THE INTANGIBLE RESOURCES you have to improve your business! As you move your business up the growth cycle you will learn more about every aspect of yourself and your business. The better you become at sharing this knowledge the more it becomes part of your corporate knowledge and ultimately culture.
Most businesses that don’t find ways to share corporate knowledge find themselves reinventing the wheel over and over again. This stifles growth. You, as the owner, get dragged into things you don’t need to be involved in because nobody else has the knowledge necessary to make decisions or get the work done. Before you know it you’ve reached your limit and your business stagnates because of you!
The ideas offered here apply to every part of your business, not just sales. But, sales is where growth starts so sustainability needs to be a part of its focus. For more on this topic I recommend downloading a copy of our eBook How to Get Out From Under Your Business – Creating Sustainable Business Success.
If sustainability is critical to success, what have you begun doing begin creating sustainability in your sales function?