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“Old” Sales Principles
We have been informaed by our delegates that several low cost training suppliers out there are still referring to out of date sales strategies and principles in their sales training courses and associated training literature. Whilst such strategies and principles may have bee successful in the past, they are no longer relevant for the successful conclusion of business today. If you have been on such a course then you need to eliminate the following five myths from your sales strategy.
Myth 1. Canvassing new customers must take priority over caring for our existing customers.
Some companies spend huge budgets on giving priority to extending their client base to incorporate new clients. In most industries the cost associated with canvassing new clients is at least four times as much as that associated with retaining existing clients. Poor client care can, in fact, turn the cost screw the wrong way.
You should regulary review the budget allocated to retaining and developing your relationship with existing clients and compare the degree of effectiveness (costs/turnover) with the last campaign you launched to canvass new customers. You should also focus on re-activating those clients whose buying frequency has dropped off and/or whose order volumes are declining. This helps to prevent the establishment of non-active or sleeping customers. Remember a long-standing client is worth just as much to you as a new client - indeed they are more valuable! Your office and sales support people can be encouraged to assisst in re-activating sleeping clients by giving them some appropriate sales training so they develop the skills needed to do this.
Myth 2. Big clients are the best clients.
Large-scale customers often account for more than 50% of a businesses turnover. Relations with large-scale clients are usually stable, reliable and long-lasting, but are they also profitable? Loyalty discounts, credit concessions or special delivery conditions can mean that per unit sold, the cover contribution is actually lower than sales to smaller clients. Make sure you regularly compare the profitability of your large-scale clients with that of your smaller customers. Clients who make real losses are harmful to routine business.
Myth 3. Sales people know everything about their clients.
Sales people know all they need to for concluding routine business with their clients, because they have taken time to specifically find this out. However, once they have done this they seldom ask about the client’s background, current challenges or strategies employed. You should encourage your sales people to try and find out as much background information about their customers at every contact. In addition you should actively support any promising plans the client may have by creating a tailor-made offer from your product range.
Myth 4. The Sales Manager's dream is for 100% client satisfaction.
Total quality management (TQM) is the cause of this myth as the dream of 100% client satisfaction is a byproduct of TQM. Hard facts dictate that the cost of actually raising customer satisfaction from, sa, 85% to 100% is almost unaffordable. Rather than aim for blanket perfection, find out what your clients really want and how they want it. Then you can calculate just how much it will cost you to fulfill these wishes. In doing this you will find that some wishes are just too expensive. Others have a better satisfaction/expense ratio and these should be implemented by you - but remember to set a reasonable limit!
Myth 5. The best sales people are those who have a long-standing relationship with the customer.
Of course, sales people cultivate a personal relationship with their most important clients. After many years or even decades, however, the time can come when the depth of the personal relationship can block out financial reality for the sales person. Selling really means convincing, negotiating, and launching new products onto the market - all the things that are not practically possible within the confines of a close personal relationship. If sales people think they know their clients very well, they are not so interested in checking out that client’s strategies, plans and needs. They think that they already know these and are then amazed if one day some of their clients find that competitors are in a better position to fulfill theses needs. Regular refresher sales training can re-focus your experienced sales people on being objective about their long-term clients before it gets to this situation.
