Simple Sales Tracking Blog

Prospecting Plan – Do You Have One?

People don’t deliberately plan to fail but often fail to plan.

In sales one of the most crucial elements is a prospecting plan.

A challenge for many salespeople is they do not have one and as a result spend the vast majority of their selling time with their “friendlies” (clients they get on well with), who may be great people but not necessarily their “A” or “B” customers.    This often results in poor sales results and leads to a lack of growth.   These type of salespeople are often referred to as “Farmers”.

To develop a prospecting plan we need to start with clear sales targets and goals, as without these we cannot work out the activity target and our numbers.   Once we have a number we can work out our average sale which we divide into the total sale target to then come up with the number of sales we need to achieve the overall target.

From this we can divide by our closing ratio to see how many sales interviews we need to achieve our overall target.

We can now work out how many referrals we need to generate by again dividing this number by 80%.  Generally with referred leads 80% will give you an appointment.

This is what it looks like –

Sales Target  $500,000
÷           10,000        Average sales over 12 months
50         Sales required this year
÷                50%       Closing Ratio
______
100        Sales interviews this year
÷               80%       Appointment closing ratio
______
125        Referrals required this year to achieve sales target
÷                 46        Working weeks in year
_______
2.7        Referrals per week
=======

We now have the numbers, the important one for us is the number of referrals needed each week e.g. 2.7 as our example shows.  The next step is to plan where these referrals will come from.

Referrals come from many sources including existing clients, peer groups, referral groups, social networks, centres of influence, family and friends etc.  The challenge with many of these sources is at best they are spasmodical and at worst we get none at all.   We as salespeople are leaving referrals and our sales success to chance.

A survey conducted by CSO Insights in 2007 which analyzed lead generation published the following results –

5.7%    customer service
17.5%   customer referrals
24.4%   marketing programmes
11.6%  other
40.8%   self generated by salesperson

What these results clearly show is the greatest opportunity for frontline salespeople and business owners who have to sell their services to grow their business is through self generated leads.

To achieve this we need to systemize our referral systems, firstly from our existing clients and then through centres of influence, our two biggest/best sources of referred leads.

A question I often ask experienced salespeople is “how often do you ask your clients for referrals?” and the answer I get is   “hardly ever”.

The reason is they used to ask but after many “can’t think of anyone right now but will think about it” they gave up asking.   I often say the quality of your questions will determine the quality of the answers so if you want more referrals from existing clients stop asking “who do you know who might be interested in what we do?” and ask for a specific referral to someone you know they work with or associate with.

In my next article I will look at the key activities of a prospecting plan.

Quote of the Week:

                                             If you don’t ask the answer is always “No”

 

Brett Burgess is a Sales Trainer and Programme Developer for Sales Impact Group.

 

Filed under: Sales Techniques and Strategy, , ,

What Is Your Prospecting Plan?

We talked about “Farmers” and “Hunters” last time and how many salespeople fall into the comfortable role of farming their existing clients rather than bringing on new business.

This occurs largely due to a lack of a clear step by step plan on how to go about prospecting. Many salespeople make the excuse they are so busy servicing existing clients they don’t have time to prospect for new ones.

A recent study of over 500 companies in the UK would tend to support this argument. They weighed the influence of 73 different factors in successful selling.

What would you expect the number one cause of low achievement in sales to be?

  • Low motivation?
  • Personality Problems?
  • Inferior products or service?
  • Poor training?
  • Overpricing?

Wrong.

This survey pinpointed the number one cause of low achievement in sales as poor time utilization due to lack of planning.

This considered it comes back to us as the salespeople to plan our time to maximize our face to face time with prospects and clients.

A client I worked with recently in professional services was able to delegate 11 hours of low value work he had got into the habit of doing. This effectively gave him another 7 appointment slots in his week which could be used for –

  1. First appointments with new prospects
  2. Follow up appointments
  3. Existing client appointments
  4. Centre of influence meetings

All key components of a prospecting plan.

Another constraint that can impact on prospecting is the sales manager or business owner overloading the salesperson with other duties.

What we need to think about is in the wide range of activities we do in our business – manufacturing, accounting, HR, risk management, sales, research and development, quality control etc. Out of all of these only one – sales activities – brings in the money.

There is an old saying – “Without the sale no-one gets paid”

Another one for us to think about is – “Unless you are talking to a prospect or a customer you are unemployed”

So back to our prospecting plan – our first step is to have a clear picture of the type of prospects you wish to target, for without this you will waste precious time hunting the wrong game.

In our training we develop a prospect profile which describes in generic terms what a good prospect for our business would look like. This helps us to clarify which type of clients we wish to target and helps our centres of influence to better understand who they should be referring to us.

We will look at the next step in my next article.

Quote of the Day: Clean out your prospect funnel. Put your current prospects through a sieve. The biggest mistake salespeople make is they call on the same useless prospects over and over. If you have not been able to get anywhere with a specific group of prospects, move on and find new prospects. Being persistent is good. However, if you are spending too much time on fruitless leads you will just burn out. After a shepherd’s herd has eaten all the grass in a specific pasture he knows its time to move on to a new pasture. If he does not move on his sheep will starve. Move on if you are not getting anywhere with old prospects and come back at a later date. Larry Duca

Brett Burgess is a Sales Trainer and Programme Developer for Sales Impact Group.

Filed under: Sales Techniques and Strategy, ,

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Simple Sales Tracking is web-based sales CRM software for the tracking, analysis and forecasting of individual and team sales pipeline and contacts.

Built with simplicity at its core, focus is kept on key sales tasks, while eliminating unnecessary ones, helping to ensure buy-in of the entire sales team.
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