So sales is easy?

Sure it is - for anyone who is not in sales.

Sales is easy when you know how and absolute hell when you don't. It is like being a master craftsman - you will have spent years mastering your trade and learning the intricate skills required to be one of the best and you will have confidence in what you do - the problem is that salespeople rarely command respect.

I am constantly baffled why salespeople do not get the respect and admiration they deserve. I have been in sales for over twenty years and I still meet people in the commercial world who regard sales as being a job for the  loudmouth ego's. Persuading a business or individual to buy your product or service is hard at best and has possibly the lowest success rate of any trade. For every sale you make you may have been told "No" to the one hundred phone calls or emails you have made perviously.

If you are an accountant, lawyer, banker, doctor or professor you will have gained some respect for the effort and time you will have invested to be a qualified professional or expert. You cannot be a sales expert.

Without doctors people die. Without lawyers they feel wronged, without bankers they are putting their money at risk (maybe!) but without salespeople what is there? Who sells the drugs to save you? Who persuades you to buy things that results in businesses banking their takings? Who grows your business or the businesses of others that create the growth you need to be employed? Without salespeople most businesses will be nothing at all and yet the lifeblood of many businesses are given such little respect. 

Salespeople are needed and should be respected as professionals. You cannot get a degree of any value in sales, you cannot be qualified but an awful lot of salespeople have made their bosses an awful lot of money and yet these bosses will be much more likely to boast the merits of their business concepts and not the salespeople who delivered the paying customers.

I have experienced this first hand with an old business partner. We built a business over many years that we successfully traded and sold. We were very well served by some excellent salespeople who have now moved on to pastures new but ultimately they created the value that allowed us to sell. My ex-Partner now, despite having never actually sold or even met a customer, regards himself as being the key to the success of the business and will happily tell all he can about his business successes without a mention of the people that delivered the sales.

There is however a balance. I have been in sales for over twenty years and have seen all of the ups and downs. Salespeople are generally fairly arrogant, selfish, egotistical, greedy and are bad at accepting any criticism. They can be very difficult, stubborn and often lack understanding of the roles of others. I therefore do not put salespeople on a pedestal and am fully aware of their negative character traits but we all need salespeople in business - whether we are buying or selling, it's them who make the business world tick. Sure there are rogue salespeople who lie and twist the truth to get a sale, but there are rogue builders, accountants, mechanics, landlords - there are rogues in all walks of life.

The art of sales cannot be simply summarised as having the ability to talk and be persuasive. The sheer thought and strategic planning that can go into winning an order or contract can be immense. A salesperson will analyse every part of the contact with the client and will go over and over the detail trying to find, understand and solve any objections or concerns the client may have. They will need to understand where their product or service may be weaker than their competitors and what they need to do to counter that. They will need to understand the clients opinion of them and the business they represent. They will need to deal with the budget constraints of the client and may need to become very creative in finding ways that make their proposal affordable. This is a process that is often started in the car after an appointment and the salesperson will be going through every small comment and reaction from the client and trying to highlight anything significant. It is a hugely taxing process that takes years to master and will occupy much of the salespersons thoughts during the day.

I have taken on junior salespeople and made them brilliant, I have employed great salespeople and made them even better and there is one consistent fact I am constantly reminded of - good salespeople need to work very, very hard. They are grafters and they are hungry, yes they mostly want lots of money, a flash car and good luck to them. Boost their ego's, tell them they are amazing and watch them puff out their chests and go sell for you. They want to be the best, they want their peers to be jealous of them and they want to earn fortunes - you want the sales and they want the money so give them every incentive they could dream of and watch your business grow.

I would love to know your thoughts or experiences on this topic so please let me know in the comments below.

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How do your quotes or proposals look?

The proposal or quotation. For some businesses this is the most important document in their portfolio and they can spend hours or even days labouring over providing a personalised proposal for a client. On the other hand there are just as many businesses who will sing the merits of a single-sided A4 sheet of paper detailing the elements and a price. So what is the right way for you?

I think any business does need a mixture of proposals at its disposal. This is simply because no two clients are ever the same. Some will want chapter and verse on what you can provide and others will just want a price. The problem is that you won't be successful if you present a simple proposal to someone expecting detail and you certainly won't inspire a person who just wants a price with a fifty page bound presentation.

Reading the client is key and the manner in which you deliver the proposal can make a big difference. If I am unsure as to what my client expects and I have not felt comfortable enough to pose a question then I will deliver a well separated proposal that contains plenty of information whilst ensuring that the client can easily locate the pricing page(s) if that is what they want to see.

Whatever the size of the document I consider it essential to start with detailing the requirements of the client and the briefs of any meetings that preceded the presentation.  Your interpretation of what the client has requested is vital to ensure that you have clearly identified their needs and to avoid any misunderstanding about what is to be provided. I generally open most proposals with a positive comment about the client; "Bob Smith provided us with a well defined and excellently considered brief..." This often will entice the client to ensure your proposal is shown to the bosses!

A quotation that is based on a template is ok as long as there are elements that will be personalised. I think any quotation that does not have any personal input will be obvious and probably overlooked by the recipient. On the whole though I would suggest writing your proposals with large emphasis on personalisation to the client, it shows diligence, effort and an attention to detail.

Visual representations are often well received - a picture can be worth a thousand words so if you are able to illustrate any elements of your recommendation then do so. This will require a few design and graphic skills but all these are very simply applied if you or your salespeople have Apple's MacBook's rather than conventional PC's.

Your proposal is a very important part of the sales process and must be respected as such. As it is a printed document you are not in control of who reads it and hence you need to make sure that whoever is passed your proposal is able to understand and digest its contents. I invest a great deal of time into my proposals and always make sure I include something that nobody else will have added. Whether this be a visualisation or some data, additional benefits or a relevant case study - I will not allow a proposal to be submitted that I do not feel has an edge in some way.

Just for a final "plug" at the end I would add that SalesFriend will review, edit, create or rewrite your proposal content at any time :) You can email me directly any time at chris@salesfriend.co.uk

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Who decides your price?

This is a very pertinent question. I have assessed many businesses over the years who have a pricing policy decided ultimately by the salesperson.

Often there will be a cost or trade price with the salesperson receiving a percentage of the profit between the trade price and the sale price and this can prove highly successful. 

It can also be problematic as many salespeople are inherently selfish and will often adapt any proposal to suit their needs rather that of the customer or their employer.

So how do you manage pricing within your business? How do you ensure your customers are getting value whilst still allowing your business to make a profit and keep your salespeople well rewarded? In truth it is very hard as there are so many moving parts to keep well-tuned. What you may regard as a fair price for your product could be deemed to be expensive by a competitor who has a differing business model. Offering a very low price will affect your profit and probably the commission of the salesperson too.

It all ultimately comes down to the overall objectives of your business and what you are looking to achieve. I have operated a few schemes whereby the customer gets a good deal and the salesperson gets the lions share of any profit and I gain the benefits of the ongoing business. This has always worked well for me as my previous businesses were generally centred around long term sale value rather than a need for a large trading profit. These schemes allowed me to reward salespeople at a level that few others could match and our customers got a good deal - and my client base grew quickly.

Salespeople will always need some degree of flexibility of pricing as giving a discount or doing a deal is a fundamental part of the sales process. By not providing the salesperson with a discount tool in their kit is like asking an artist to paint without a brush.

There are a lot of businesses who apply a simple markup over the cost price - this is very common in retail and low-margin, high volume businesses. On the whole these do prove successful but can also be very predictable for competitors who know they will be competing against you for your business - a big problem for standard B2B sales in a localised environment.

If your business has a need to issue a price list to clients or on its website then it becomes essential that you have a robust and regularly researched pricing policy as comparisons become very easy and you will often have no human interaction to justify or explain your pricing.

It is important to remember that pricing is not everything. I have had clients historically who have proved very profitable for me and pay a high price for my products and services but they get what they need. It may be they needed me to be on call 24/7 during the rollout of a project or that they needed full time project management or for me to be able to drop everything during a key phase and produce some advice at 3am on a Sunday morning. My clients understand that they are paying a premium for me if they need me to be available for them regardless of the time of day and we all regard this as being completely fair.

For me as a business owner it is important that everyone feels they are getting a fair price. The customer must not feel they have been charges excessively, the salesperson must feel well rewarded and I must feel that I am doing something worthwhile. There is little benefit for anyone involved if either party in a transaction is resentful of the price paid.

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Do you really need a Sales Manager?

I have encountered this a few times. The head of sales has been promoted through the ranks and now manages the sales team and takes responsibility for all sales related issues within the business. They rarely sell.

Often they have been a top performer with a great track record and are therefore the natural choice to head the team when the time comes. Natural choice? For who? 

Taking your top performing salesperson away from sales duties and into a management role can defy all business logic and whilst they may be delighted with the pay rise, better car and the prestige there has been little done to be any benefit to your business. If you have a salesperson who performs consistently why on earth would you change anything that may affect that performance?

I have learned over the years that for most sales teams of ten or less people there is no need for a Manager or Director. Motivated salespeople need very little management. There is certainly a need if there is training required by then this is best organised in the field with the sales staff and certainly does not need a dedicated person with a title. As the owner of the business you are best placed to manage the needs of your sales staff and adjust things accordingly - a sales manager in a business of ten of less salespeople is an expensive and unnecessary luxury.

I have been in the position of Sales Manager with sales teams of between seven and  nineteen people. My life with the team of seven was hardly a challenge, I did not ask for the job, salary, bonus or the Range Rover that came with the title but all was laid on regardless. I had my seat at the monthly "Management Meeting" and I was able to hire and fire but other than to intervene in the odd issue between sales and operations there was little to my job and I found myself missing the buzz of the win.

I met with my MD and we collectively agreed that the position was part-time at best and really required little more than a few hours each month and as such I returned to a predominantly sales-based role where my skills were best utilised whilst I "managed" the sales team on a part-time basis and remained as part of the management team.

As a salesman I didn't want or need management. I was able to manage myself and worked to a simple principle that Monday to Friday was for selling and weekends off. I would happily work 20 hours a day in the week but would never work on the weekends and this discipline worked well. I knew that without time away from work I would perform badly so I allowed no compromise in this regard.

With a team of nearly twenty there was certainly more of a demand for me to wear my Manager hat but this was only really to support salespeople with prospects that I would have handled alone had I remained as a salesperson.

I am not suggesting that there is no need for any management with a sales team but I do question whether any sales team of less than twenty needs a full time manager. It is really the case that with experienced and performing salespeople there will be very little need for daily management. Actually, it is often the case that a manager can negatively affect performance as they can find it necessary to instil their own methods on people that have no problem performing. 

In my opinion, it is essential in any business that management within a sales team (if they are necessary) must be actively selling and maintain their own customer relationships. A Sales Manager who does not produce sales will quickly lose the respect of their team. Whereas a performing "manager" who is also part of the team will have plenty of respect.

If you have a Sales Manager in your business ask yourself what value is created by their position? In my experience the vast majority of the duties in this role, such as reporting and monitoring, can be performed by an Admin Assistant with the support of the part-time Sales Manager to handle the few management responsibilities that are required.

By their very nature Sales Managers are well equipped to justify their positions and benefits but the reality will often remain that they are best for you when they are in front of customers.

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How much should you pay a salesperson?

The million dollar question!!

As an experienced salesman I have had salaries ranging from £6,000 per year to well over £200,000 plus commissions and bonuses - but I do regard myself as one of the best! :D

I was always very careful to ensure the package I was offered was balanced - a salary that is too high just made me complacent and ineffective and a salary that was too low just bred resentment.

The one criteria I always set myself was that by employer had to make money from me - if they were making money and I was then we were both happy.

A "get it while you can" attitude simply equals a short term position. No employer will tolerate you getting paid a huge salary without exceeding all expectations.

When I have been the person footing the bill for salespeople I have always worked to a 1:4 ratio. The salespersons salary should be 1/4 of their On Target Earnings and their OTE should be realistic. I always paid high commissions and big bonuses as I always wanted my salespeople to be chasing the next target. Therefore I was happy to pay a salary of £25k if the OTE was £100k and this would be the minimum acceptable level of performance. Anyone that sat in front of me and wanted a higher basic salary and lower commission would experience a very brief interview.

By sticking to these principles I was fortunate to work with some very successful sales teams who simply did not tolerate the interference of managers who wanted to overhaul the methods of consistent performer. They wanted to be left alone to perform and expected to be well rewarded for doing so whilst always knowing was help available when needed.

I have never had a problem with a salesperson who requests a minimum take home pay for a limited period in order to get established - in fact this filled me with confidence. A salesperson who simply needs to earn big money in order to fund his mortgage and lifestyle will be very driven and will nearly always excel. In every instance where a candidate has requested a minimum level of take home pay I have always requested previous wage slips. If they are requesting a guarantee of £3000 for three months then I need to be shown that they have consistently earned in excess of this figure and that the request is genuine. This of course provides me with additional proof that they have previously performed at a high level.

A good salesperson with a proven track record may well be worth breaking your budgets to win but remember that whilst salespeople are good at selling themselves but there are a myriad of issues that may arise when and if the salesperson starts working for you. I am guilty of following my gut instinct a few times too many and have paid too much to people who did not perform as promised and I have subsequently had to have some difficult conversations. I now work on a very clear principle, I will pay great money when the salesperson has proved themselves and I have no problem with committing to that within the offer of employment I send to them. If they meet the required targets for an agreed period of time they will receive whatever has been promised. I will often award the increases or bonus in stages over twelve months as I have often seen an initial flourish followed by a barren spell in the first year of employment.

The reality is that I cannot tell you what to pay your salespeople but I can tell you to make sure that they earn just enough to live and need to sell to live comfortably and need to sell lots to live well. Do not over-reward underperformance. Remember you only employ a salesperson to make money and/or to increase your value and the majority of salespeople are not as good as they claim!

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Whose clients are your clients?

So your best salesperson wins a great new customer.

Things are good and this is one of the customers you have been targeting for a while. Sales will increase and so will your profits...nothing but good news, right?

Hopefully.

Now take a step back, does the salesperson refer to this new client as "his" or "hers"? If you hear this phase then you have a problem.

This client is YOURS - you paid the salary of the salesperson to win this client, you will have paid the commission and probably the mileage of the car to get to the appointments. You will have paid the mobile telephone bill for all the calls and all the emails will have been sent from your domain name. You cannot allow this client to be owned or controlled by the salesperson.

Regardless of how much your salesperson resists you need to make sure someone else meets this client, your client. Take them to lunch or just meet with them, if nothing else call them and introduce yourself.

These words are not intended to ensure that you undermine your sales staff or to imply you should not have complete trust, they are intended to protect the investment you have made in securing your clients. I have lost count of the businesses I have met that have experienced desperate times after a key salesperson left the business only to embark on a complete assault of all clients known to them and have "stolen" the clients for their new employer. These clients are often told many untruths as encouragement to change.

I have found one consistent fact in most of these cases - despite what could be many years of loyal service, the salesperson will generally lose all loyalty to you once they are working for a competitor and have new targets to meet. In the cold light of day - the "existing" clients of the salesperson will be the easiest catch out there and many find it hard to resist.

When I raise this issue with clients I am often told "don't worry, that is all covered in our employment contract. Our salespeople cannot approach our clients for a year after they leave". "That's great" I reply "have you considered if and how you could enforce that contract before the damage is too severe?" Silence is the most common response to this question.

Take a minute to think this through. You have 500 clients of which 40 clients place orders every month. Your salesman, let's called him Kevin, he has left for pastures new and you can still recall the handshake he gave and the assurance that he won't cause you any problems in his new job. A couple of weeks after Kevin left you have noticed sales are a little down, nothing severe but enough to register with you. End of the month arrives and sales are more noticeably down, by 30%. You look through your sales ledger and see there are ten or so regulars that have been quiet. You call a couple of the owners you know, they are not available but you are assured of a call back. A week goes by, no calls returned and still sales are falling. You call another few regular clients. Finally one tells you the news that will send a small chill down your spine "Oh Kevin came to see us and told us he could save us 20% on our bills so we have signed up with him".

Kevin has been busy, in fact by the time you are first advised he has broken his word to you he has already signed up 20 of your "regular" clients and in effect has halved your businesses regular income.

Now Kevin won't answer his phone or reply to your messages, emails or letters. You contact your Solicitor to enforce the contract of employment. A very strong letter is sent out and you feel that all will be OK. Kevin may take notice, he may not but you will not win those clients back as a client will not be told who they must buy from. If you attempt to reduce your prices to match or undercut those of Kevin you will be asked why you didn't offer these prices before. Either way you have lost and there is nothing you can do.

You may send a few more letters to Kevin threatening court action but you won't actually go to court as your Solicitor will tell you that you are unlikely to win. Perhaps you do go to court and you do win, what have you won? Can you realistically collect any compensation? Will you get your clients back? It is all so stacked against you, the damage is done and you will need a minor miracle to come out of things unscathed.

So what can you do?

Well there is little you can do to guarantee this will never happen to you but there are many steps to reduce the possibility. Certainly a tight contract will deter some and a good amount will keep their word to you. For sales staff I always consider paying an additional 2.5% commission as a loyalty payment to be paid no less than six months after they have left your employment. If "Kevin" earns around £3000 per month then you will add £75 to the loyalty fund each month. After five years of service this fund could be £4,500 and that is hard for anyone to walk away from and may well focus his mind on keeping his word. Six months after he left you will have had chance to build new relationships with your clients and Kevin will find it much more difficult to win that client's business. I have found this method effective in retaining loyalty and also taking them out for lunch on their final day to set things on the correct course seems to end things well. Finally, as a last action on leaving day I draft a letter to all customers for the leaving salesperson to personally sign and send to thank them for their business and to send them best wishes for the future. This letter always concludes with: "due to my personal desire to keep my word to, agreement with and my respect for ABC Limited I will be unable to keep in contact with you professionally and hope that you can understand these principles...." I have never had a single person, having shaken my hand that then refuses to sign these letters.

Whilst there are many options to protect your business - the easiest and most effective of all is to recognise you need to manage your clients in a way that means they have a relationship with you and your business too - not just your salesperson. This will not happen overnight and certainly should not start when a salesperson has just resigned or left - your clients will see right through that. Regular contact with all clients is essential, whether it is a monthly customer service call or an event/open day when your clients can meet you in a social environment your clients will stay much more loyal if they know many members of staff at your business. 

Encourage your non-sales staff to build good relationships with clients when they have the opportunity to do so. If a client makes a payment ask staff to call them to confirm receipt and say thank you - simple little touches that will often lead to a brief chat or moment of humour can really help build relationships and make a big difference when changes do occur.

Losing a client is painful at any time, it is agony when you lose a client to someone to whom you paid a handsome wage and trusted.

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Can your customers afford you?

Do you offer a high value product or service that is only really available to businesses with deep pockets? Do you offer flexible payment solutions?

If the answer is No then you need to read on.

Making your product affordable or linked to the cost benefits it creates is simply a non-brainer. A product that saves £300 whilst costing only £200 a month is a very attractive proposition.

By allowing your customers to spread the cost of their investment in your product you are making your product easier to sell without affecting your cash-flow negatively.

How can this be?

By allowing your customers to rent or buy your product over a fixed-term contract can result in your business getting paid for the product in full upon delivery and your customers to pay monthly or quarterly.

With some schemes, at the end of the term of the contract ownership of the equipment can be passed to the customer, the lender or the seller and this can mean that the product can even be returned to you at the end of the agreement.

I have found that many businesses that use this service are able to satisfy the needs of customers with all budgets: Companies that want new equipment can be assured that they will have their equipment replaced every three years whereas businesses with less available capital are able to rent the equipment that is no longer required by others for a low rental. The company that made the original sale get to provide value and make money from both clients and therefore everyone is happy.

Funding services are provided by a number of operators, for more information feel free to contact us.

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