Selling is both an art and a science. Knowing the numbers you plan to achieve and how they break down is critical to the science side of selling. This is where you develop your own personal measurements to help you know if you’re on track to your chosen achievements. Sales newbies may need a little extra help in setting goals for their selling lives.
Your sales manager can probably assist you, but be aware that any goals she helps you set may look more like company quotas. You see, every manager has a certain sales revenue amount she needs to meet for the overall company goals. Most managers spread that quota out among the various members of the sales team. Usually this is based on the manager’s belief in the abilities of each salesperson to produce. Unless you have an incredibly savvy manager, her quotas are not likely to consider what you want or believe you can achieve.
So take a look at the various activities required to generate income before setting your sales goals or agreeing to any quota your manager may try to put on you:
Determine what you believe you can have as an annual income goal.
Divide the amount from Step 1 by 12 to find your monthly income goal.
Divide the amount from Step 2 by 4 (the number of weeks in a month) to find your weekly goal.
Divide the amount from Step 3 by the number of days you work each week at making sales.
Now you have the numbers clearly before you of how much income you need to generate each day in order to reach your annual goal.
Take the average amount you earn from each sale and divide it into the money amounts for annual, monthly, weekly, and daily goals from Steps 1 through 4. This tells you how many sales you need to make each day, week, and month to achieve your annual income goal.
Consider how many presentations you need to make to get the number of sales you came up with in Step 5 and figure your presentation‐to‐sales ratio.
For example, if you typically close one sale for every three presentations, your sales conversion ratio is 1:3. So, you multiply the numbers in Step 5 by 3 to get the number of presentations you need to make.
Take your sales conversion ratio from Step 6 and figure out how many contacts you need to make to get the necessary number of presentations to make the sales and earn the income.
Decide whether these numbers are realistic.
The following table is a chart you can use to fill in the numbers from the preceding steps. Use pencil on it or make several copies of it as you work through your sales goals. When you start improving your ratios, it’s fun to fill in new numbers and re‐do the math. You may see that you’ll beat your income goal. Or, you may see that you can achieve the goal while working less.
|Number of sales
|Number of presentations
|Number of contacts
Grab a calculator and play with the numbers until you set sales goals that feel just right. They should be a bit of a stretch for you above and beyond where you are now, but they must be believable!
If any of the numbers you compute along the way in this exercise cause you to doubt your belief that you can achieve the goal, stop. Think about solutions you could implement to make the goal a reality. Do you need to sharpen your skills to improve your ratio? Are you setting your expectations unrealistically high as to the number of people you need to contact every day based on your current level of productivity? Are you willing to make the changes necessary to achieve these goals?