How to Increase Sales Is Process Driven and Begins with Existing Customers Not New Ones
So you want to know how to increase sales? Maybe you are looking in all the wrong places as that old song goes. Have you considered revisiting your existing customers and begin a process to help them grow instead of focusing on your sales growth?
Can you answer these questions quickly and honestly?
Do you know the top 20% of your customers who deliver the 80% of your sales?
Do you know the bottom 20% of your customers?
Do you know the top customers who make referrals that actually turn into clients?
Do you know what customers generate the most profit?
Do you know how much your existing clients cost you to acquire?
Do you know if your existing customers are high maintenance, high profit or high maintenance low profit?
Do you know your customer’s customers?
When you can begin to answer these questions, you can construct a sales process to work your existing clients. This process allows your to not only understand how to increase sales, but how to increase profitability.
For example, what would happen if you ranked your customers not only by sales, but by profitability? Would you be surprised by the results?
According to sales research, your top 20% most profitable customers generate more than 150% of your annual profits. When you lose one of these (this is why customer loyalty is more important than customer satisfaction), you need to find 10 to 25 new customers who generate average profitability. Now does that make sense wasting your sales skills and resources on mining for new customers when you already have a known vein of gold?
Additionally, that bottom 20% drains the overall profitability of the company. If you can help turn them around to at least a break even point, you would have doubled your company’s overall profitability.
By creating a sales process where your best customers are continually:
Touched through additional meetings
Asked for their thoughts on growth and innovation
Listened to for their concerns about customer service and overall organizational management
You can strengthen those relationships while simultaneously increasing sales and profitability. And you are actually helping your clients grow their businesses.
Then by working through the least profitability customers, again through a process, you can help them build their businesses and even fire a few customers if necessary. Maybe those bad clients are slow pay. Have you spoken to them as to why there exists this challenge? Possibly, you can establish new higher prices based upon their payment and offer cash discounts if bills are paid early. Who knows, you are only limited by your own thoughts.
Yes, you do need new prospects because of attrition and time frame of your products and services. However, if you want to know how to increase sales, begin first with your best customers for that is your gold, your known treasure chest. The hidden goal is those 20% bottom customers.