Tweet

Start of Year Tune Up!

Guest post by: Tibor Shanto

Article Overview: New year, new beginnings. Give yourself an edge and get ahead of the fray by doing a few simple things at the start that will pay of the entire year and beyond.

Start of Year Tune Up!

Ah the New Year, ripe with promise and hope, and the opportunity to sweep many things (incomplete tasks, last year's resolutions...) under the rug, and start it all again. The time of year where everywhere you turn there are articles and news items on what to make this year better, faster, brighter and more prosperous than last. As sales people, by the time you read this article, you will need to act fast to fully impact 2008, because what ever the plan, it should have been done a while back and actioned by now. But let's not start things on a downer; there are some things you can do now to make a difference.

One of the most important is to recalibrate key metrics and time horizons. This needs to be done for a number of aspects or areas of sales. One is the length of your average sales cycle. Over the last 12 months a number of things have impacted the economy, as a result markets and more importantly, our clients' and prospects' perception of threats and opportunities in the market. This could impact their view of what is "mission critical" (must have), discretionary (nice to have), and things between. While it would be great to have our offering move to a critical need category, the reality is it could also swing the other way. Either of the above will impact the length of our sales cycle, and in turn we will have to adjust expectations, activities, and make allowances in how we execute the sale. In fact it may turn out based on review that his will cause you to revaluate related priorities and move prospects up and or down your target list.

This assumes that you know what the length of sales cycle was at the start of 2007, and have tracked it through the year; if not, you can go back and calculate things. It may seem laborious and time consuming, but once completed it will pay dividends in many ways. Look at a sufficient sample of sales, depending on your product, and such this may require that you back more than a year to get enough data points. Mark the first meeting (or meaningful call if you sell exclusively over the phone), then mark the actual close (make sure you are consistent, you can use either signature or PO date, or delivery date, as long as you are not mixing along the way). Once you have a sufficient sample, remove any anomalies, and then look at what the average length of each sale was. This same process should be repeated for other key measurables (see side bar), as well as for sales to new clients vs. old, renewals up-sells, etc.

(While you are working with data, you should also look at other factors involved in the sales process. One simple fact to remember is that the length of your cycle can and likely vary for sales to new logos from sales to existing clients, as well as any variation that your business has to deal with. Needless to add, this process may have to be repeated across various products with different cycles. If in fact you do sell different products, with different cost levels, see what the average revenue per deal is, average margin, and other measurables)

If your cycle has stretched you will need to make adjustments to ensure that you are not squeezed by the longer cycle. A longer cycle is not necessarily a bad thing, you just need to be aware and adjust your activities to align them with your goals.

Along with the above, you need to look at your conversion ratios along critical points of the cycle. If you are converting less initial meeting to discussions, less proposals to closes, etc. you will need to make allowances for that. On the other hand if you have improved your ratios, you have the luxury of choice in how you use your new found bandwidth.

The key with both of these is that they are either caused by external factors or your own actions. Being proactive will help you with both, but it's best to focus on what you can control.

One of the most effective means of being proactive is to allocate the appropriate time to specific activities. Once you complete the areas discussed above, or similar examination of other key areas for you. You need to decide how much time you can logically devote to each in an ideal world. We all know "ideal" may not always be attainable, but you need to set your targets for time allocation in an objective way. For example:

Prospecting 30%

Selling or converting Prospects to customers 25%

Account Management 20%

Learning, self improvement, product and market knowledge 10%

Administration, CRM updating 10%

Networking, referral development, etc. 5%

Your tasks may differ, and the percentages will vary depending if you put proposal writing under sell or admin, etc.

Once established, you can have reality checks throughout the year to make sure you are devoting the right and enough amount of time to the right task. Simply stated proactively managing, not reacting and getting distracted from you plan.

These are but a few things, there are many, but the process stays the same. Set parameter based on your new goals and your market realities, then proactively drive your activities to ensure success. Measure quarterly, if on track keep going, if not recalibrate.

Related reading: Working Backwards From Your Goal To Get Ahead

How to Shorten Your Sales Cycle?

Related Articles
  Leading Is Like Playing the Guitar
  Salesmanship and Empathy
  Keep Your Marketing at the Leading Edge in 2005
  8 Tips to Tune Up Your Business
  Career Tune-up: Maintaining your Professional Path
  Closing Too Early- The Risk of Overdoing it
  How to Ensure you Reach Your Finanical Goals
  The Christmas Close - Insurance Sales Training
  3 Steps to Customer Intuition
  Is Your Sales Force a Ferrari or a Chevy?
  The Key in Life Coaching is Spiritual Empowerment
  The Spirit Of Giving
  Things To Consider When Purchasing Insurance For Your Small Business
  YOU MUST KEEP LEARNING!
  It IS a Popularity Contest
  Sales Big Picture - Top Salespeople Combine the Art and the Skill
  Performance Expectations - 5 Tips and 5 Questions
  10 Commandments to Selling
  Easy Energy Fixes for Big Savings
  How to Easily Break Free From Distractions with Some Simple Time Management Solutions

Article Tags: execution, prospecting, renbor, sales, sales cycle



Related Forum Posts
How to valuate a business - Hi Garth - here is how we did it at Northern Crown Capital when I was helping them raise venture capital for Toronto-based entrepreneurs. Assume the start date is 2003 so 2008 projections are 5 years out: How Northern Crown Capital Valuates a Business 2008 Financial Projections Earnings Before Tax $5,865,000 Tax Rate 42% Taxes $2,463,300 Net Earnings $3,401,700 Amount Seeking to Raise Today $3,500,000 Discounted Value of Future Opportunity, 5 Years Out 2008 P/E Ratio 15 Value of Company in 2008 $51,025,500 Discount Rate Applied 30% Year 2008 $51,025,500 Year 2007 $35,717,850 Year 2006 $25,002,495 Year 2005 $17,501,747 Year 2004 $12,251,223 Value of Company at Investment in 2003 $12,251,223 Less: Investment Amount $3,500,000 Present Value $8,751,223 Discount for Risk & Private Company 40% Less: Discount for Risk & Private Company $3,500,489 Private Company Value $5,250,734 Present Value (What the Owner Keeps) $5,250,734 60.00% Financing (What the Investor Gets) $3,500,000 40.00% Total $8,750,734 100.00% I hope this helps!
Re: HAPPY NEW YEAR! - Happy New Year!
Betting on the law of averages - Dale Carnegie says "As the years went by, I gradually discovered that ninety-nine per cent of the things I worried about never happened... The most famous insurance company on earth-Lloyd's of London-has made countless millions of dollars out of the tendency of everybody to worry about things that rarely happen. Lloyd's of London bets people that the disasters they are worrying about will never occur. However, they don't call it betting. They call it insurance. But it is really betting based on the law of averages...don't happen nearly so often as people imagine" ("How to Stop Worrying and Start Living" 67 & 68). In the past, I think I spent an additional $130 for "3 Year Return to Depot Service and Technical Support" when I bought my Dell laptop and $30 for 2 years of replacement protection for my glass desk. While I've had to call Dell for technical support for my laptop on a few occasions, I've yet to replace any glass panel on my desk.
New Year - New Resolutions? - Anybody got any goals they'd like to share for the New Year?
Re: Hi Everybody - Thanks a million GT Have a Happy New Year


Share this article with your friends. Fund someone's dream.

Leave a comment below or share on the left and you'll help support entrepreneurs in Africa through our partnership with Kiva. Over $50,000 raised and counting - Please keep sharing! Learn more.

Newsletter

Get advice & tips from famous business
owners, new articles by entrepreneur
experts, my latest website updates, &
special sneak peaks at what's to come!

Name:
Email:

Popular Articles

SEO and the Entrepreneur

How to Find a Niche and Make Money Online

The State of the Sustainable Furniture Industry

Suggestions

Email us your ideas on how to make our
website more valuable! Thank you Sharon
from Toronto Salsa Lessons / Classes for
your suggestions to make the newsletter
look like the website and profile younger
entrepreneurs like Jennifer Lopez.