Setting Sale

Is your business anchored down by a stale sales plan? Learn how to navigate the 5 biggest sales challenges facing entrepreneurs today, and get back on course.

For Diane Hessan, selling is a lot different than it was just a few years ago. Sales cycles are longer as prospects convene 15-person committees to debate even the smallest sales decisions. Customers demand to see a definitive ROI before they'll buy, and they ask for more price breaks when they do.

"It's just a much more challenging sales environment," says Hessan, CEO of Communispace, a 40-employee software company in Watertown, Massachusetts, that helps blue-chip companies get customer feedback and insight over the Web.

Hessan and the company's four in-house salespeople are putting more emphasis on solid relationships with existing customers, and the company's implementation people are much more involved in the sales process. A referral program pulls promising leads from customers, and each resulting sales call is customized to the prospect much more than in the past. "We're trying to reduce our ice-cold [sales] calls," Hessan says, "and we're spending a lot of time collecting ROI stories and using them in our sales process."

Hessan, 49, isn't the only entrepreneur navigating a sales climate that's gotten a little better but still leaves much to be desired. When sales and marketing research firm CSO Insights surveyed more than 1,300 sales professionals for its report on sales effectiveness in the fourth quarter of 2003, only 49 percent of sales reps met or exceeded their quotas for the past year-the lowest percentage since 1994. Even more startling, 70 percent of the study's participants were small businesses with fewer than 50 employees. "For the under 50 [employee] group, it's even worse. For them, quota attainment was 46.6 percent," says , a partner at CSO Insights and co-author of the firm's sales-effectiveness study, released in February 2004. "It's fair to say that virtually everything is going in the wrong direction for salespeople."

It takes more forethought and way more strategizing to meet today's biggest sales challenges. "How you sell is becoming as important, maybe more important, than what you sell," Trailer says. Here's how successful entrepreneurs are overcoming their sales challenges.

Sales Challenge No. 1:

Increasing Sales Effectiveness
Making effective sales calls is one area where salespeople are falling short. A sales-effectiveness study of nearly 2,300 sales leaders conducted late last year by Reno, Nevada, sales training and consulting firm Miller Heiman found 67 percent of sales professionals believe their sales teams aren't making enough calls to add good leads to the sales funnel. In addition, 6 out of 10 say their sales departments aren't qualifying leads as well as they should.

For Mike Robson, building greater structure around the sales process has been key to increasing effectiveness. Robson, 39, is founder and CEO of ATA Services, a 48-employee company in Salt Lake City that maintains, refurbishes and brands existing ATM machines at banks and credit unions around the country. He's tightened the sales team's reporting procedures, monitoring the progress of the company's four-person sales team through daily call reports. Those call reports keep Robson posted on sales proposals and the salesperson's strategy going into a selling situation. More structure is generating more sales: ATA Services' sales in two of the four sales territories topped $1 million for the first time last year, and the company projects sales of $6.5 million in 2004. "We've had to become better at selling. We used to go by our gut, but we've moved to a more structured system," says Robson. "That's helped us."

Successful sales teams are establishing multiple contacts within companies that put them on the CEO's radar from a variety of different directions-marketing, IT and accounting, to name a few. They're also changing the way they approach prospects. Today, research combined with highly qualified calls to set up informational meetings with prospects is hot; overscripted telemarketing calls are not. Direct marketing is out; creating "safe venues"-webinars, breakfast meetings, research-report release events-to meet prospects and build credibility is in. "The space is so crowded that the way to get me to understand you is to give me some value," says Sam Reese, CEO and president of Miller Heiman. "The sales call comes afterward."

Steve Johnson is founder and president of G2 Safety, an Anaheim, California, distributor of gear designed to protect against workplace hazards. A few years ago, Johnson, 35, relied solely on inside sales and direct marketing to drive traffic to the company's Web site. But now, G2 Safety is putting more boots on the ground, having recently hired four territorial sales reps, with six more to be hired by year-end. And the company is also joining trade organizations to identify quality leads. G2 Safety's sales hit $1.5 million last year, and Johnson forecasts sales of more than $3 million in 2004. "We originally thought we could do direct marketing only," Johnson says. "[Now] I think you need to do everything."

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Chris Penttila is a Washington, DC-based freelance journalist who covers workplace issues on her blog, Workplacediva.blogspot.com.

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This article was originally published in the August 2004 print edition of Entrepreneur with the headline: Setting Sale.

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