All Work & No Play
Developing Process
At the root of what entrepreneurs and sales pundits are talking
about is the need to approach sales as a process. Rather than
calling prospects and expecting to close a deal upon first contact,
salespeople are expected to systematically learn a market, develop
leads, prepare solutions and present them effectively. "A lot of salespeople tried to hit holes-in-one," says
Stephan Schiffman, CEO of sales consulting firm DEI Management in
New York City. "There was a time when you could do that. But
now you have to go back to the process and be good at it,"
adds Schiffman, the author of many sales books, including one he
considers particularly appropriate to today's selling
environment, Make It Happen Before Lunch: 50 Cut-to-the-Chase
Strategies for Getting the Business Results You Want
(McGraw-Hill). Salespeople can't expect golf outings and other forms of
entertainment to yield rapid results—or that time-pressed
clients will even accept such offerings. "Entertainment is on
the wane," says Schiffman. "Unless there's already a
relationship, taking someone to lunch doesn't serve a
purpose." Content Continues Below
Developing and executing a sales process can takes a while.
Eighteen months ago, an opportunity that did not pan out after four
to six weeks would have been labeled a low priority. "A sales
cycle of three to four months is now mainstream," Schiffman
says. It may take twice as many contacts to close a sale today, says
McClennan. And surprisingly, both entrepreneurs and experts agree
sellers can't always shortcut the process by just dropping the
price. "The old method of selling by price is falling by the
wayside," explains Dennis Kyle, a sales consultant with
Positive Results in Avon Lake, Ohio. "Organizations are
willing to pay more if the product's value is evident. They
won't pay a dollar for anything if they don't see the
value." | Performance Anxiety | The good news about paying salespeople today is that you can peg
a higher percentage of compensation to performance. The bad news
is, old measures of performance may not be good enough. Entrepreneurs today are having less trouble keeping good people
and hiring new ones at lower base salaries than in years past. But
they are also finding less justification for paying straight
commissions for new orders. Instead, they're basing
compensation on more exotic, harder-to-figure measures such as
profit margin per order and customer satisfaction. The revised
approaches do more than save money, although total sales pay may
actually be shrinking from previously inflated levels. Most important, they make sure salespeople aren't making the
wrong sales. Paying based on profit margin keeps sellers from
cutting prices just to get an order. And basing pay on customer
satisfaction means salespeople won't promise features and
delivery dates the company can't provide. |
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Brewing Big (With a Micro Soul)After 18 years of growth and with annual revenue about to break $100 million, Kim Jordan still maintains New Belgium's freewheeling spirit.
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