The Number Side of Sales

I found George Barr’s talk today to be one of the most interesting discussions we’ve had so far. It was a refreshingly different perspective on sales, moving beyond the single prospect techniques we’ve been discussing for a major portion of the year. While everything we’ve discussed has been essential, it has all been targeted at moving a single client in some manner, moving towards a sale, moving towards an appointment, moving towards a change of some status quo. While Mr. Barr certainly agreed with these techniques and tools, he also spent some time discussing the bigger picture of sales; namely, how to determine the number of completed sales you need to achieve, and how to break down the various stages of the selling process to better understand your needs and targets, and to be able to accomplish your personal goals more successfully.

To begin with, you need to have an estimated target, you need to understand how much money you want to make and then look at the average amount of money you’ll make from a deal. From there, you simply want to follow the chain of of the sales process back up the funnel. Say your sales process has 5 distinct stages, everything from prospecting to the close – we’ll call them A through E. You have a 80% close rate between D, maybe that’s a demonstration meeting, and closing at E. If you need 50 sales to make your target, that means you need about 63 demonstration meetings. From there, you have a 80% rate of moving from step C to D, once again, you simply do the math to discover you need to perform step C approximately 80 times. You can continue to walk this chain back all the way to prospecting, and provides an extremely valuable way to estimate your performance needs in sales. Barr offered two other tips that I believe go along with this, and strengthen it. First of all, know what your aiming for – in Mr. Barr’s case this was providing for his family. Secondly, don’t get too focused on any one aspect, such as your overall “close rate.” Its arbitrary and not particularly meaningful, take a step back, look at the picture from 30,000 feet, and see the issue as a whole.