article | December 2, 2012
3 Crucial Steps to Help Stop Chasing Bad Prospects
This call was brief, and matter of fact. The prospect was courteous, polite, and even sounded happy. But after the call, I found out that this scene was identical to one that had occurred at least 6 times before. Same outcome – no progress. I asked this sales rep what the estimated potential value of the account was. Between $20-$50K. Next I asked what he estimated the total Cost to Sell was. He didn’t know.
This is a recurring theme with sales reps. It is also one that can make the difference between a year being a success and a failure. Do you have prospects that are dragging you down? Are you wasting your time? Do you even know?
How will you be different in 2013 with your selling efforts? Two places to start:
The Cost of Chasing the Wrong Prospects
In order to improve in 2013, you need to know where to focus your efforts. By using our Cost to Sell Calculator, you can get a feel for how much effort a prospect is worth. If your effort is outweighing the potential payoff, you should invest your time elsewhere.
Salesmanship 101 tells you to invest your time where you have the most potential. However, as described above, many reps will invest their precious time chasing the wrong opportunities. With every prospect there is a point where the cost of time spent will surpass your payout. Call it the “Law of Diminishing Returns” in sales.
What criteria go into calculating the total cost of sale? Well for starters:
In addition, don’t forget about 4, 6 and 8-legged sales calls. These are the calls when you bring a manager, sales engineer, or other company resource along to support your efforts. While the Cost to Sell Calculator doesn’t account for the additional resources, you should still be mindful of those costs.
If you break your salary down into an hourly rate, the cost of these efforts becomes all the more clear. Once you know the total cost of sales, you can determine where to spend your time, and with whom. Here’s a link that provides a snapshot for quickly calculating your hourly rate.
Avoid Pitfalls and Time-Sucks
Improving your own personal sales strategy can be a difficult task. Self-assessment and self-improvement are huge obstacles to overcome. However, once overcome they can yield some of the greatest successes.
SBI can help you get started by:
Have questions about figuring out your Cost to Sale? Not sure how an Ideal Customer Profile or Account Segmentation can help you succeed in 2013? Contact SBI and we can help.