The goal of a sizing analysis is to ensure the size of a sales force correlates with market dynamics by matching selling capacity to actual demand. Doing so will ensure highest revenue potential and sales cost optimization.
When assessing your sales force, there are a few simple tests that provide keen insight into whether you are deploying the optimal sales force size to meet the market demand. These include
- Sales Force Morale Test
- Customer Test
In addition to these straight-forward assessments, it is also critical to ensure there is alignment between your Sales Strategy and the number of reps you deploy into the market place. As the Sales Operating Plan, a company’s sales strategy allocates resources efficiently to drive selling costs down and revenues up.
As market dynamics change, so should a sales strategy. Effective sales strategies consider three (3) inter-related life cycles: Industry, Company and Product. Each follows the typical progression of Growth, Maturity & Decline. Understanding where you are in the life-cycle will impact how you deploy resources.
Here are some examples…
- A company in a high growth industry launching a new product would increase headcount to capture market share and out-shout the competition
- A mature company in an established industry may strategically deploy more reps in certain territories to seize market share from the competition
Key Takeaway: Understanding the marketplace is the key to properly sizing your sales force. As the marketplace changes so too does a company’s sales strategy. Aligning your sales strategy with the life cycle of your industry, business and product will ensure you deploy resources to meet actual market demand.
Download our sales force sizing research findings whitepaper to learn more about how world-class companies determine sales capacity through ‘tests’.