Archive for August, 2011

Are you setting your sales targets correctly?

Should businesses bother setting sales targets or should they simply hope for the best each month? Is it realistic to set sales targets beyond plus or minus 5% in comparison to last year?

Businesses need clear vision to enable them to meet long or short-term goals and sales targets can provide a helpful framework to measure performance and the effectiveness of sales staff.

However, many businesses rush the process and don’t pay enough attention to working out what’s realistic so the sales target can be achieved. How many managing directors or finance directors go out with their sales force to understand what issues they constantly face and  judge whether or not the targets are realistic?

One problem with setting sales targets is that it puts pressure on sales staff which can have a negative effect on productivity, with talented staff making silly mistakes just to meet their sales targets.

A proper strategy needs to be introduced to ensure sales staff ‘own’ the targets. This means they will work tirelessly to achieve them rather than pay lip service to them.

Targets that are 5%, 10% or 15% above last year are realistic in this market but when you set targets of 100% growth year-on-year you need to be realistic. To achieve 100% plus you have to be selling something completely different or reinvent the business.

It’s important to break down annual sales targets to daily or possibly weekly figures so it’s not so overwhelming. This will help your sales staff understand them. A £5k target per month is £250 per day!

One of the biggest factors to affect sales is seasonal variation and you have to take into account that August and December are difficult months. Did you take into account, for example, that this year half of April was shut down because of the Bank Holidays and the royal wedding?

Seasonal variations are very important, and will impact heavily on cash flow.

Finally, when setting sales targets companies should have a different approach for new customers, existing customers and past customers.

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How would you approach a competitor to buy their business?

Increasing market share and profit through acquisition is an appealing prospect for many business owners and can offer a fast-track opportunity for success.

But before you make your move, it’s important to do your SWOT (Strengths, Weaknesses, Opportunities and Threats) analysis to establish exactly what the purchase would bring to your business.

Until you can understand what the competitor is all about you cannot make a proper approach. Do your background homework and find out what it is that keeps your competitor awake at night, and what they don’t like about their business.

It’s a good idea to tactically position yourself so you can bump into them at trade fairs or dinners so you can have an informal chat and suss them out. Alternatively, try a third party covert approach via a solicitor or accountant.

If you really want to be alternative, try offering them your business for sale to see what reaction you get. If they indicate they have no interest in that business sector moving forward it gives you strong intelligence to begin negotiating  to purchase theirs!

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What are the benefits of holding a successful internal business meeting?

Internal meetings account for more than 60% of the meetings held within an organisation in a year which means there is a real productivity cost if they are not efficient.

Properly-run meetings save time, increase motivation and productivity, and solve problems. They can create new ideas and innovations and generally diffuse conflict in a way emails or memos cannot.

Meetings are more productive because the written word only carries 7% of the true meaning and feeling of discussion. However, most internal meetings are considered boring, a waste of time, and too long.

Preparation for internal meetings is essential. Before the meeting there needs to be a specific purpose – the idea of meetings for the sake of meetings is a waste of time. The only benefit of an internal meeting is if there is something specific to discuss.
Within these meetings you can brainstorm and can get updated on progress, consider options available to the business and build relationships.

It’s important to engage all the appropriate people in meetings and involve people who don’t necessarily have anything specific to offer, but you feel  you should include them so that they don’t feel like their nose has been put out.

It’s important to brief people on what’s expected from the meeting and produce minutes within 24 hours of the meeting. A successful meeting ‘involves’ people – rather than telling them.

Most meetings are better carried out within work time, while some are better carried outside of work time and off site, depending on the business and the pro-activity of the people attending the meeting.

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