Archive for May, 2015

Cutting Sales Costs Not Revenues.

Bold companies have used the economic situation to make their sales operation not only less expensive but also more effective.

At a recent Business Exposure Group meeting, we discussed how our sales strategies have changed over the last couple of years.  We asked if employers should tinker with the sales force that gets the job done, even imperfectly.  Most people have moved away from piecemeal ongoing repairs and put in place a resource that allows the business to understand their customers and cut waste not value.

One of the members admitted to getting it wrong.  He had reduced his back office sales staff, thinking it would hurt the business less than removing some front line sales people.  The result was that the front line sales reps began undertaking support tasks.  He conceded that after a few months his business had made the support function essential to the business effectiveness and he had to go out and replace those that he had only just discarded.

The following pints were raised round the table.

  • Not all sales effort should be equal. It is important to understand how much effort really goes into each customer.  Then, considering which are the profitable customers, allocate more resource to developing them.  Understanding customers allows companies to focus sales resource where they are needed and to cut waste not value.
  • Cutting across the board risks losing quality customers and the salesforce are left without the resource to capitalise on new opportunities.
  • Do customers want and need expensive face to face interaction? A shift to telesales may increase satisfaction because it can easily develop consistent and regular contact rather than relying on reps visiting every few months both small and large clients on a rota.
  • Time spent on the road by reps should be reviewed. Rather than visiting remotely interested prospects and travelling long distances on a lukewarm lead, it is better to spend more time in the office qualifying and understanding the potential buyer’s requirements before getting in the car.
  • Companies that analyse bids and conversion rates centrally have a more confident attitude to their sales process, because they are internally applying all the lessons learned from their sales process and addressing buying queries in a professional and consistent way.
  • Squeeze out the inefficiencies after the sale. Stop sales people having to waste time dealing with mistakes.
  • Major on a client’s buying history, to decide how your sales team should operate first.
  • Consider alternatives to expensive trade fair exhibitions just to get 3 – 5 leads. Possibly a good telesales operator could get 3 – 5 leads in one morning and not over several days at an exhibition.

Many of the Business Exposure Group members felt that it was important to communicate cost cutting plans to the entire workforce.  Explain what and how you intend to make savings and then what you are going to do with the savings.  It is important to consider it from the employee’s viewpoint.  They need to know what’s in it for them, so that a strong culture of cost saving and revenue generation can be implemented from the bottom to the top of your business.


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