Sales Best Practice #36 – Accurately measures the potential in each account

Posted by Dave Kahle on September 15, 2014 under Sales Training | Be the First to Comment

Sales Best Practices #36 – Accurately measures the potential in each account

By Dave Kahle

Every day, salespeople are confronted with the necessity to make these three time management decisions well: Where to go? Who to see? What to do?

The master salesperson understands that consistently making those decisions well will, more than any other one thing, determine his/her success.

In order to make those decisions well, you need to collect good information. And one essential piece of good information is the potential for purchases in each of your accounts. I call this QPC (Quantified Purchasing Capacity).

QPC is the answer to this question: If this account bought everything they could from me over the next 12 months, how much would that be? The answer to that question is a dollar amount, and that figure is a necessary part of the information that a salesperson needs in order to make good decisions about the investment of his/her sales times.

Don’t confuse QPC with historic sales. QPC has nothing to do with how much they bought from you last year. It has everything to do with how much they could purchase from you in the coming year. It should be accurate, specific and quantifiable. In other words, you ought to have a defendable answer to that question for every account.

You don’t estimate QPC; you collect it. The number that answers that question exists in every account today. The master salespeople understand that, and seek to collect it from every account, every year.

They use a combination of several techniques to assure themselves that they are accurately collecting QPC. First, they simply ask their customers. Many, maybe 50 percent of them, will have that number and will be willing to share it.

Businessman hand drawing graph by twobee at freedigitalphotos.net

The remainder may not be sophisticated enough to have it, or will have it and don’t think you should have it. In those cases, the master salesperson creates or finds some formulas that accurately calculate the QPC based on other measurable variables within the account. For example, people selling to plumbing contractors can create the QPC for each contractor by multiplying the number of trucks on the road by a certain factor. People selling to schools can calculate supply needs based on the number of students. And so it goes. There is almost always some variable that can be collected, measured, and calculated to turn into a defendable rendering of QPC.

In some industries, the QPC is available from sources that collect and sell that information. You may be able to buy it.

One way or another, the master salesperson collects QPC. Equipped with an accurate rendering of QPC for every account, the master salesperson is then equipped to make much better decisions about the investment of sales time. That, more than any other single decision, will impact your success. The masters know that, and seek to collect QPC for every account. That’s why they are the best.

For more resources on this best practice see:

a. Chapter Four of How to Excel at Distributor Sales

b. Chapter Three of Take Your Sales Performance Up a Notch

c. Chapter Five of Eleven Secrets of Time Management for Salespeople

d. Tools number 20, 21 and 22 of Time Management Tool Kit

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About the author:

Dave Kahle is one of the world’s leading sales authorities. He’s written twelve books, presented in 47 states and ten countries, and has helped enrich tens of thousands of sales people and transform hundreds of sales organizations. Sign up for his free weekly Ezine.

His most recent book, How to Sell Anything to Anyone Anytime, has been named one of the “five best business books,” by three international entities.

All rights reserved

Image by twobee / freedigitalphotos.net

The Five Most Common Mistakes Salespeople Make

Posted by Dave Kahle on September 9, 2014 under Sales Training | Be the First to Comment

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Over the decades that I’ve been involved in sales, I’ve worked with tens of thousands of sales people. Certain negative tendencies — mistakes that sales people make — keep surfacing. Here are my top five. See to what degree you (or your sales force) may be guilty of them.

Mistake Number One: Over concern with strategy instead of tactics

Gather a group of sales people together around a coffee maker and listen to the conversation. After the obligatory complaints about all types of things, the conversation inevitably drifts to questions of strategy. How do I accomplish this in that account? How do I get this account to do this?

In my seminars, I often hold a “clinic” where sales people write down any sales-related question and submit it to the group for discussion. These questions are almost always related to strategic issues. In one form or another, they ask the same question: How do I achieve this effect in this account?

While this thoughtfulness is encouraging, it reveals an erroneous mindset. The belief behind these questions is this: “If I can only determine the right sequence of actions of my part, I’ll be able to sell this account, or achieve this goal.”

This, unfortunately, is rarely the case. These sales people, based on this erroneous belief, are looking for a solution in the wrong place. Almost always, the answer to the question is not a more clever strategy, but better execution of the basic tactics.

It is like the football team whose players don’t tackle well, miss their blocks, throw erratic passes, and fumble frequently. The solution is not a more clever game plan. The solution is better execution of the basic tactics. Learn to do the basics effectively, and the strategy will generally take care of itself.

The real problem with this over-concern for strategy is that it seduces the sales person’s energy, substituting the pursuit of a better strategy for the real solution – better execution of the basics.

When I’m asked these “strategy” questions, I find myself asking the sales person to verify the fundamentals. Have you identified the key decision makers and influencers in the account? Have you created trusting personal relationships with each of them? Have you understood the customer’s situation at a deep level? Have you presented your solution in a way that gives them reason to do business with you? Have you effectively matched your proposal to the intricacies of the customer’s needs?

This line of inquiry almost always reveals a flaw in tactical execution. It’s not the strategy that is the problem, it’s the tactics. Focus on doing the basics first, and the need for a clever strategy diminishes.

Read how to overcome this tendency in the expanded version of this article here.

Mistake Number Two: Lack of thoughtfulness

The typical field sales person has, as a necessary and integral part of his/her personality, an inclination toward action. We like to be busy: driving here and there, talking on our cell phones, putting deals together, solving customer’s problems — all in a continuous flurry of activity. Boy, can we get stuff done!

And this high energy inclination to action is a powerful personality strength, energizing the sales person who wants to achieve success.

But, like every powerful personality trait, this one has a dark side. Our inclination to act often overwhelms our wiser approach to think before we act.

In our hunger for action, we neglect to take a few moments to think about that action. Is this the most effective place to go? Have I thoroughly prepared for this sales call? Do I know what I want to achieve in this call? Is this the person I should be seeing, or is there someone else who is more appropriate? Is it really wise to drive 30 miles to see this account, and then backtrack 45 miles to see another?

Customers these days are demanding sales people who are thoroughly prepared, who have well thought-out agendas, and who have done their research before the sales call. All of this works to the detriment of the “ready-shoot-aim” type of sales person.

On the other hand, those who discipline themselves to a regular routine of dedicated time devoted to planning and preparing will find themselves far more effective than their action-oriented colleagues.

Read how to overcome this tendency in the expanded version of this article here.

Mistake Number Three: Contentment with the superficial

There are some customers on whom you have called for years, and yet the sales person doesn’t know any more about them today than he/she did after the second sales call. These are accounts where the sales person cannot identify one of the account’s customers, explain whether or not they are profitable, or identify one of their strategic goals.

Most sales people have a wonderful opportunity to learn about their customers in deeper and more detailed ways, and often squander it by having the same conversations with the same customers over and over. They never dig deeper. They mistake familiarity with knowledge.

What a shame. I am convinced that the ultimate sales skill — the one portion of the sales process that, more than anything else, determines our success as a sales person — is the ability to know the customer deeper and in a more detailed way than our competitors know them.

It’s our knowledge of the customer that allows us to position ourselves as competent, trustworthy consultants. It’s our knowledge of the customer that provides us the information we need to structure programs and proposals that distinguish us from everyone else. It’s our knowledge of the customer that allows us to proactively serve that customer, to meet their needs even before they have articulated them.

In an economic environment where the distinctions between companies and products are blurring in the eyes of the customer, the successful companies and individuals will be those who outsell the rest. And outselling the rest depends on understanding the customer better than anyone else.

Read how to overcome this tendency in the expanded version of this article here.

Mistake Number Four: Poor questioning

This is a variation of the mistake above. I am absolutely astonished at the lack of thoughtfulness that I often see on the part of sales people. Most use questions like sledge hammers, splintering the relationship and bruising the sensibility of their customers by thoughtless questions.

Others don’t use them at all, practically ignoring the most important part of a sales call. They labor under the misconception that the more they talk, the better job of selling they do, when the truth lies in exactly the opposite approach.

And others are content to play about the surface of the issue. “How much of this do you use?” “What do you not like about your current supplier?” Their questions are superficial at best, redundant and irritating at worst.

The result? These sales people never really uncover the deeper more intense issues that motivate their customers. Instead, they continually react to the common complaint of customers who have been given no reason to think otherwise: “Your price is too high.”

Fewer sales, constant complaints about pricing, frustrated sales people, impatient managers, and unimpressed customers – all of these as a result of the inability to use the sales person’s most powerful tool with skill and sensitivity.

Read how to overcome this tendency in the expanded version of this article here.

Mistake Number Five: No investment in themselves.

Here’s an amazing observation. No more than 5% of active, full time professional sales people ever invest in their own growth. That means that only one of 20 sales people have ever spent $20.00 of their own money on a book on sales, or subscribed to a sales magazine, taken a sales course, or attended a sales seminar of their own choosing and on their own nickel.

Don’t believe me? Take a poll. Ask your sales people or your colleagues how many of them have invested more than $20.00 in a book, magazine, CD, etc. in the last 12 months. Ask those who venture a positive answer to substantiate it by naming their investment. Don’t be surprised if the answers get vague. You’ll quickly find out how many sales people in your organization have invested in themselves.

Sales is the only profession I know of where the overwhelming majority of practitioners are content with their personal status quo.

Why is that? A number of reasons.

Some mistakenly think that their jobs are so unique that they cannot possibly learn anything from anyone else.

Still others think they know it all. They have, therefore, no interest in taking time from some seemingly valuable thing they are doing to attend a seminar or read a book.

Some don’t care. Their focus is hanging on to their jobs, not necessarily getting better at them.

But I think the major reason is that the overwhelming majority of sales people do not view themselves as professionals and, therefore, do not have professional expectations for themselves. They worked their way up from the customer service desk or they landed in sales by chance, and they view their work as a job to be done, not a profession within which to grow.

They are content to let their companies arrange for their training or development. And between you and me, they would prefer that their companies really didn’t do anything that would require them to actually change what they do.

Challenge yourself, show some motivation, goals, and determination

Read how to overcome this tendency in the expanded version of this article here.

These are the five most common negative tendencies that I see. It may be that you and your colleagues are immune to these dampers on success. Good for you. But if you are not immune, and if you spot some of your own tendencies in this list, then you are not reaching your potential for success. You have tremendous potential for success — for contentment, confidence and competence – that is being hindered by these negative behaviors. Rid yourself of these negative tendencies, and you’ll begin to reach your potential.

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About the Author:

Dave Kahle is one of the world’s leading sales authorities. He’s written twelve books, presented in 47 states and ten countries, and has helped enrich tens of thousands of sales people and transform hundreds of sales organizations. Sign up for his free weekly Ezine. Check out our Sales Resource Center for 455 sales training programs for every sales person at every level.

You may contact Dave at 800-331-1287, or dave@davekahle.com.

Image by Stuart Miles/FreeDigitalPhotos.net

Sales Q&A – How to manage customers calling at night?

Posted by Dave Kahle on September 2, 2014 under Sales Training | Be the First to Comment

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Q.  Dave, how can a sales person have a life at night and not be reactive to customers calling at night – seven or eight per night?

A. This is really a time management issue. I have a hard time imagining why you would need to receive seven or eight calls every night from customers. I think the issue lies in your view of what the job of the sales person really is, and what strategy best brings success to the sales person.

A lot of sales people view themselves as merely extensions of the company’s customer service operations. In other words, they believe that the reason their customers do business with them is because they (the sales person) bend over backwards to respond to every whim of the customer. These sales people then inadvertently train their customers to call them with every problem and need they have. Many times, many of these calls and problems could and should have been better directed to the company’s customer service representatives.

This is a common trap that sales people, particularly new sales people, fall into. In an effort to fill up their days, to be seen as important to the customer, the sales person becomes the ultimate lap dog, dutifully chasing after every whim and responding to every request of the customer. That creates a huge list of “things to do” for the sales person, which makes him/her very busy and feeling needed.

Man with laptop by ambro at freedigitalphotos.net

However, it is a miserable and unwise way to define and go about your job. The sales person should be seen as a professional consultant to the customer. Someone who cares about the customer’s business, who creates and presents creative solutions to the customer’s deeper needs.

Questions and issues about back orders, invoice problems, delivery dates, pricing on routine orders, etc. are all more appropriately handled by an inside sales person or customer service representative.

A sales person does himself no good in the long term by attempting to handle every customer question or issue. If you train the customer to call you for every possible issue, think about what message you are sending to the customer. You are, in effect, say, “Sir, my company has no reliable people other than me. We have no effective systems. That’s why I have to handle every call. Without me, the company would be worthless.”

As a buyer of goods and services, from my perspective, I wonder how substantial a vendor’s business is, and how good a vendor’s sales person is, if I can’t get my routine issues taken care of by a customer service representative. If the sales person has to call back to handle every question, I really wonder about the value of that sales person and the reliability of that company.

So, the real issue is how you define your job. Are you a lapdog, responding to every whim of the customer, or are you a professional, capable and wiling to respond to the customer’s expressed needs?

Once you resolve your definition of the job and how you want to position yourself, then the answer to the question above becomes clearer. If you want to be the customer’s lap dog, then rejoice that you are getting seven or eight calls per night. Gives you something to do, keeps you busy, and makes you feel important.

However, if you view yourself as a professional, then you need to train your customers to take the routine issues to your customer service or inside sales group, and use the time with you for more substantial discussions of their needs and your solutions.

Retrain your customers. Give them your company’s 800 number and directions for what kinds of issues to take to the inside staff. Stop answering your phone after 5 PM. You deserve to have a life, too. But you must train your customers to respect that.

Expose yourself to the best practices of the best sales people. Learn how to do this job well. Consider the Kahle Way® Selling System course. Learn more here.

Image courtesy of ambro/freedigitalphotos.net

First Impressions: 5 Things Not to Screw Up

Posted by Larry Caretsky on August 29, 2014 under Sales Training | Be the First to Comment

Business woman shaking hands with a clientProfessional sales tips by Larry Caretsky.

All it takes is seconds for people to start forming a picture of who you are. Make sure they like what they see.

Read more: First Impressions: 5 Things Not to Screw Up | Inc.com

Image “Business woman shaking hands with a client” courtesy of stockimages/FreeDigitalPhotos.net

Sales Best Practice #14 – Creating rapport with new contacts

Posted by Dave Kahle on August 26, 2014 under Sales Training | Be the First to Comment

Best Practice #14: Is good at quickly creating rapport with new contacts.

By Dave Kahle

I like to break the sales process down into its simplest components:

  1. Engage with the right people.
  2. Make them comfortable with you.
  3. Find out what they want.
  4. Show them how what you have gives them what they want.
  5. Get an agreement on the next step.
  6. Follow up and leverage satisfaction.

One of the essential early steps is to “make them comfortable with you” in other words, to create some rapport with the other person.

Trust is essential in creating rapport with your customers

According to the dictionary, rapport is “an emotional bond or friendly relationship between people based on mutual liking, trust and a sense that they understand and share each other’s concerns.

We can understand why this is so important. If your contact doesn’t feel comfortable with you, then he/she won’t be nearly as open to sharing information. And, if we can’t get information, we can’t “find out what they want.” We all have stories to tell about an incident in which we were the buyer and a sales person was rude or self-interested to the point where we decided to terminate the relationship and go somewhere else.

The same thing is true of our customers. If they don’t feel comfortable with us, if they don’t feel that we are interested in them, they form negative impressions of us and consider some other source.

I’m surprised by the quantity of sales people who get this exactly wrong. They’ll talk about a customer and say something like, “he’s a really nice guy,” as if that mattered.

Their first reaction of the immature sales person is to judge the customer by his/her own feelings about the customer. That’s exactly backwards. It doesn’t matter how we feel about the customer. What does matter is how the customer feels about us.

And, it is the responsibility of the professional sales person to interact with the customer in such a way as to make this particular human being comfortable with us.

Not surprisingly, the best sales people are masters of creating rapport with all kinds of people, understanding that it is the essential first step in a successful interaction with a customer. The average sales person never takes the time to study this issue, instead relying on his or her hit-or-miss people skills developed outside of the job. The average sales person views the customer through his/her reaction to the customer, whereas the best sales people understand that it is their job to create rapport with the customer.

Like so many specific aspects of the sales person’s job, there is no magic, no secret to this task. Creating rapport is a widely researched issue, and best practices for doing this well are widely described.

To understand some highly effective ways of accomplishing this:

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About the author:

Dave Kahle is one of the world’s leading sales authorities. He’s written twelve books, presented in 47 states and ten countries, and has helped enrich tens of thousands of sales people and transform hundreds of sales organizations. Sign up for his free weekly Ezine.

His most recent book, How to Sell Anything to Anyone Anytime, has been named one of the “five best business books,” by three international entities.

All rights reserved

Image courtesy of Stuart Miles/FreeDigitalPhotos.net

The sales conversation is changing—have you kept up?

Posted by Michael Boyette on August 21, 2014 under Sales Training | Be the First to Comment

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Are you having the same old, same old conversations with customers and prospects? Ones that start like these:
Woman using smart phone by patrisyu at freedigitalphotos.net

Tell me about your business

Let me tell you about my product

Just checking in 

How’s it going?

Not much; what’s new with you?

These are antiquated conversation openers that go back to the days when customers brought in salespeople to learn about services, products and solutions. Today, these kinds of conversations are ones that neither you nor your buyer need. You can and should learn about their business before the conversation begins. They can do the same for your products and services. If you’re just checking in, you can text.

Buyers still want to talk to you, but not about that stuff. Today’s conversations start where the old ones left off. You need to come to the table already an expert — with knowledge of the customer’s company, its competitive environment, and the stakeholders involved in the buying decision.

Where to next?

And then you need to take the conversation somewhere that leaves the customer thinking, “Wow. I got a lot more out of that conversation than I expected.”

You want conversations that buyers will remember. That will set you apart from other salespeople. That will unlock new opportunities or get your buyer thinking differently.

Here are four fresh kinds of conversations you can have with prospects and customers:

Futuring.

Customers are looking to you for insight that goes beyond what they already know, to help them solve not only their current problem, but emerging business challenges. Futuring conversations help you (and sometimes buyers themselves) understand where things are headed. The goal isn’t prediction. It’s to learn the buyers’ vision of the future as they understand it today, and to explore what they need to do right now to prepare for it.

Success is target by parkorn at freedigitalphotos.net

Some questions to get the ball rolling:

  • Where do you expect this organization to be in five years?
  • What are you doing to prepare for ______ (insert an emerging industry trend)?
  • What will be the biggest threat to your business in the next year?

Heat-mapping.

The goal of this conversation is to identify top-priority business issues. This isn’t a conversation limited to your products and solutions; it takes a step back to look at what issues are attracting attention and resources in the organization.

Business graph by hywards at freedigitalphotos.net

Some questions to ask:

  • What topics are getting the most discussion in management meetings these days?
  • Where are you spending the most money?
  • What’s driving revenue and growth?
  • What problems keep coming up despite your best efforts to solve them?

Phasing.

These conversations are designed to help you better understand buying cycles, so you can get plugged in sooner. Back in the old days, buyers got salespeople involved early in the buying cycle, because that was the only way they could get the information they needed. Now buyers can do their research anonymously on the Internet, and they tend to invite salespeople in only at the end. The buying cycle is still there, but much of it is invisible to salespeople – unless you ask.

Business opportunities by basketman at freedigitalphotos.net

Questions:

  • What projects are you working on that are still in the early phases?
  • What issues are you just now starting to look into?
  • What’s in your development pipeline?
  • What do you see on the horizon that you feel you need to know more about?

Linking.

These conversations create emotional links between the customer and you, what you sell, and the company you work for. It’s important to make the business case, but equally important to connect person to person.

two corporates discussing business over snacks by stockimages at freedigitalphotos.net

You might say:

  • How do you feel about what I’ve proposed?
  • What will it mean to you personally if we can find a solution to this problem?
  • I was really excited when I saw the results of our field trials.
  • It’s fun to work with your organization, because you challenge me to do my best.

These are different conversations from the ones you may be used to having. They require a greater depth of knowledge and insight. And they may take you in unexpected directions. They may uncover opportunities that more predictable conversations never will. Even more important, they differentiate you from all those other salespeople who play it safe, and get your buyer thinking of you in a new and better light.

Adapted in part from “Changing the Sales Conversation,” by Linda Richardson. To learn more, visit www.lindarichardson.com

About the Author:

Michael Boyette is the Executive Editor of Rapid Learning Institute and thought leader for the Top Sales Dog blog.  He is a nationally recognized authority on selling and has written hundreds of articles and training programs for sales reps and sales managers.  Michael has managed programs for US Healthcare, Bell Communications Research, and DuPont.  Connect with Michael via Twitter @TopSalesDog.

Image “woman using smart phone” by patrisyu/freedigitalphotos.net

Image “success is target” by pakorn/freedigitalphotos.net

Image “business graph” by hywards/freedigitalphotos.net

Image “business opportunities” by basketman/freedigitalphotos.net

Image “two corporates discussing business over snacks” by stockimages/freedigitalphotos.net

Best Practices for Sales People

Posted by Dave Kahle on August 18, 2014 under Sales Training | Be the First to Comment

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One of the most debilitating myths about the sales profession is that sales people can learn on their own, on the job, and eventually become good at their jobs. This myth implies they’ll eventually develop their own style, and that will bring them the maximum results.

That myth is true for about five percent of the sales people in the world. For the other 95 percent, nothing could be further from the truth. The overwhelming majority of field sales people perform at a fraction of their potential because they have never been systematically exposed to the best practices of their profession. Instead, they have been expected to “learn on their own.”

I like to paint. I don’t mean pictures, I mean walls and bedrooms and hallways. I enjoy the physical nature of it, and the resulting change in the feeling of the room. Once, for about two months, I actually made a living doing it. I think I’m pretty good at it.

Until a little while ago, when I was watching one of those reality home improvement shows. On it, a professional painter demonstrated the best way to apply masking tape, hold a brush and apply the paint. Yikes! I was doing it all wrong.

All this time I thought I was pretty good, in my own self-taught, learn-on-my-own sort of way. I guess I really didn’t have any standard. But I almost always painted by myself, and had only my own opinion. I thought I was pretty good compared to what I thought was good.

Then, when I discovered the best practices of a true professional, I saw that my own ideas we not up to the standard. I wasn’t nearly as good as I thought I was. If I’m going to become really good — objectively, verifiably good — I have to change my routines and incorporate the best practices.

So it is with sales as well. The world is full of sales people who have learned on the job, pretty much on their own, and have never been exposed to the best practices of the profession. They delude themselves, as I did, holding the opinion that they are pretty good. And that delusion keeps them lingering in levels of performance considerably beneath what their potential would allow them.

Sales managers often share that delusion, and occupy themselves with other matters, unable or unsure how to improve the performance of their team. Typically, the sales manager was, in a previous incarnation, a high performing sales person. He/she was part of the five percent who learned on their own, who studied the best practices, and who incorporated them into his routines. As a result, that sales manager, formerly high performing sales person, expects every other sales person to be just like him; to have the same motivation, the same drive, the same ability and propensity to learn. He, therefore, makes little effort to expose the sales team to best practices, because he did it on his own.

That’s too bad. Every profession in the world develops a body of knowledge about the best way to do that job. And every professional in the world is expected, if they are serious about the profession, to regularly study those best practices, and to incorporate them into their routines with a disciplined, methodical effort. That’s why teachers have in-services, doctors go to conferences, nurses have in-service training, etc.

Teacher Holding Book and Focus At Blackboard by iosphere at freedigitalphotos.net

This article is available in an expanded version on our blog. Post your comments there.

The job of the sales person is no different. There is probably no other profession where more is written about, and to, than field sales. Over the last 50 years, there must have been thousands of books written, tens of thousands of articles published, thousands of audio programs prepared, and hundreds of newsletters and magazines published – all for the field sales person, and all describing the best practices of the profession in various terms and methods.

Just as there is a set of best ways to paint a room, so there are sets of best ways to ask a question, seek an appointment, build rapport, make a presentation, close the deal, and follow up on the purchase. Astute sales people understand this, and seek to continually expose themselves to the best practices. Astute sales managers do likewise. They continually expose their sales people to the best practices of the profession, and encourage every sales person to improve by methodically incorporating them into their routines. Those companies that systematically and methodically expose their sales people to the body of knowledge regarding best practices of the sales profession consistently out-perform those who don’t.

It is the path to improvement that the rest of the professional world understands. It’s time for the sales profession to do likewise.

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If you are serious about learning the best practices of your profession, consider a subscription to the Sales Resource Center; 20 years of Dave Kahle’s wisdom and insights for one low monthly fee.

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Sales Q&A – How to handle backorders

Posted by Dave Kahle on August 11, 2014 under Sales Training | Be the First to Comment

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Q. I recently gained an order from a new customer for 10 items. We back ordered four of the ten. My customer is quite upset with me and my company’s purchasing agents. Our relationship is strained because of someone in my company’s poor performance. What would you do?

A. Ah. The proverbial “backorder” problem. What would we talk about if we couldn’t complain about backorders?

First, let’s recognize that the problem is as old as the job of the sales person, and we will have to deal with this problem until the day we retire. The problem is a result of conflicting pressures. On one hand, your company only has so much money and space, and just can’t buy and hold or produce everything in the hopes that someone somewhere will eventually buy it. As a sales person, however, you want everything available instantly. So someone is always going to be disappointed.

Throw in the fact the customer probably doesn’t want to pay anything but the lowest possible price for the product, and you can see that there is an inherent tension here. If the customer would be willing to pay twice as much for the product, your company could afford to build huge inventories. But, since that is unlikely to happen, your company needs to control its investment inventory so that the company has a chance of making money. In other words, you are always going to have some backorders!

OK, so what do you do about them? The first thing is to prevent them with clear communication and appropriate expectations. Don’t assume that because you backordered a customer that means that your colleagues are uncaring or incompetent. That rarely is the case.

For example, if your company has been routinely selling about 100 of a certain item each month, and you bring in a new customer with an order for 20, it’s unreasonable for you to expect your new sale not to cause someone some problem. The sudden increase in demand from 100 to 120, without any prior notice, will probably mean that someone is going to get backordered.

Balancing Supply and Demand to Avoid Backorders

The problem wasn’t the poor job your purchasing colleagues did; it was the sudden increase in demand brought on by your new order. Further, if you promised the customer immediate delivery on an item he is ordering for the first time, you probably created unreasonable expectations in your customer’s mind, and promised something that you could not really deliver.

It would have been more reasonable to have promised the customer a two or three week delivery on the first order, and to have informed your purchasing person of the coming increase in demand.

Many backorder problems can be prevented by using these two practices: 1) good communication with your purchasing people, and 2) reasonable expectations to the customer.

But what do you do if you are consistently plagued with a quantity of backorders that seem unwarranted? Go first to your purchasing people with respectful inquiries and a detailed description of the problem. No vague generalities or “sales person’s talk” here. Be detailed and specific with the problems and the consequences of those problems.

If you don’t get satisfaction, then bring the problem, in the same respectful and detailed fashion, to your manager.

Finally, if you still don’t see positive improvements, and if the backorder problems continue to jeopardize your ability to service your customers, then at some point you need to consider whether your continued employment with this company is the wisest choice for you.

 Access 25 years of wisdom and practical, proven advice – like this – online 24/7 for one low monthly fee. Learn more here.

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About the Author:

Dave Kahle is one of the world’s leading sales authorities. He’s written twelve books, presented in 47 states and ten countries, and has helped enrich tens of thousands of sales people and transform hundreds of sales organizations. Sign up for his free weekly Ezine. Check out our Sales Resource Center for 455 sales training programs for every sales person at every level.

You may contact Dave at 800-331-1287, or dave@davekahle.com.

 Image courtesy of arztsamui/freedigitalphotos.net

Selling Confidence: How Optimism Can Bolster Your Sales Team

Posted by Larry Caretsky on July 31, 2014 under CEO Corner, Sales Training | Be the First to Comment

Sales management tips on BusinessNewsDaily.com

Excerpt below:

Business News Daily logo

Inspiring optimism in your sales team isn’t always easy, but you can do it with the right techniques. Caretsky shares three tips for helping your team take the “glass half full” approach to its work.

Retrain worn-down employees. Constant rejection when making a few dozen calls a day can take its toll on even the most optimistic person…

Click here to read the full article on BusinessNewsDaily.com

Sales Best Practice #13 – Inside Relationships

Posted by Dave Kahle on July 18, 2014 under Sales Training | Be the First to Comment

Relationships with inside people, a best sales practice by Dave Kahle.

By Dave Kahle

Best Practice #13:  Has an excellent relationship with customer service, purchasing and all the support staff inside his/her organization.

This is such an important practice that I have named it one of my top eleven time management strategies. If you have the book, Eleven Secrets of Time Management for Salespeople, you’ll see that it is secret number nine.

I had to learn this the hard way. I was a heavy-hitting, driven sales person. I’d stop into the office, drop off work for everyone, and head back out to my territory. I just assumed that everyone would do the jobs that I had deposited on them. My task-oriented style put a number of people off, and my operations manager warned me that I was creating ill-will among the office staff.

It took a while, but I finally decided that I needed them to be on my side. So, I apologized, bought everyone a gift, and tried to re-start the relationship on a more positive basis. As people gradually came over to my side, I found that I was able to be far more productive.

Instead of doing a project myself, I could confidently ask someone inside to do it for me. Since they liked me, they didn’t mind. Instead of expediting a back order myself, I could have someone else do it. Instead of walking a new and complex order through the system, I could have someone else do it.

Job Allocation by pakorn at freedigitalphotos.net

I discovered that many of the tasks that I previously had done myself could be done just as effectively and much more efficiently by someone else. That freed up my time to do what I did best – visit my customers and sell my company’s products. As a result, I was much more effective.

That’s why this is one of the best practices of the best sales people. The average sales person creates an overwhelming list of tasks to perform and things to do which then weigh him/her down and decrease the amount of time spent with customers. The exceptional sales person creates relationships, not tasks, and influences those people to do the tasks for him. In so doing, he/she multiplies his effectiveness and dramatically increases the amount of time spent with customers.

It’s a best practice of the best sales people.

To learn more about how to do this, read chapter nine of Eleven Secrets of Time Management for Salespeople.

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About the author:

Dave Kahle is one of the world’s leading sales authorities. He’s written twelve books, presented in 47 states and ten countries, and has helped enrich tens of thousands of sales people and transform hundreds of sales organizations. Sign up for his free weekly Ezine.

Check out our Sales Resource Center® for 455 audio and sales training programs for every sales person at every level. You may contact Dave at Kahle Way® Sales Systems, 800-331-1287, or dave@davekahle.com.

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Image courtesy of parkorn/freedigitalphotos.net