Let's beat that sales budget

If you are the sales boss in a business this post is for you.

The achievement of sales budgets in any business is critical to that business’s profitability and longevity; not to mention the longevity of the sales boss.

A sales boss can do a number of things to help their salespeople achieve their sales budgets. Here are some of them -

Break their budgets down in to achievable ‘chunks’ of activity

We all know that the way to eat an elephant is one bite at a time. Similarly with sales budgets; the easiest way to achieve them is one chunk at a time. Here are some tips that will help –

Firstly, allocate a portion of the annual sales budget to each month of the year. This is rarely as simple as dividing the year’s budget by twelve and allocating the result to each month as that month’s sales budget. In most businesses there is a seasonality that applies to their sales results.

For example in some businesses January may be a traditionally quiet month while June may be the biggest sales month of the year. Other month’s results may also reflect seasonality. The sales boss in such a business would be wise to allocate each month’s budget accordingly.

Secondly, convert each month’s budget into a number of sales (or orders) to be achieved. This is as simple as establishing the average sale value likely to be achieved (taking into account past results) and dividing that value in to each month’s sales budget. The result is the likely number of sales that will need to be achieved in each month.

Thirdly, establish the number of proposals (or quotes) that will need to be presented to customers to achieve the necessary sales. For example, if a business ‘closes’ half of the proposals it presents it will need to present twice as many proposals as it expects to make sales.

By now your salespeople have a budget broken down into monthly chunks covering sales dollars, numbers of sales and proposals to be presented.

They can now focus, month-by-month, on presenting the required number of proposals.

(If your sales activity records are good enough you could go at least one step further and determine the number of sales calls needed to be made each month.)

Record this data on a spreadsheet to allow for easier tracking and clearer feedback.

Ensure that customers are categorized

The 80/20 Rule applies to sales in a number of ways. One of these is that generally 80% of a business’s sales revenue comes from its top 20% of customers.

A practical application of this is to categorise the business’s customers into three groups, A’s, B’s and C’s as a way of ensuring that the business’s customers get appropriate attention and service.

Most of the TLC should be directed to the business’s A class customers because it will be the sales made to them that make or break the sales budget.

Help them balance their time allocation

The 80/20 Rule also applies to salespeople’s time. If a salesperson spends 20% of their time pro-actively prospecting for new sales opportunities they generally create enough follow-through work to achieve the desired sales result. (Prospecting in this context means phoning or calling on prospective customers to secure sales appointments; but not time spent in sales appointments).

Put another way, if a salesperson spends an average of 2 hours a day setting up sales appointments with good-quality customers they will achieve a high level of follow-through activity and plenty of sales.

Unfortunately many salespeople spend considerably less than 2 hours a day setting up sales appointments. Sometimes this is due to poor self-organisation. Other times it’s caused by distractions within the business. These can occur if non-sales staff, who don’t appreciate the sales staff’s priorities, side-track them with non-sales activities like administration or service work. (Sometimes non-sales staff simply need to get out of the way and let the sales staff do the job they are paid to do.)

As the sales boss you can help by ensuring that your sales staff manage their time properly and that non-sales staff are supportive and not accidental saboteurs.

Provide regular balanced feedback

Salespeople, like everyone else, respond to feedback that’s honest, fair and balanced. Don’t be a sales boss who only gives feedback when the news is bad.

Feedback can be informal or formal. Informal feedback is the impromptu enquiry as to how things are going and the impromptu pat on the back for a job well done.

Formal feedback requires preparation by the sales boss and involves noting key points to be covered in a feedback (or review) meeting. The individual salesperson should also be encouraged to do some preparation. One way to do this is to provide them with a short self-analysis questionnaire, asking them to comment on their own performance, in advance of the feedback meeting. This will prompt them to collect their thoughts in order to make the meeting more meaningful.

Be sensitive to the ‘atmosphere’

Salespeople get best results when they work in a positive and structured atmosphere.

Make sure that all staff are positive and supportive of each other; don’t put up with whiners anywhere in the business.


(The up-coming post for Wednesday 18/2 is Make your customers feel valued. It's a reminder that the more valued your customers feel the more likely it is that they will continue to do business with you..)