Laura Posey

Article Summary:

Do you think sales is a "numbers game"? Here's why you should think again.

Why Sales is NOT a Numbers Game

Make no mistake about it; the age-old wisdom that "sales is a numbers game" is a myth. At least for most businesses.

Now, there are some exceptions; Wal-Mart comes immediately to mind. So do grocery stores and other high-volume, low-margin businesses. But for the vast majority of businesses, sales shouldn't be a numbers game. In fact, that philosophy gets many companies in serious trouble.

Unfortunately, many bosses and sales managers push quantity of sales over quality with their sales teams. They fail to understand that increasing sales volume can be disastrous.

They push their salespeople to make sales; in fact, any sale will do. And therein lies the problem. That's because the wrong sale is worse than no sale at all.

Most companies have a book of business that includes three types of clients; poor-fit, good-fit and perfect-fit clients. Poor-fit clients typically represent about 20% of a company's client base.

You know when you have poor-fit clients. They are clients that represent most of your headaches. You know the ones. When you see their names on your caller ID, you cringe. Because you know that Bob is calling and he's got a problem. He always does.

It's a classic case of the 80/20 rule. Eighty percent of your customer service issues are caused by 20% of your clients; your poor-fit clients.

Poor-fit clients are clients that shouldn't be clients in the first place. They are often the result of salespeople going after and getting low-hanging fruit. It means that the salesperson isn't fully assessing the needs of the prospects to see if there is a good match.

Or if she is, she is so determined to make the sale that she's ignoring the red flags before the sale is made. It's the "over promise and under deliver" mindset that will destroy a salesperson and a company. But the fault doesn't lie solely with the overzealous salesperson.

It also demonstrates that the company's management is not focused on the right prospects, is not properly managing the sales activities of its sales team or both.

In addition to poor-fit clients, companies generally have good-fit clients and perfect-fit clients. Good-fit clients generally represent about 60% of a company's business. These are clients that are well-served and are happy with the products or services being provided.

Perfect-fit clients typically make up the remaining 20% of a company's client base. There is one key difference between good-fit and perfect-fit clients. Perfect-fit clients are raving fans and give you qualified referrals.

In other words, they help you grow your business by giving you other perfect clients. Just like them.

The sales strategy should be to fire all poor-fit clients. They take an inordinate amount of resources and are therefore your least profitable clients. In addition, because they are not a good fit, they are never fully satisfied with your products or services.

Consequently, they will only damage your credibility and your reputation. If they talk about you at all, it will be negative. And negative word-of-mouth is a sales killer.

In addition to getting rid of poor-fit clients, your sales strategy should be to convert good-fit clients to perfect-fit clients. You do that by finding out what's important to them and providing it better than anyone else. By creating better fit clients, you enhance your position which leads to more repeat business and more referrals.

And with the proper focus on the right market in the first place, your perfect-fit clients will be far more profitable. Not only will each perfect-fit client have a better margin, they will be loyal to you for the long-run.

Instead of churning through lots of low margin, poor-fit clients that will come and go based on "the best deal," you build a loyal practice of clients who are raving fans. These raving fan clients will actually help you grow your business with great referrals. So, you exchange quantity for quality and make more money.

Laura Posey is Vice-President and co-founder of Dancing Elephants Achievement Group, a Richmond-based sales development firm. Their patented system "Sales Magnetism" teaches salespeople and owners how to literally attract business to them instead of chasing after it. Their clients average a 56% increase in income in the first year and many students see over 200% increases in that time. Laura is the co-author of The 6 Secrets of Sales Magnets; How to Attract All the Business You Need. For more information, visit DancingElephants.net

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