Whether you are a small business with $50k in turnover or a large business with $10 million in turnover it is important to set sales targets, each year. When setting your sales targets for the year you need to keep a few things in mind.
How much do you want your sales to grow by?
Do you want your sales to grow by 10%, 20% or even 100%. It’s important to set a number and stick to it for the year. If you make the target a large yearly amount it can be overwhelming and you may not make these targets before you even start due to the overwhelming size.
However, if you break down this amount to a monthly or weekly sales target these amounts can be more manageable and less overwhelming helping you actually achieve your sales target.
Tracking Your Sales Targets
Once set it is really important to track these targets. Whether you do this weekly or monthly, you need to be aware of the position you are in and how you are performing compared to your projections.
If you fall behind in your sales targets you will need to get creative and come up with a way to meet these targets.
How are you going to meet your sales targets?
I often have clients advise that they cannot set sales targets as they can’t control what income they achieve. My answer is that you can’t always control the exact result but what you can control is ensuring that you are undertaking enough activity to achieve the target. That is, if the goal is to increase 200% but you don’t change anything you have previously done how do you expect the increase to happen?
Initially, you need to plan what you may be able to sell per below as this will influence your activities:
- Selling products/services to new customers
- Selling more of a product/service to existing customers (upselling)
- Selling an existing product to current customers that they are not purchasing
- Introduction of a new product or service to sell to current and existing clients
Your customer database is one of your most important assets and you should be using it to your best advantage as selling to existing customers is cheaper and generally easier than attracting new clients.
While some of your sales targets will come from existing customers you will need to bring in new customers.
Creating New Sales Leads
The question you need to ask yourself is how are you going to create new leads and bring in the new customer?
1. Marketing is one of the obvious ways;
- This could be tweaking your website
- Strategic advertising for your services and products.
- Networking to meet your ideal client
- Newsletters to clients about your products/services
- Meeting with referral sources
2. Review of your sales process is another area to review.
- What percentage of leads are you converting?
- Are your clients aware of all your products/services?
- Are your clients coming back to purchase products/services?
As with anything though it is important that you have prepared your budget to ensure that implementing the above strategies are going to benefit the business with increased profits.
If you are putting on new staff or have increased costs such as rent for additional space etc., have you actually increased your sales targets enough to cover these costs? When setting your targets be sure to take into account the increased costs associated with these and make sure you will be making money from the increase in sales.
Next month we will discuss looking at the profit of products/services that you sell and how you can do this to help with your business planning.
If you need help with your setting sales targets please feel free to contact our office.