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Overcoming the 10 Toughest Sales Barriers
Sales management experts point out the issues your sales team must be prepared to confront and overcome
by John Hoskins and Glenn Jackson, co-founders of Advantage Performance Group
Just when you thought you had selling figured out, it got harder. The world shrank as global competition grew. Customers demanded more. Technology sped up everything. It seemed as though the rules of the sales game had suddenly changed.
Precisely because selling has gotten so much tougher, the new breed of sales managers is inventing new ways to stay successful.
What's the secret? Taking a hard look at what's really blocking your sales efforts. Then developing strategies, long-term tactics, and personalized support to keep your sales team ahead of barriers—nimble, able to anticipate customer needs, and performing far ahead of your competition.
What follows will help you become a successful sales manager. They are ten barriers you can overcome—if you begin now to think strategically about the way you sell and service customers.
Ten Barriers
Advantage Performance Group recently asked 20 sales management experts around the country to identify the critical issues blocking sales efforts. Some barriers they cited are driven by the external environment. Some are driven by internal policies and procedures. All are red flags that make your job and your sales people's jobs more difficult. And all require immediate strategic thinking.
Issues from Outside the Company
1. Lack of Product Loyalty
Blame technology. Customers believe that a better chip, cereal, or airfare will be available tomorrow. And they're right. Product life cycles are shorter across the board. That means you have to spend more time and resources wooing customers so they'll retain your products and ignore others.
Implications for the Way You Sell: Sell product and that's all you'll have time for because you'll have to sell over and over. But build long-term partnerships and you only have to sell once. Partnership-building isn't easy. It requires knowledge, effort, and the skill and infrastructure to provide customers with value-added intangibles such as extraordinary post-sale service and informed consulting. But partnerships, not products, are the key to customer loyalty and retention. Teach your sales team how to earn the right to be at the planning table with customers so that when alternative suppliers approach, the emotional, economic and system costs of switching to the competition will be prohibitive.
2. Crowded Playing Field
Today's global competition has crowded the playing field. More competitors are offering what customers want. They are also probably learning from your success, copying your winning products and services, and even offering pricing, guarantees, and service support like or better than yours.
Implications for the Way You Sell: Differentiate, or else! And communicate how you're better. Sales people need to understand your strengths as well as the soft underbelly of your competitors' weaknesses to sell your competitive advantage. And don't forget that the salesperson may be your single best point of differentiation. Invest in making everyone on the sales team leading-edge.
3. Bigger Wins and Bigger Losses
Customers are reducing suppliers because a handful of partners makes more economic sense than an army of vendors. The effect on your sales team is bigger, more lucrative deals, and fewer of them. This raises the stakes. The time and expense you invest in going after large deals can be astronomical. And if you lose the deal, you lose it for a long, long time.
Implications for the Way You Sell: Winning the big deals requires team selling, utilizing a combination of sales specialists and generalists. The downside is that team selling requires careful management and organization. The upside is that it can get you deep into a prospect organization and help you build critical pre- sale relationships with decision-makers and influencers. And while you're thinking big, don't hesitate to "fire" less lucrative customers who sap precious sales resources. Reinvest those resources in acquiring large accounts. Remember that you want to be a long-term partner with a few large customers rather than a short-term vendor to a lot of small ones.
4. Customers Buy Value
Customers may say they want lower prices or higher quality. But post-sale research continues to show that price is at best number 3 or 4 on the decision criteria list of user technical buyers. Value is what improves customers' bottom line. How important is price to your sale? How can you prove value?
Implications for the Way You Sell: Winning companies aren't in the business of selling product—they're in the Òvalue business." Examine your customers' business objectives and find the combination of service, product features, and other differentiators—your value—that aligns with their objectives. You provide the knowledge, expertise, and technologies that will reduce customers' costs, increase revenues, accelerate cash flow, and improve profitability. What you offer includes products and services, quality, competitive pricing, information, outstanding service, ongoing R&D, expertise, guarantees, and much more. Frame these elements in terms of their financial impact on your customer and you'll be perceived as a value-added partner.
5. Plan Vanilla Won’t Do
Customers are demanding more expertise and customization from every supplier. Just to play the game, suppliers must demonstrate thorough knowledge of the customer's industry. And customers expect even more from partner suppliers. Unless your company can provide customers with precisely the tailored services or products they desire, you'll have a tough time competing. Plain vanilla just won't do.
Implications for the Way You Sell: Make sure your sales team looks at the customer's business from the customer's point of view. In order to become a partner—and provide customer-tailored solutions—you must understand the impact that industry financial cycles and trends have on the customer's market share, sales, and revenue. Your sales team needs basic training in the economics of business and marketing, and ongoing training in the specific issues affecting the industries in their territory. Try having them spend a day each quarter in their customers' shoes. Touring plants, staffing sales desks, and riding in delivery vans is a great way to build expertise and demonstrate commitment to the customer.
6. Product Proliferation, Product Knowledge Deficits
More competitors are producing more product. Your company is responding in kind. As the product list grows, the sales team drowns in a sea of feature and benefit manuals. Customers perceive the classic service quality gap—everyone knows a little, but no one can give them a complete answer on anything. Internally, new reps take too long to get up to speed on all the products. And the time out of territory required for existing reps to stay current is a gaping productivity hole.
Implications for the Way You Sell: Apply cutting-edge learning technologies to develop your sales team's fluent product and service application recall. Delivering product knowledge efficiently and effectively will have a greater impact on customer retention than all your sales promotions put together. Proactive product knowledge training—that includes products, services, and the evolving technology that delivers them to customers--is one of the most critical areas in sales training today. As a measure of your team's recall ability, practice "elevator exercises"—two-minute practice drills where sales people respond in the moment with cogent answers and compelling answers to customer inquiries.
Issues from Inside the Company
7. Forecast Accuracy Blues
At best, just-in-time inventory means lower inventory costs. At worst, it means you need inventory when your customer needs it, and it may not be there. This is a vital pressure point that increases the need for accurate forecasting. Do your reps ask the right questions to qualify deals and their probability of closure? Remember, you can't sell off an empty wagon.
Implications for the Way You Sell: Once again, the key is being at the planning table with your customer. That's the only way to ensure accurate forecasting. As your internal supply lines respond to pressure to reduce inventory, your sales team needs to become more certain about their customers' business cycles and supply requirements. Many factors will affect the timing of customers' needs for your products and services. Train your sales team to become disciplined and rigorous about the probabilities of sales occurring based on the key factors that affect sales cycles. The ability of your production and manufacturing group to serve your customers' needs is directly proportional to the accuracy of your forecasts.
8. Sales Costs Up--Productivity Down
The cost of fielding a direct sales force is mounting by the day as travel costs, benefits costs, and customer demands for service are all increasing. But the average revenue per sales rep in many organizations is flat or declining. That puts sales cost and productivity on a collision course which can have a profound effect on profitability.
Implications for the Way You Sell: Recognize that you need to spend money to make money, yet streamline, re-engineer, and pinch pennies wherever you can. The day of the $200 dinner is gone. Consider making sales people responsible for profit by making them Òpresident" of their own territories--you'll be surprised how innovative they become. Reward the team for margin contribution, not revenue.
9. The Downside of Downsizing
Downsizing can mean an improved bottom line for your company. But to you, it often means the downside of an enlarged span of control—more administration and less coaching. Have your sales managers become highly paid sales administrators, spending more time on personnel issues than winning the big deals? Do managers who are required to carry accounts spend more time with paperwork than with customers? And are any sales managers spending 50% of their time in the field coaching reps and developing new business?
Implications for the Way You Sell: The job of sales manager is overloaded in the best of times, and downsizing just intensifies the pressure. Be sure your management team has the resources, training, and technology to free them from the administrative grind. Sales managers' real job is management--recruiting, sales planning, coaching, and developing a high-performing sales team. You cannot over-invest in sales management—it is the one true leverage point in your organization.
10. Margins Under Pressure
We've saved the best for last. All of the above are important reasons you must plan ahead to overcome sales barriers. Yet continuing pressure on your company's margins is even more important. Most companies have already trimmed costs to the bone, so the only way out of the profitability dilemma is to increase margins. That means increase price. And who will bear the burden? The sales person who has to justify higher prices to customers.
Implications for the Way You Sell: To improve profitability, focus relentlessly on margin. Do your sales people know the effect of a 1% price increase on your company's bottom line? Have they been trained to sell value and negotiate the best possible margin? Everything you do to support and motivate the sales team's success—from training for professional development to structuring their compensation--should be based on building margin over volume, profit over revenue. The rules of the game have changed. Play margin over volume if you expect to win.
Take the Initiative
These ten ways to improve the way you approach today's sales barriers are tenfold opportunities to differentiate your sales force from the competition, enrich customer relationships, increase market share, and exceed profit goals. Such proactive, strategic initiatives may seem daunting, but that's part of the game, too. Partners like Advantage Performance can help you design the sales management, training, coaching and other sales performance support initiatives that will help you meet the challenges that these sales barriers continue to present. So start thinking strategically today. Take the initiative and change—before these top 10 sales barriers become the top 50!
Advantage Performance represents a comprehensive portfolio of sales solutions from the world's leading sales performance support companies. For measurable sales improvement, contact Advantage today by calling 1.800.494.6646.
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