In selling kitchens and baths, it’s critical to set a concrete sales goal and then take the steps necessary to ensure you achieve said goal.
You might be a sales manager leading a staff of salespeople. You might be that salesperson who reports to a sales manager. You might be an independent designer who reports to a spouse. Regardless, you must take the initiative and responsibility to set an obtainable and realistic sales goal, and to do everything in your power to hit or exceed it.
A Measure of Performance
Consider the sales goal a measure of professional growth. It allows us to compare how much we achieve from year to year, and how we learn from our shortcomings and mistakes.
The sales goal might cover the full calendar year, mirror the company’s fiscal year or be set month by month. But, whenever this event falls in the calendar, it’s important to reflect on your performance from years past as well as reflect on the future.
Some salespeople welcome this opportunity to set an attainable goal. Others find it stressful. Here are some thoughts on setting up a goal that is comfortable (but still challenging) and obtainable.
- Get Ready. Get Set….For the independent designer or sales manager, start by determining your (or your salesperson’s) sales goal in terms of margin or profit of your (their) total net sales. Use your (their) past or projected gross profit percentage and work backwards toward the total revenue number that will become the sales goal. For example: if the salesperson is looking to generate $50,000 in profit at an average gross profit of 25%, his or her goal would be $200,000 in total net revenue.
Here’s where it becomes tricky. The sales goal is not only a revenue number but also a profitability margin number. Both of these numbers are equally important in the sales process and must be set and met to be successful.
As sellers; we have the tendency to rely on the total sales goal as the critical metric because it is much more concrete. But don’t forget about that ever so important profitability!
- Don’t feel overwhelmed. When you first determine (or are assigned) your sales or personal goal(s), it can feel like a gigantic number, especially since this year’s sales goal is usually much higher than last year’s goal. Do not become a victim of the stress. Think positively. See the goal as a figure that will be constantly moving down as you move through the year and execute your selling processes.
- On the contrary, if need be, go big. If you’re working for a company and the sales goal is set for you, there’s no reason why you have to be satisfied selling at the revenue level the company needs. If that number in your mind is larger, then you need to just go for it. Go big! Find the revenue number that will allow you to reach your goals for the year and use that as your real quota. Just make sure it’s obtainable so you’re not setting yourself up for failure. It might seem tough at first, but it will motivate you that much more. And, just think how happy your sales manager (or spouse) will be!
- Identify what sales are imminent. Look at the work that you’re already doing. Being in the cabinet design and sales business, we are constantly working on projects that won’t see delivery for weeks or months ahead. Determine what is in your pipeline. Figure out what projects you know will definitely close and what jobs you have a strong feeling about that you believe will be closing soon.
Set up timelines for when these projects will close. Evaluate if you can tap farther into your existing client base. Can you provide them another set of products or services to expand your offerings to them? These are the easiest and most readily available sales opportunities.
If it is an individual homeowner you are working for, is there opportunity to expand the scope of work? Perhaps if you’re doing a kitchen project, you could sell a bath remodel or freshening up, or a face lift for the laundry area. If you’re working for a building company or contractor, find out if there are other projects that they’ll be working on in the near future. Some builders are happy to share the information with you when you ask. They may even be able to give you tentative project start dates. Keep notes on when their other projects are slated and stay in contact with them, following up periodically.
- Identify what sales are at risk. If you’re accustomed to working with a group of repeat business opportunities, you may see some of these struggling due to the economy, or even going out of business. No matter how great a salesperson you might be, you can’t control the fate of another business. So there’s always going to be attrition in your sales prospects.
Try to figure out which clients are most vulnerable. By talking to your existing clients carefully and respectfully, you can determine what they might have coming up or if their own or their company’s perspective is changing. But remember, for every door that closes there is one that can be opened. You just have to work to find the new opportunities.
For every existing client you feel you might lose, you should strive to replace it with two new accounts. New accounts are usually slower to develop and might only give you one project to see if you can perform prior to turning more work over to you. You could subtract a percentage of these sales from your goal, making a note to pay special attention to them along the year.
- Leave yourself some room. Now you should have a more manageable sales goal number. But, whatever is left, add 25% to it. If something doesn’t close, gets postponed or just plain disappears, you’ll still be able to achieve your sales goal.
- Manage your prospecting. So, you’ve subtracted what you have upcoming with existing customers, subtracted what are viable upcoming sales and the percentage of what you might lose. Now what? Now, you must look at what your closing ratio is. You can next determine how many leads you’ll need to generate throughout the course of the sales goal to meet or exceed your number.
You can break this down by week, month or quarter to keep track of where you need to be. Knowing how many prospects you need in each given time period will help you outline how best to market to these prospects.
Lastly, be realistic and conservative in your estimates. Once you figure out what you need to do to meet your sales goal for the year, you’ll never have to feel the pressure. Since you will be actively managing the goal throughout the course of the sales year, you shouldn’t have any problem blowing that figure out of the water!