Smart Women SELL MORE
and Work Less:

A Strategic Approach To Sales

BY ELLEN BRISTOL

usiness is changing. Manufacturing, distribution, communications, hiring practices, and information technology have been transformed over the past 20 years. Yet, we still believe that it takes $1 million in the pipeline to close $100,000 worth of business - and that means a 90 percent failure rate. The sales force works awfully hard to produce nine losses out of 10 tries. You would not tolerate those rates in manufacturing, or in your receptionist's ability to take a phone message, so why is it OK for sales?

Cari Brito, the controller at Tropics North, a commercial landscaping firm in Princeton, FL, worried for years about the "selling failure rate" in her company. The sales force spent an enormous amount of time and energy on selling activity, producing forecasts that rarely came true. She hated the uncertainty, and worried about the costs of all that activity. But today, after a year of effort to change the picture, Cari Brito can sleep at night. Selling at Tropics North has become predictable, consistent and profitable.

What made the difference? The company created a strategic selling process based upon the Ideal Customer Profile. The company converted its sales department into the strategic function it should have been in the first place.

Previously Tropics North, like many other companies, relied on the conventional wisdom of the 10-to-1 ratio, that time-tattered "factoid" that says 10-to-1 prospecting is a fact of life: 10 phone calls to get an appointment, 10 appointments to get somebody to ask for a proposal, and 10 proposals to get an order.

Their old forecasting methods were based on optimism, best guess, and CYA. This made forward planning and purchasing a hit-or-miss proposition, which is a financial nightmare for any business owner. In fact, account executive Jane Gregson never knew if she was productive; she only knew how exhausted she was at the end of the week.

Their old forecasting methods were based on optimism, best guess, and CYA. This made forward planning and purchasing a hit-or-miss proposition, which is a financial nightmare for any business owner. In fact, account executive Jane Gregson never knew if she was productive; she only knew how exhausted she was at the end of the week.

You can overhaul the sales process in your company and enjoy similar improvements. Whether you manage a dedicated sales force, or do all the selling yourself, there are three things you can do to improve performance:

1. Understand the costs associated with pursuing the wrong opportunities;
2. Define the profile of "the ideal customer," identifying the desirable characteristics of buyer behavior that predict successful customer relationships; and
3. Walk away from the DOAs - the accounts that are "dead on arrival" and should never have been started in the first place.

The Costs: Return on Investment
Everything in business comes with a cost, and most costs are, or should be, investments that produce a measurable return. It's easy to overlook the "investment cost" of selling, which is difficult to determine, but absolutely essential that you recognize it. A good approach is to exaggerate it.

Assume that it costs $750 per hour to win a sale. That includes the cost of your time with the customer at her site or yours, finding and managing support resources, working on the proposal, carting the prospect off to see a demo, visiting with the prospect's technical staff, escorting the prospect to a trade show, and the extra costs associated with missed appointments, broken printers, and so forth.

Don't forget out-of-pocket expenses like gas, tolls, meals, collateral materials, courier services, and the cost of opportunities you lost while chasing this one.

If you invested 100 hours at $750 per hour to win a $10,000 deal, you just reduced your revenue by $7,500. Was there that much profit to lose?

It costs a lot to sell, and once you spend those expensive hours, they don't come back again. It is essential to view the time you devote to sales as an investment. Selling time must produce a high rate of return. There is no time to waste on unprofitable, marginal opportunities or business that never comes to a close.

The Ideal Customer Profile
The best way to avoid marginal opportunities is to know which ones are worth pursuing. That means creating an Ideal Customer Profile, another selling idea that is easier to talk about than it is to do.

The Ideal Customer Profile describes the perfect, or idealized, customer, the one that your company is best suited to serve. The profile lists all the characteristics you would like to see, if you could pick and choose only the best possible customers.

Be bold. Don't forget statements like "they pay me on time," "they pay me what I ask," "they're willing to pay me a premium because I've got something special to offer," and "they laugh at my jokes."

Include as many specifics as possible. Make sure that you include "softer" characteristics, as well as the hard facts. Customers who are cooperative, flexible, have realistic expectations, and so forth, are far more valuable than those who make impossible demands.

Once you have written down the characteristics of the ideal buyer, list the things you and your company do particularly well. The Ideal Customer is not ideal if she or he wants you to do things you can't do at all, or don't do well.

When listing your strengths, be honest, especially about the size and scope of the projects or transactions you can manage. The worst thing you can do is to over-promise and under-deliver. Compare your strengths with the desirable characteristics of the buyer, and see where the alignment lies. Pursue the prospects who want the strengths you offer, not those who call on your weaknesses.

In defining their Ideal Customer Profile, Tropics North realized that they do a great job with big projects (those $250,000 and up), so they listed that as a company strength. Small jobs are unprofitable for them. On their Ideal Customer Profile, they listed "offers projects worth over $250,000" as one of the high-priority characteristics. When they compared the two lists, the alignment was obvious. This observation was a breakthrough: Go after the big deals and forget the little ones!

Walk away from DOAs
It doesn't do any good to know your ideal customer if you don't use it to rule out marginal opportunities. Unfortunately, this is harder than it looks. The Tropics North experience was typical.

Even after their breakthrough experience, the Tropics North reps continued to pursue deals as small as $15,000. They were afraid to walk away from the prospects, since they had already put in some effort with those accounts.

Unfortunately, these unprofitable deals occupied so much selling time that the reps missed out on several sizable, and winnable, projects. Fortunately, they kept good data about deals pursued, lost and won.

After reviewing the information, the CEO decreed that any deal smaller than $100,000 needed his personal approval in order to receive further attention. Suddenly, those small deals disappeared from the radar screen, freeing up valuable time to pursue better business.

Use the Ideal Customer Profile as a benchmark. Ask revealing questions early in the relationship, to learn if, or how closely, the prospect matches the profile. Instead of trying to prove that you are "right" for the prospect, ask yourself, "Is this prospect right for me?"

There is no harm in telling the prospect, "We are not the right provider for you," or even, "Our fees are too high for your budget." This respectful position can work in your favor, creating friendly allies who may refer you to more appropriate prospects, or call you back in the future when their business needs are a better match for your business.

Smart Women Work Less - and Earn More
The secret to great selling and great success as a woman business owner is that less is more. Less confusion creates more clarity. Less activity produces more results. Less indiscriminate effort produces more targeted effort.

Selling is the most strategic business function there is, and it ought to receive the thoughtful, purposeful attention you give to the other aspects of your business. Set aside the time to analyze the cost of selling and your company's Ideal Customer Profile, and become more effective at acquiring clients and developing business.

Jane Gregson, senior account executive at Tropics North, sums it up this way: "These days, I pay attention to two things: whether I'm improving my 'close' ratio, and whether I'm walking away from opportunities that don't match our selection criteria.

Jane Gregson, senior account executive at Tropics North, sums it up this way: "These days, I pay attention to two things: whether I'm improving my 'close' ratio, and whether I'm walking away from opportunities that don't match our selection criteria.

ELLEN BRISTOL is founder and president of Bristol Strategy Group (www.bristolstrategygroup.com), a Miami-based company providing sales-force effectiveness programs and strategic planning services. She is a course author and serves on the faculty of the American Management Association. She can be contacted at 305-576-6236 (e-mail: ellen@bristolstrategygroup.com).