From the course: Sales Channel Management
Sales, marketing, staffing costs: ROI
From the course: Sales Channel Management
Sales, marketing, staffing costs: ROI
- Sales people, by nature, are an optimistic group. Let's face it. At times, we encounter some pretty tough situations. Buyers who may not like our offerings, or after working so hard, sales that just don't materialize. If we don't find ways to overcome obstacles and remain positive, then we could be facing a long and painful career. Sometimes we're accused of being too optimistic; however, I always want to be known as the upbeat sales person and the one who remains positive and committed to close a sale. Optimistic sales people know the phrase run with your winners. This is when you have a product or service that's working well in the marketplace. Your developers in the corporate office have hit the mark with what people want and sales people run to offer it to their accounts. Sometimes though, we're reluctant to run fast enough away from things that aren't working. Evaluating your sales channel plan needs to be done regularly, rigorously, and realistically. The more complex a plan, the more you have to pay attention to the financial aspects of it. I don't care how optimistic you may be, the return on investment, ROI, is not going to be the same for each channel. This goes back to your initial work you did in surveying the marketplace and establishing financial goals and objectives in conjunction with your financial manager. At that time, you knew that some channels would perform better than others, and investment results would vary. In the research and planning stage of preparing the channel sales plan, you should have established a variety of key performance indicators. These are a series of metrics, business objectives, and targets that you've agreed to focus on with your sales management and financial teams. The core of these KPIs tie directly into revenue and expenses. You'll have an overall number for your sales organization, but it's important to break it down as much as you can by each channel. You'll have a series of sales targets, new customer acquisition goals, and the sales staff expenses linked to those channels. You then can add in associated marketing related costs and other business development expenses. This is a perfect use of a KPI dashboard that can provide a visual look with a real time view of your business. Some dashboards can be very simple with just the most critical tracking items, such as sales, forecasts, expenses, and sales by representative, for example, while others can give you a real detailed analysis of your business including more charts, graphs, and indicators. It all comes down to your preference and what can provide you with an honest and realistic view of the sales channels. Whether you track a variety of metrics and objectives or have very visual attractive KPI dashboards or not, at the end of the day, it comes down to, are you making money or not? The heart of the analysis is the ROI and your benchmark percentage. Sales divided by expenses equals X percent. This is where as managers we need to face the facts. We're optimistic by nature, but as our financial people will always tell us, the numbers don't lie. We can ask for more time, maybe spend some more marketing money, or put more pressure on our sales team and channel partners to build revenue; however, there comes a point when we must decide to move forward, pause, or stop working a certain channel. Markets change and channels evolve, so regular reviews of your staffing, expenses, and revenue is one of the most important parts of successful channel sales management.