CEO Advisor Newsletter September 2017
CEOs that Focus on Growth Gain Big Profits
The two primary avenues for growth are a) Organic growth and b) Growth by acquisitions. Growth by acquisitions can enable you to accelerate growth, increase profits, gain valuable talent, expand product lines, enter new geographic markets, and increase the value of your business. Organic growth through additional sales from new and existing customers is the primary focus of most CEOs nationwide, and that is the topic of this article. CEO Advisor, Inc. provides business consulting for growth, as well as, growth capital and mergers and acquisitions advisory services to CEO and owners of small and mid-sized companies.
CEOs that put sales management at the top of their agendas outperform their competitors in revenue and profits by up to 80%. While CEOs and presidents of small and mid-size companies play a key role in driving performance improvements across all aspects of a company, sales has traditionally not been the main focus of business owners of many companies. This is a very costly mistake.
CEOs, presidents and business owners of top performing companies are hands-on in driving the business forward. Setting budgets and sales goals are just the beginning. The best CEOs pinpoint specific tools, analytics and key performance indicators (KPIs) to ensure substantial growth (at or above industry growth rates) in revenues, gross margins, and profits.
They also ensure that they have the right people in the right positions and that each sales team member is performing consistently and optimally. Growth oriented CEOs also ensure they have strong sales management in place and provide direction and the needed tools to ensure that sales management can optimally do their job.
Similar to marketing, sales is both an art and a science. Here are 5 key sales issues that will create a tremendous return on investment and grow your business to the next level. If sales and sales management are not your strengths, gain the help you need as failing in these important aspects of sales can cost you hundreds of thousands or millions of dollars over the coming year.
1. Build a Sales and Marketing Machine to Optimize Sales and Value of your Business.
By building a sales and marketing machine within your company, you will optimize your revenue and net profit and tremendously increase the value of your company. Making this a top priority is the greatest return on investment you can make. This takes some planning, focus and attention to details to put in place and manage, so gain the needed outside advisor to get this right. 2. Deep Dive on Sales Goals to Increase Results.
Well managed sales teams produce big results. CEOs must go beyond a weekly sales meeting and monthly sales goals for each member of the sales team. CEOs must develop Key Performance Indicators (KPIs) that produce heightened, consistent results to meet goals.
A direct sales team should have clearly defined goals for each salesperson that include, for example: a) Dials per day, b) Live contacts per day, c) Opportunities created in your customer relationship management (CRM) software per week and month, d) Sales appointments per week and month, e) Proposals presented per month, f) Closed sales per month, g) Closed sales in dollars per month, etc.
3. Key Performance Indicators (KPIs) to Drive Sales and Profits.
Additional goals that can be readily tracked monthly will be the difference in a proactive, results-oriented sales team vs. a sales team that is always behind the curve resulting in poor profits or losses. You should monitor and track: A) Average size of each sale (ensure you are selling to larger customers with larger budgets), B) Average length of contracts, C) Renewal rates of contracts, D) Track the amount of sales to your top 25 customers per quarter and year to ensure you are properly servicing them and hitting sales goals, E) Gross profit margins, F) Net profit margins, G) Industry growth rate, H) Your growth rate and total market share, I) Customer churn, J) Revenue churn.
4. Get Out of the Office and Visit Existing Customers.
As the CEO of your company, get out of your office and go with sales managers and individual salespeople and visit your major customers at least annually. Understand the customers' needs and satisfaction level, unde rstand how you can help them by up-selling and cross-selling additional products and services, renew annual contracts and secure a tighter relationship by demonstrating real interest and commitment to your customers.
5. Make Sales and Account Management (Servicing Existing Customers) the Life Blood of your Business.
Here are some key factors to increase sales, profits and the value of your business: A) Strong sales management should be part of the fabric of your company, B) Making top sales performers heroes at your business should be paramount to you, C) Training your sales team should be exciting and part of every week and every sales meeting, D) Designing the right sales compensation plan and retention of your best performing sales team members should be a top priority, E) Consistently hold sales meetings that are motivating, numbers driven and training-intensive should be a weekly occurrence like clock-work, F) Develop an Account Management Program that ensures customers are retained and well serviced, G) Implement the Account Management Program to provide best practices in retaining, servicing, upselling, cross-selling and educating customers on your value proposition.
Maximizing sales will be the difference in reaching your goals and a successful exit in the future versus strained cash flow and diminishing value of our business with no options for an exit.
Contact Mark Hartsell, MBA, President of CEO Advisor, Inc. today for a no cost, no obligation meeting at your office to discuss your growth issues at (949) 629-2520 or email MHartsell@CEOAdvisor.com.