When it comes to building a strategy, where’s the best place to start? With a forecast of challenging times ahead of us, how can we rework an existing sales plan to best fit a situation that appears problematic and take advantage of it?
There is no better time than the start of a new year to revise your sales strategy, so, how do you get started when it comes down to it, when we’re greeted with the potential pressure of an economic crisis?
As our founder and CEO, Paul O’Donohue says,
“Never waste a good recession – there are always opportunities.”
A recession is often seen as a negative state so what do you see the opportunity to be when it comes to a financial crisis?
Removing yourself from the doom and gloom of it all, If you look at it with a different outlook, the opportunity is to grab more of the market when others aren’t doing particularly well.
While others may be struggling in their fields, the key is to get really good at what you do.
Considering the scientific and logical factors behind your sales, what is a realistic expectation on the revenue over the 12 months, 24 months and 36 months?
Let’s analyse the situation.
When you look over the next 12 months, it’s strategic, but also seen as equally operational. If you look over the next 36 months however, it can get highly strategic. Why? Because when you’re looking at a strategy over a longer period of time, it’s all about looking ahead at a future position.
For example, say your business is doing 10 million in the first year. Then, in the second year, you’re hoping to achieve 12 million and in 36 months, you hope to achieve 15 million. Look ahead at your long term goal in regards to the position you want to be in. Next is the tricky part – the how. How do we achieve this goal and where is the money going to come from?
As a starting point, take a look at the first year. Go further and review what the previous year looked like, too, determining where the revenue came from. How much of your revenue came from existing business that you can depend on? How much churn was there, ie. lost sales or customers? Additionally, you should factor in if there are any new products or categories the business will be adding and climbing into this year. These are factors that you can rely on reviewing each year that will help improve your revenue for the next.
From here, make a projection on how much new business you can rely on over the upcoming year. As you did previously, factor in a churn factor, here, too. So, if you lost 10% of your business last year, include a 10% churn this year too, as it impacts your revenue.
Additionally, have a business growth factor.
Research shows that it takes 5x as much to gain a new customer as it does to grow an active happy one. While seeking business from new clients sounds like the best approach, what eludes a lot of people is the blinding flash of the obvious: there is plenty of opportunity from your existing clients. This is what we would call Share Of Wallet (SOW), also known as farming or growing existing accounts.
Why would you be able to grow with existing clients just as much as you would with new clients? It’s simple. When you have clients existing in your database, you already have a relationship with them. They know you and your product, there is only the matter of understanding what else they are buying that you don’t already sell them. From here, the goal is to drive new sales and discoveries with those who are already invested in your business to get them across the line in a new category or product.
So, what is your existing Share Of Wallet with your existing clients and what is the potential? Do you think you would be able to use this as a good place to start on your business strategy?
When one of our clients was asked this question, their management estimated they could grow their sales by 50 percent just by selling their core products to existing customers. This was worth millions of dollars without even selling the secondary products and peripherals. As a result of this realisation, they embarked upon a Share Of Wallet campaign.
In tough times, your number one strategy should be not only retention of your accounts, but growth of your accounts. If you can retain your accounts, you’ll likely get through the challenges that lie ahead without even considering new business.
If you can grow these accounts, you’ve now got retention and growth without the help of any new customers and that’s the easiest place to start.