Close more deals.
That’s the goal of most sales people, sales managers and sales driven organizations.
But what if it’s the wrong goal? What if setting a minimum sales quota was hurting your success?
What if there was another number that was much more important, and more profitable, than total sales? There is, and it’s so simple that once you know it, you can quickly increase your sales by 33%, and your profits by much more.
The Problem With Minimum Sales Quotas
If you want to improve your number of closed sales, setting a minimum quota probably isn’t the best way to do it. That’s what nearly every sales organization is doing, and following the crowd is a quick way to become average.
Minimum sales quotas create two problems.
First, they create the fear of not hitting the quota. This fear spills over into all sales activities and often comes out in conversations with prospects. It makes your sales staff, especially the inexperienced ones, sound desperate.
Second, they encourage laziness for your sales reps who can hit minimum quota with minimum effort. Once they get enough sales, they usually relax until the next week or the next month starts. So what’s the solution?
The Magic Number of Sales Success
The magic number of sales success isn’t total closed sales, it’s total confirmed rejections. All of the great sales trainers, including Tom Hopkins, Zig Ziglar etc., talk about something called “The Law of Averages.”
According to the LOA, 100 contacts usually lead to 10 presentations and ten presentations leads to one close. This means that if your sales quota is 5 sales per month, you can pretty much count on meeting it if you make 100 calls a month.
But this only encourages average performance. If one of your reps has a “winning streak,” and meets their quota quickly, they have no more motivation to push to the next level. They settle into average performance.
The average sales person only asks for the sale one time during a presentation. This means, out of those 10 presentations, they only heard no nine times, tops. What if, instead, you were to create a goal for them to make 125 calls a month, to make 12 presentations and hear at least four rejections during each of the 12 presentations?
Not only would they close more sales, they wouldn’t stop and lose momentum after meeting their quota. They’d keep going to get their confirmed rejections. Most important, they’d desensitize themselves to hearing “no” and they’d become bulletproof to fear of rejection.
Try this for the next 90 days.