This article looks at first-meeting-to-proposal and proposal-to-order ratios.
Following from the article "Finding And Fixing Sales Performance Problems - Defining The Problem" on finding and fixing the problem in performance, this article develops the subject and addresses two elements of sales effectiveness:
Most sales operations would agree, providing your sales people are getting in front of enough qualified prospects (and it seems that less than 14 per cent of salespeople do this, based on our diagnosis), it is their skill in getting from first meeting, to an order, that has the largest effect on revenue.
How do we increase our first-meeting-to-proposal ratio?
Sufficiently and thoroughly qualify your client. This alone will improve many company's performance. Many customers say to us, 'It is straightforward to get the customer to see a proposal'. However, there is a fundamental difference between agreeing to do a proposal, and the customer who says, 'I am genuinely interested, can you develop a proposal that covers the following?'.
In our world, we talk about the difference between advance and continuation:
- Continuation is simply finding ways to carry on a dialogue, irrespective of the customers desire to buy.
- Advance is getting genuine commitment from the customer to the next stage of the sale.
As such, a proposal should be given purposefully under certain conditions - not just because it might generate some interest. As with all attempts at improvement, there is a process and key activities to be completed at each stage.
First-meeting-to-proposal ratio is an expression of capability to identify critical needs. They need to:
- Set appointments with the right people.
- Take control of the meeting.
- Put forward a brief overview of your company's position in the market.
- Qualify the customer, in terms of budget and decision making.
- Turn broad statements of need in critical commercial imperatives.
- Define the process from here to order.
Sales effectiveness improvement model:
- Define your best practice model
- Develop tools to evaluate against the model
- Identify skills gaps
- Develop skills using practice/apply techniques
- Measure changes in practice and results
- Define your best practice model
Set down a sequence of observable behaviours. What will it look like if they get it right? Ask yourself this question: "From start to finish, what should the salesperson do to secure the business?"
- Develop tools to evaluate against the model
Once you have a clear view of what you want, you need to develop some form of observation tool that will allow you to assess your people versus best practice.
- Identify skills gaps
Observe your salespeople in action. Using the tool you have developed to assess their current capabilities, observe them on a pitch. Managers can often find it difficult to keep quiet and jump-in to help the sale.
- Develop skills using practice/apply techniques
Be sure that you follow an adequate development process once skills gaps have been agreed. You must coach, not tell, and you must have the skills that allow the person to practice new approaches.
- Measure changes in practice and results
You then observe over a period of not less than four months the person in the workplace to the point where they now follow the best practice model with sufficient skill.
How do we increase our proposal-to-order ratio?
The second area is that of improving the proposal-to-order ratio. The process model is exactly the same, only the best practice model for this stage of the sale looks different. People need to:
- Differentiate between a proposal and a quote.
- Develop proposals that sell.
- Have the ability to explain to the customer the features and benefits of your product/service and how it compares to your competitors.
- Close or manage the sale to a conclusion.
So again, you must define what it looks like, be able to measure whether it is happening to the standard required and develop the key capabilities needed. As part of a development process, it is wise to follow step three to five in a cyclical basis.
Read the article "Finding And Fixing Sales Performance Problems - Defining The Problem"
Read the article "Finding And Fixing Sales Performance Problems - The Performance Improvement Process"