Sales Success is in direct proportion to your ability to initiate new contacts.
Because selling is a numbers game, based on the law of averages, the more new contacts you initiate, the more successful you are going to be, holding constant for all other factors.
The Three Step Sales Formula
There is a simple formula for outstanding sales performance. It consists of three activities: prospect, present, and follow up. Successful sales people are those who prospect, present, and follow up more often than unsuccessful sales people.
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A person of average talents and abilities who prospects, presents, and follows up all day long will run circles around a genius who does not. If a salesperson is not making the sales he would like to make, or is not earning the income he would like to earn, it can always be traced back to a failure in one of the three key result areas: prospecting, presenting, or following up.
Apply the 80/20 rule to all of your selling activities. In selling, this means that you spend 80 % of your time prospecting until you have so much business that you don’t have time to prospect anymore. You spend the other 20% of your time on everything else, including planning, organizing, paperwork, studying your sales material, socializing and any other activity that is not prospecting.
Prospecting is defined as the work of taking specific actions to seek out and contact people who need, who can use, and who can afford to purchase your product or service. The only thing that you have to sell as a salesperson is your time, and your time is only worth anything when you are face to face with someone who can buy what you are selling.
Begin With Clear Income and Sales Goals
Achieving peak performance and excellent time management in sales begins with your setting clear income and sales goals for yourself. The act of sitting down and deciding in writing how much you want to earn and how you are going to go about earning it makes it far more likely that you will achieve those goals then if you didn’t set them at all. The goal setting exercise I am 306
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about to share with you has led to the doubling and tripling of the incomes of many sales people. It is powerful because it is simple and easy. You can learn it and apply it immediately.
At a sales seminar recently, a woman came up to me and told me what had happened to her since she attended my seminar fifteen months before.
She said that she was just starting in real estate when she came to my sales seminar. She had not sold her first house or taken her first listing.
Nonetheless, as a result of this exercise, she set a goal for herself to earn $50,000 dollars income in her first year. At the time, she had no idea how few people selling residential real estate earned $50,000 per year. But the goal setting worked for her. She passed the $50,000 mark in her tenth month of selling.
She brought several of her friends from her company just to hear me explain the way to set sales and income goals that I am about to give to you.
Start With Your Best Year
You begin by taking your very best year’s income to date, and grossing it up by 50%. In other words, if your very best income year to date was $40,000, you set your income goal for the next twelve months at $60,000, or 50%
more. If your very best income year to date was $100,000, you set your income goal at $150,000. For the sake of this example, I will use $60,000 as the income target for the year.
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Once you have determined how much you want to earn over the next twelve months ($60,000), the next step is to determine how much of your product or service you are going to have to sell in order to earn that amount.
For example, if you are receiving a commission of 6% on your sales, you will have to sell $1,000,000.00 of your product or service over the next twelve months in order to earn $60,000.00. That number of $1,000,000.00
now becomes your annual sales goal.
Next, you determine your monthly income goal. In our example, $60,000.00
divided by twelve months equals $5,000.00 per month. You then determine how much you will have to sell each month to achieve that income goal. One million dollars in sales divided by twelve months equals $83,333.00. This becomes your monthly sales target.
Once you have determined how much you want to earn, and how much you will have to sell each month to achieve it, you then determine your weekly income and sales goals. Let us assume that you will take two weeks off on vacation. You then divide the remaining number of weeks, 50, into your income goal for the year. Fifty into sixty thousand equals $1,250.00 per week in this example.
You then calculate the amount that you will have to sell each week by dividing your annual sales goal by fifty. In this case one million dollars in sales divided by fifty weeks would mean that you would have to sell twenty thousand dollars of your product or services each week in order to earn $60,000.00 by the end of the twelve-month period.
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You now divide the number of days per week that you work into your weekly income goal. If you work five days per week, you can use that figure. In our example, $1,250.00 per week, divided by five, would equal $250.00 per day.
To calculate your daily sales goal, you divide the amount that you intend to sell per week by the number of days that you work. In this case, using $20,000.00 per week as the sales goal, and dividing it by five, you would arrive at $4000 worth of your product or service that you will have to sell each day.
Finally, divide your daily rate, in this case $250.00, by the number of hours you intend to work each day.
For example, if you work eight hours per day and you divide that into our example of $250.00, you would come up with an hourly rate of $31.25.
Focus on Your Hourly Rate
Once you have determined your desired hourly rate, you are ready to start work. From the time you start working in the morning until the time you finish in the evening, you refuse to do anything that does not pay you $31.25
per hour. And the only type of work that pays you $31.25 per hour, or more, is prospecting, presenting and following up.
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This is an important point that many sales people don’t seem to understand.
You cannot drop off your laundry, pick up your groceries, get your car washed or chat with your co-workers during the weekday and expect to earn $60,000.00 per year. Those time consuming, time wasting activities do not pay $31.25 per hour.
This is a universal law. You only get out what you put in. Because of this law of sowing and reaping, if you do $31.25 work per hour, eight hours per day, 250 days per year, there is nothing that will stop you from earning $60,000.00 or more over the next twelve months.
If you do $60.00 per hour work, you will earn more than $120,000.00 over the next twelve months. You determine your own income by the way you use every hour of each day. And the very best use of time is to invest it in prospecting, presenting and following up.
Determine What You Will Have to Do
Once you have broken your income and sales goals down into monthly, weekly, daily and hourly amounts, you then define these goals in terms of the activities necessary to achieve them. The critical element in this calculation is the factor of control.
You cannot control your income or your sales on a day-to-day basis. They depend on too many other factors. But you can control your activities. You can determine and control what you do from morning to night, and as a result, you can indirectly control your income. If you engage in the activities 310
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necessary to make the sales you want to make, you will inevitably achieve your sales goals.
It is important to emphasis that success in sales is a numbers game. It is a matter of probabilities. The more clearly that you plan out your sales strategies and tactics on paper, the more likely it is that you will do the things necessary to achieve the amount of money that you want. The sales will take care of themselves.
Plan Out Your Sales Work in Detail
Start by determining the average size of a sale, and the average commission that you earn per sale. Divide these amounts into your desired sales and income goals. For example, if you earn $500.00 per sale, and your annual income goal is $60,000.00, you will have to make one hundred and twenty sales per year, or an average of ten sales per month.