No successful retailer would dream of doing business without sales goals. They serve as definitive marks you can aim toward in order to reach your desired profits. You can expect to achieve those numbers only when you and your sales staff set goals that are specific, realistic and measurable.
With their target in sight, your salespeople feel in control of their own financial destiny and are motivated to sell even more. Sales goals also provide a budgeting structure and set performance standards and other goals for all your employees. Says Tim Connor, sales trainer and consultant, and president of Connor Resource Group in Davidson, N.C., "When people know what's expected of them and they attain their goals, they tend to be happier and less stressed, resulting in a happier store that attracts more traffic."
Working for a goal-setting company with robust revenues and room for raises benefits everyone at your pool and spa dealership. And your customers. Their needs, from the first greeting to final follow-up, are eagerly met by salespeople working hard to increase their commissions.
HOW TO SET SALES GOALS
To successfully hit the mark, begin by recognizing the three types of sales goals, as defined by Joe Milevsky, president of JRM Sales & Management, a retail consulting and training company in Kennesaw, Ga. Corporate goals reflect the financial level of performance that you, as owner, seek to achieve to consider your business successful. Sales staff goals drive all your employees toward the total gross sales that will help you reach your corporate goals. Personal goals, whether that's your desire to open a second location or one of your sales employees saving for an engagement ring, help determine the level of corporate and sales staff goals.
With these general goals in mind, aim accurately by following these five steps:
1. Study your company's history.
Look at your quarterly and monthly figures over the past five years and compare them to each other. Identify trends and anomalies, and what may have contributed to these, so you can apply this knowledge to future goals.
2. Decide what you want.
Write down your personal and corporate goals, and encourage staff to do the same for theirs. Says Connor, "This crystallizes your thinking and gives you something concrete you can look at and evaluate."
3. Break down your goals.
Divide your annual corporate goal by the month, basing each on historical percentages within the last five years. Apply those same percentages to individual sales goals, breaking down the monthly figure by the day, based on the number of days the person works in a given month.
4. Establish a timeline.
Give yourself a date to begin working toward your goals and another date when you want to see them accomplished. Imposing deadlines on yourself and others keeps you motivated to achieve your goals.
5. Monitor your progress.
Keep daily records that track the number of customers who came in, number of sales, dollar amounts of sales, etc., so you can evaluate how well you're doing and where you need to make changes to your goals.
KNOW HOW HIGH
Everyone's goals are different. You will know where to set them when you:
- Know your budget. "To set a corporate sales goal, produce a budget with your desired bottom line in mind," says Milevsky." Forecast annual revenues, cost of goods and expenses. If your expenses are in line and your gross margin is maximized but the bottom line is not acceptable to you, then you'll need to raise your sales goal accordingly."
- Determine sales standards. "The combined goals of all your salespeople should be 10 to 15 percent higher than your corporate goal, or you won't consistently achieve that goal. Expect most of your salespeople to perform at 75 to 80 percent of your top sales associate," says Milevsky.
- Make goals reasonable. Don't set your goals too high or too low — you'll either feel discouraged or bored. Shoot for somewhere in between, at just beyond your comfort zone. Says Connor, "People with reasonably high expectations tend to rise to the level of those expectations."
WHAT IT TAKES
Setting successful sales goals requires these 10 things:
- Compatible goals. Tie sales staff's personal goals to professional goals — ones they set themselves — so they feel invested in them. Make sure they relate these to your corporate goals.
- Imagination. Goals based on a personal vision are fueled by the imagination that fires them into action. Clearly visualize yourself reaching your goals, and then galvanize your efforts with positive, present-tense self-talk and written affirmations.
- Positive work environment. This includes open communication between you and your sales staff, ample coaching, sales-goal training, staff meetings and a team spirit that involves the entire staff working together toward a common goal.
- Motivation and commitment. The drive to succeed demands desire and determination. While you can't teach these, you can encourage them with corporate-level support, appropriately set goals, and incentives and rewards.
- Incentives. Along with sales commission, give spiffs and hold contests and games for your salespeople. These create fun and excitement, and encourage them to work even harder to achieve their goals.
- Positive reinforcement. "Catch your staff doing things right," as Connor puts it. Acknowledge their successes with cash bonuses, dinners out or days off. Give public recognition with praise during staff meetings.
- Good organization. Successful sales-goal setters monitor their numbers and manage their time wisely. It helps when you run your dealership systematically and orderly.
- Independence and confidence. Do you and your sales staff possess self-direction and self-assurance. That's what it takes to maintain the resolve to reach goals, especially when the going gets rough.
- Flexibility. If you're poised for change, you can adjust your sales goals in response to uncontrollable obstacles and unexpected opportunities, such as a weak economy or large-volume customer.
- Perspective. When you can manage and respond to the smallest details while maintaining a focused view of the big picture, both within and outside of your business, you have the vantage point from which to better achieve your goals.
THE UNREACHABLE GOAL
You do your best to hire the most experienced, motivated and intelligent salespeople for your business. You provide training, coaching and plenty of one-on-one communication. And still, at some point there will be someone who is not reaching his or her sales goals. What now.
First, put the person on probation for a month or more, recommends Milevsky, and work closely with him or her. "Get out on the sales floor and observe the employee," he says. "Examine all aspects of the way they sell."
How does he approach the customer and get the person to open up? Is he a good listener? Is he able to develop a relationship of trust with the customer? Is he able to present your company's products in a way that's meaningful to the customer? Can the salesperson ask for the sale? How does he handle the customer's objections? What about customer follow-up? Spend at least an hour a week behind closed doors with the employee, giving feedback on selling behavior. Ask about barriers he faces and how you can help.
If, after this probationary period, the sales employee continues to evade your expectations and the goals you both set, Milevsky suggests a formal write-up consisting of the person's substandard sales results, problems met on the sales floor and a summary of coaching. You still want to help, not lose, the person.
For 30 more days, observe, monitor and coach the employee. If the person shows no progress, there are only two reasons why. "One is they can't do it; they simply don't have the ability," says Milevsky. "The other is they won't; they're not motivated enough. In either case, you have to let them go."
That doesn't necessarily mean firing the person. The last thing you want to do is terminate anyone. Take note of talents and strengths and consider where else in your business this employee could be happier and more successful. If he or she isn't cut out for sales, perhaps your marketing and advertising department, for example, would be a better fit.
IN THE END
You and everyone else at your business must determine your own, personal definitions of success, and the terms all of you require to achieve your goals. Just before or after you accomplish your goals, set new ones for yourself, so you always have something to work toward. Once you've reached your destination, don't forget to reward yourself. Then sit down with pen and paper and figure out exactly how you got there.
Says Connor, "Typically, people don't ask why they were successful, only why they weren't. It's just as important to understand the factors that contributed to your achievement. Look at your expectations and evaluate the results, so you can set the bar even higher."
You depend on the success of all of your employees, not just your sales staff. Gather up the might and motivation of everyone on board, have clear goals in sight, and face the target together. Then aim straight toward the bull's eye — and give a big boost to your business.
