Boosting Margin with Sales Tools
Even with the most advanced sales programs available, it’s expensive to sell stuff. You must pony up bucks in advance to get bucks from the proceeds of a product sale. It doesn’t matter if you are a hobbyist selling hand-tooled belt buckles on eBay or if you are a multinational corporation moving million-dollar earthmoving machines, the cost of selling is significant. Sales tools can make an impact on success.
I’m not talking about supply or production cost, I’m talking about paying for the process of selling things—the cost of the person, their phone, their software, their travel, their lunches and most of all, their time. How much time does it take to sell a widget?
And then there are the mistakes. How much do those cost? The lowball price quotes, the invalid assumptions regarding the needs of the customer or capabilities of the product. How much time and money is wasted in addressing low-percentage opportunities that should never have been classified as qualified sales in the first place?
Cost control is an important part of almost any successful business strategy. Virtually any selling organization aspires to growth—growth in market share, in revenue and above all, in profitability. Cost control offers quick payback and impact on the bottom line.
Consider that a 1% reduction on the expense line shows up as a 4% increase in margin on the profit line.
Wipe out a few selling mistakes or shave off several days in the selling cycle and you will be rewarded with a much prettier bottom line.
Sales Tools Are Efficiency Tools
Let’s look at several sales tools and see how they impact the profit margin for a given sale.
CPQ – CPQ is built expressly to remove the opportunity for errors on the part of the sales rep and buyer. Configure price quote brings the expert along for the sales call. Product engineering, pricing and other “expert required” subjects are baked into sales configurators and brought into the sales conversation through scripted interviewing associated with defining the customers’ needs and the product configuration that best meets those needs.
Once the configuration is defined, the pricing calculation is executed applying all relevant discounts and pricing models that apply to the customer involved, the quantities being quoted and any special or campaign-related pricing in force at the time.
These processes are prone to error without some assistance from CPQ.
Guided Selling – Reps get bored and on occasion go off on their own to sell improbable product combinations to unqualifiable leads. I knew a rep who again and again asked for lease quotations for a prospect whose credit was non-existent. The rep could not understand that the only reason the prospect was talking to him was that our competition wasn’t wasting their time talking to this deadbeat. There were endless online accounts about this fellow skipping out on assorted financial obligations.
Guided selling prevents this type of occurrence by qualifying out prospects that don’t make the cut financially or from a needs basis.
Time and effort on the part of your rep will be reserved for high-percentage engagements with highly qualified prospects.
CRM – CRM is well suited as a sales tool for supporting guided selling and helping sales reps channel their efforts on the most qualified opportunities.
This can be accomplished on a large campaign level for your entire sales force or at the individual account-rep level. The rep can organize their week by calling on accounts with similar needs in close physical proximity to each other or accounts of similar size.
Whatever the selection criteria are, the rep can prevent unnecessary trips to fruitless appointments with prospects far removed from your success profile. CRM identifies list members based on the requirements you enter.
Reduce the cost of selling with technology. Increase your bottom line with technology, and sales tools.
Sales reps aren’t “coin operated” as so many folks like to say, but selling does require an investment. Invest wisely, grow your profits.