My first sales job out of college was in Detroit selling office copier machines in an era when most offices didn’t have any copiers at all. This was back in the days of carbon paper and office secretarial typing pools.
Each day started bright and early in the office with a sales skills training session and probably a practice demonstration or two in front of the other salespeople in the office. As you can imagine, doing a presentation in front of a bunch of aggressive young sales peers always involved lots of teasing, hissing, and booing from the peanut gallery. Even so, in the end, I really learned how to give great demonstrations. These demonstration skills have served me well throughout my 44 years of tool sales.
As I reflect back on those early days of practicing and perfecting my pitch, I’m reminded that the ability to present a great demonstration was only part of the battle. The big and hardest part was getting in front of potential buyers to give a demonstration and close a sale. Like professionals today, everyone was always busy, and appointments were hard to come by.
In addition to learning the sales skills each day we had to make our prospecting numbers. These were mine:
· 40 - As in, mail 40 pieces of literature to companies in your geographic sales territory.
· 20 -Telephone 20 companies prospecting for appointments.
· 10 - Make 10 cold calls each day, also prospecting for appointments.
I was skeptical at first, but I soon came to find that the simple practice of doing my numbers every day would almost always produce the magic number of two physical demonstrations.
And with two demos a day, five days a week, those ten presentations would almost always produce at least one sale, even in the beginning when my demos weren’t too convincing. This would be a ten percent closing ratio per week. As time went on and experience bettered each pitch, I was able to continually improve my closing ratio and as they say, “The rest is history”.
So let’s dig into your numbers.
I’m guessing that you make around 15 stops per day and that you see around 45 technicians. Some days more, some days less, but for this example we will use these numbers.
And – oh, by the way – a promise to buy or an “I’ll buy that next week” is not a sale. Only a product changing hands or a firm order counts as a sale.
Fifteen stops. Do you sell something on every stop? Probably not. If you sell something to 20 of the 45 people you interact with that would be a 44 percent closing ratio. I’m guessing this would be a pretty good day?
Now let’s get deeper into this numbers topic and make your numbers pay off with additional revenue and profit.
Let’s first define a presentation. A presentation is a serious features, advantages, and benefits product demonstration/discussion to a prospect who has shown interest in buying. This presentation is planned and conducted with a demo, catalogs, and pricing. Simply asking a technician if they are interested in seeing what is new in tool storage is not a presentation.
You might be wise to analyze your presentations on three or four levels. You can change these levels as your see fit, but here are my recommendations:
1. Presentations for sales of $500 or less
2. Presentation for sales of $2,000 or less
3. Presentations for sales over $2,000
Now do your best to figure out your closing ratio for each presentation level.
Logic tells me that you are usually presenting something valued at $500 or less on just about every call, and something over $2,000 or more every other day or so. If you are selling something to 20 of your 45 daily contacts as mentioned above that is a 44 percent closing ratio, which is good.
Your closing results quickly become more financially important when you analyze your higher valued presentations.
If you are giving three high value presentations per week or 156 per year at only the $2,000 level, that adds up to a $312,000 annual potential. This potential is probably much higher since a nice tool storage order is $5,000+.
A successful closing ratio of 20 percent of one out of five presentations would produce (at $2,000 per sale) a revenue of $62,400. A minor 15 percent closing rate improvement to 23 percent would bring in sales of $71,760 or $9,360 more revenue. So what happens to your revenue and income if you set your goal and meet that goal of closing 33 percent of your major presentations? Just one deal per week. Even at just $2,000 per sale that is $102,960 in revenue and $40,560 over the previous 20 percent closing ratio.
“Sounds great,” you say. “All I have to do is close a higher percentage of my sales, right?” It’s that straightforward. So, what are the steps to take?
1. Come up with a baseline of how many high value presentations you gave last year. I know you don’t know exactly, but just give it a good guess.
2. Of those presentations you gave last year how many resulted in a high value sale? (Step 1 divided by step 2 will give you your closing ratio).
3. Develop a plan to realistically increase the number of high value presentations you want to give this year.
Remember – even if you are not a presentation star, the more times you get up to bat the more hits you will get just by showing up. Here are some ideas:
- A social media campaign publishing a picture of every customer who purchases a high-value order will get others interested, and continually show them you mean business.
- In addition to the usual monthly promo brochure, hand out brochures on higher value products on every call.
- Ask, ask, and ask again for the opportunity to present your products to a technician who needs what you are selling or has an old version that needs updating.
- Host a before-work “Donuts and demos” session to give an overall demo to all interested technicians. Follow this up by speaking to each attendee individually about their possible interest.
It’s important to truly and honestly analyze every presentation, good or bad. Ask yourself: What went well in your presentation? The opening? The demo? Objection handling? The close?
Then ask yourself what didn’t go so well. Be honest now. Did the prospect take you seriously? Did you hold their attention? Did you “trial close” to take their temperature as you went along? Did you answer their questions/objections and get their buy-in to your answers? Did you ask your closing questions logically and solidly? Did you take “no” for an answer too easily?
If you didn’t get the order today what is your plan to close it later and what approach will you use? Always think about what you can do to improve the things that didn’t go so well.
Closing lots of small sales keeps your business running, your attitude up, and puts food on the table. The high value sales put your kids through college and get you a new Harley or a super vacation.
Now go sell something.
