What to do when sales is seriously under budget ?
When sales revenue is seriously under budget, the company management can blame it on many factors:
- Economic: recession
- Competitors: slashing prices
- Salesmen: not performing – not achieving
- Marketing: the wrong campaigns, the wrong events
- Management: this is the most unlikely to do
in order to explain to the Board of Directors.
Still in most cases the Board of Directors will require a fast fix.
The real question is question: how to solve the problem?
Salesmen related
- Fire a few salesmen
This will give shock to the other salesmen, but will it motivate ?
- Hire more salesmen
Could work but that will be costly and the geographies or product lines need to be reorganized – costing time
- Replace a few salesmen
Firing salesmen and hiring new ones will take time.
Some leads and prospects will be lost.
It takes at least 6 months for a newbie to know how to sell in this B2B.
- Demand to increase the cold calling
If your sales cycle is short: it might help. If the sales cycle is long: no cure.
If your customers are hard to influence, this will be not a solution.
The valuable time of salesmen is wasted by waiting on the telephone and dialing.
- Call on existing customers
As these companies have previously decided to buy from you it is likely there will be additional sales.
- Up-sell or cross-sell with your existing customers
If you don’t try you will never know.
If your salesmen didn’t bother previously, then this could generate marginally more sales.
- Shorten sales cycle
Sales cycle can be shortened by more calls and more meetings, but are your customers deciding more quickly ?
- Higher commissions
Salesmen will make more efforts and spend more time on selling.
Marketing actions
- Start several email campaigns
Could help, but will not change revenue overnight as email campaigns are marketing tools to generate leads.
- Telemarketing
This is a marketing effort that can generate leads.
- Setup an event for customers, leads, prospects and partners
Might work but depends again on your sales cycle length.
- Look on your website for more leads
Use a web service that reveals the company name of the website visitors and their interest: generating more leads
Management decisions
- Give additional discounts
This will bring in additional sales as there are always people and companies looking for bargains.
Still you need to close more deals than before due to the discount.
- Higher quantity discounts
Works for a short time span, as your customers stock up on products they will buy less next quarter.
- Increase your prices
Then you need to close the same number of deals in order to increase revenue.
You have to close the same number of deals.
And hope your customers aren’t switching to your competitors.
- The carrot
Give away an additional service or item for free from a certain level of order value.
- Promote a sleepy product sitting in your inventory at rock bottom prices
As the products have been paid, keeping them in your inventory will only cost you more interest
- Partnerships
Signing a few promising partnerships has potential but will consume time before any result.
- Bundle your products with partner products
This sure will generate interest as you address the market differently.
However his will require a marketing campaign. Thus not an immediate solution.
- Online sales: setting-up an online shop in the hope to sell direct
Selling online can be direct and fast.
It takes probably much longer before your online shop is findable on Google, Bing or Yahoo! than you average sales cycle.
Your distributors and resellers will get upset and refuse to sell your products.
Financial possibility
- Prepayment or payment on delivery
Instead of needing to wait 60 to 120 days for your payment, ask for immediate payment.
This will not increase your revenue, but sure will help your cash flow. The question is what will you give in return ?
More services ? Less maintenance fees ?
What do you do to reach the budget if you are lagging significantly behind ?
Or you don’t care as it is only a budget.
