Making time for revenue – moving from small to large opportunities
In our last post, we discovered that sales were not allocating their time to the highest revenue accounts. We now need to work out how to change this.
Focusing sales on revenue potential
There are many ways to allocate sales resource to customers. Many factors such as growth potential, resource intensity, margin and (that most missed used of sales concepts) strategic potential play a part. But in this post, we heroically assume that the highest revenue accounts deserve the most attention.
The key to allocating sales attention is to create an engagement program that matches cost with potential. In this example, the client selected to:
|Client revenue segment||Action|
|Zero||Discontinue activity. Consider responding if approached. Allow select pursuit of ‘strategic’ accounts, but keep pursuit status under review and contingent on results delivery|
|Up to $10K||Catch as catch can. Have internal sales respond (of course) to email and phone requests for product sales. But do not chase these clients for business as the cost to serve is likely as high as profit achieved. Do not proactively allocate sales resource to these accounts, but allow select ‘strategic’ account activity (as above).|
|$10-$100K||Move client to management by inside sales. Where-ever possible conduct engagement though email, with quarterly email follow up scheduled. Do not plan free onsite visits. Restrict sales visits to a minimum (anything more than annual is worth looking at). However, schedule minimum of quarterly inside sales contacts.|
|$100K-$1million||Keep this client managed primarily by inside sales scheduling a minimum of monthly calls. Schedule visits by sales at least twice a year with follow up agenda for action by inside sales.|
|Comment: Until you realise that accounts to $1million only generate 15% off this clients business, the of resources to these segments seems far to tight. But in the light of how much these segments contributes to revenue an argument can be made that if anything it is too much|
|$1-$5million||Manage primarily with your sales force. Allocate a dedicates sales manager. Schedule monthly meetings, minute action items, ensure follow up with internal sales. Track contacts and develop company profiles. Ensure company features in the weekly sales meeting at least once a month to share profile. Ensure that each sale is followed up with|
|$5million+||Manage with your sales force. Assign a global account director and local account representatives. Schedule executive visits from your company with senior contacts. Coordinate activity through a dedicated large account plan, provide bi weekly updates to an account implementation plan and seek to develop relationships with key stake holders. Create, update and manage accounts through active stakeholder engagement plans …|
By reducing the number of activities in less valuable accounts and re-directing this to those that provide most of your revenue, you position yourself for growth. However, it is seldom as easy as declaring the new way of working. Your account teams are comfortable with the accounts they visit today, they have developed relationships there that they do not want to desert. If you simply pronounce the requirement for change your sales force will quickly revert to the old ways of ‘business as usual’. So how do you go from intent to ensuring action?