While there is still hope that we do no slide into another recession in the 2nd half of 2022 or early 2023, it is clear that we face a period of slow growth.
The Euro Area Economic Sentiment Indicator (ESI) is steadily declining (source: https://tradingeconomics.com), showing an overall low confidence of decision makers in the near term economic future.
Reduced confidence results in delayed investments, lower stock keeping and overall decreased purchasing activities coupled with longer and more complex decision cycles.
Now a well prepared B2B sales team can manage an economic downturn and ensure a steady deal flow, but unfortunately most sales forces are still woefully unprepared for a shrinking or slower market.
Here are 5 tell-tale signs that your sales team is not prepared to face a difficult market development:
Your deal closure rate for qualified leads is below 10%
You do not quantify your customer's financial impact from buying your product / service during discovery
BANT is at the core of your sales force discovery
Your sales force does not know where deals are delayed or stopped on your customer side
Your sales force action items for closing a deal are less than 5 per deal
Each of these signs points out clear problems in your sales process.
1. Your sales team is overreaching
Too many sales people still falsely believe that the more sales lead they get into their sales funnel, the better. It gives them a false sense of high engagement for the company. I rather prefer a 'lazy' sales person, who deals on average only with 5 leads but closes regularly 50% of them in a timely fashion with little drama over a busy sales person constantly juggling dozens of leads with fluctuating closing rates between 5 - 15%, long lead times and lots of last minute drama.
The reason is that the first sales person is likely investing his time to:
qualify his leads well
conduct a thorough discovery
identify a clear gap his product offer can close, and
support his customer contact during the decision making process.
Especially during an economic downturn it becomes crucial to do these activities well, leading me to the next point.
2. Your sales team is not supplying a strong argument
Customers are more risk averse, as they can less afford low fit - low impact purchases.
Therefore making sure you understand the gap your product can close and being able to quantify the impact your product has on your customer is crucial.
Seeing a clear, quantifiable, positive impact from purchasing your product or service is the best argument, even during a recession as it addresses your customer's underlying core needs.
3. Your sales team is conducting poor discovery
BANT (budget, authority, need, timeframe) is an ancient framework to qualify leads. It is heavily based on the idea that:
customers know exactly what they want (aka they have full understanding of their problems as well as complete overview of all available solutions)
purchases are entirely routine operations and not potential game changers (see my post on out-of-the-box thinking to identify gaps for an example how a sheer commodity can become a game changer)
Instead of hunting for information on the exact specification and the budget allocated for the purchase, your sales force should focus it's discovery on a deeper understanding of your customer's problems and processes (see my post on discovery for more details).
4. Your sales team does not understand your customer's decision process and criteria
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5. Your sales team does not actively manage the different stages of your customer's decision process
Most sales people do not understand:
their customer's decision process,
the stakeholder involved and
their individual decision criteria.
They leave it to the customer contact to ensure that the deal they have 'hammered' with the contact gets 'pushed through' the organisation towards deal closure. And they are helpless when deals get stuck inside the customer's organisation because of this.
A good sales person focuses significant energy during discovery on understanding the above and to manage the different micro sales necessary to ensure that a deal moves smoothly through the organisation and towards a structured and timely close. (See my post on managing the all the small sales during a deal closure for more insights.)
If you want to have an outside view on your readiness or in case you feel you could use help to get ready for the challenge, feel free to contact me for a free initial consultation to see how I can help you create a truly quantifiable impact offering.
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