As a small business owner, it’s natural to want to shoot for the stars. At the same time, setting realistic sales goals for you and your team tends to be a more ideal approach. After all, if you set the bar too high, your sales staff may feel overwhelmed and underappreciated if they don’t hit the goal. Set it too low, and they may lose motivation.
Setting achievable goals helps your company to grow in organic steps that make sense, allowing everyone to celebrate each victory on the road to success.
1) Consider Your Team’s Abilities
As a team leader, it’s important that you recognize the unique skills and experience that each salesperson brings to the table, as well as the size of your crew. Understanding what’s truly feasible based on your unique sales force helps you to come up with a reasonable figure that your team could hit comfortably.
You can analyze past sales to get a better idea of what’s possible, and from there you can set a slightly higher number so your sales team has a number to strive for. As you go, you can always change that goal as more data comes in.
2) Analyze Your Customer’s Spending Habits
The sales goals of a used car company are going to be vastly different than those of an small textile company. While the car company is going to have more money coming in from every sale, there are also overhead expenses to consider too, so one isn’t necessarily going to be more profitable than the other. First, consider how much money the average customer spends per transaction.
Then, take a look at how many sales you typically make within a month (or your preferred time period). Now, you have two figures that allow you to set realistic goals.
Say your typical customer spends 10,000 rupees per transaction, on average. You can encourage your sales team to upsell customers and try to raise that average to 11,000 rupees. Additionally, say you typically get 50 customers per month, you can also try to boost that number to 60. You may have good and bad months, but simply figuring out those typical numbers gives you a starting figure that you can adjust each month.
3) Incorporate Promotions
If you decide to run a special, send out coupons, or implement a customer loyalty program, you may need to adjust your target goals. Of course, the nature of your promotion is going to determine how much sales growth you can expect. If you’re offering a product or service for 50 percent off, you may want to try to double your typical sales in order to remain profitable.
However, even if you end up losing some money by running a promotion, you’re still gaining new customers that may come back and refer other people, so be sure to also think about the bigger picture and the long-term growth potential. Sometimes you have to spend money to make it.
As you set sales goals, remember that they don’t have to be set in stone. If your sales force tries their best but still falls short, that may simply be a sign that your sales goals are unrealistically high. Running a successful business requires trust, so you may need to give your salespeople the benefit of the doubt.
In order to encourage your sales staff to achieve goals, consider offering incentives. Even something small like a free lunch can be a powerful motivator. Keep the atmosphere fun and uplifting so your team genuinely wants to hit and surpass sales goals — that’s the key to keeping those numbers rising.