Posts Tagged ‘manager’

Increase Sales And Business Cash Flow by Simply Asking For The Sale

June 19, 2010

by Doug Smith, President, The Woodhaven Group

As CEOs, owners, and senior managers we often spend countless hours analyzing why a sale did not occur. 

Was the price too high?  Is it poor advertising?  Was our product the wrong design? Are we marketing to the wrong customer?

Many times I have found the reason is very simple. 

No one asked for the sale.  You may be thinking that no way does that happen in my company.  You have a selling methodology in place and your sales manager  reviews it weekly in sales meetings.  Well, it happens.  And it can occur in retail stores,  with in home sales persons and in business to business selling situations.

In a business to consumer company I was involved with, we would follow-up the sales visit with a “quality control” phone call to the prospect that did not buy.  Our conversation asked if our sales person was on time, explained the benefits of our product and answered all their questions.  Invariably the feedback was extremely positive on our sales person and many times when we questioned why the prospect did not buy, the feedback would be that they were not asked to buy.  The call would conclude by asking if they were ready to purchase, the prospect often said yes and we would schedule a manager to go write the sale.

Why do sales people fail to ask for the sale?  I have found many sales people do not ask because they are afraid the answer will be “no.”  It is easier to report back that the prospect wanted to “think it over.”

When asking for the sale everyone wants to hear a “yes.”  However, a “no” answer is not bad because now the sales person can identify the objection and overcome it.  If no one asks for the sale then there is no chance to overcome an objection and close the deal.

How can an owner or CEO prevent this problem  from happening?  The best way to identify which sales persons have this problem is for the sales manager to observe the interaction with the prospect at the point of sale.  By doing this the manager can then coach the sales person on what to say the next time he or she is on a sales call.

Failure to ask for the sale is a problem that is never discussed enough with sales forces.

In my opinion, if you don’t ask for the sale then all that took place was a nice conversation. 

That won’t help revenue, cash flow, or profit.

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Am I Making Money? What Happened To My Cash?

April 30, 2010

by Doug Smith, President, The Woodhaven Group

Those are the 2 most basic questions every business owner, CEO, or senior manager should be asking.

Things move fast in today’s business world.  The economy, government, competitors and consumer groups are constantly challenging our way of doing business.

We have a plan in place and doing our best to grow our company everyday.  Is it working the way we want?  There are daily KPIs and dashboards in place to help us.  To me there is only one true analytical measurement and that is the monthly financial statement. Yes, I said monthly.  This is a place not to skimp on spending.  Quarterly or year-end reports are way too late.  Also, I suggest using a CPA.  If you cannot afford one full-time then use a reputable one on a part-time basis.

Monthly financial statements should be 2 things:

  • Accurate:  you do not have the management time to go back and correct bad numbers.  Besides, credibility is damaged when outsiders (think lenders) see you revising  results.  It’s a red flag that there may be bigger problems.
  • Timely:  you want to take actions to correct problems.  Getting a late financial statement means you lost another 30 days to improve.  I want to see financials no later than the 10th of the following month.

Still not convinced you need monthly financials?  Here are 11 important reasons you do need them:

  1. Are you getting the results you planned to get?  If so, then good. If not, then you want to know why, where and by how much you are missing your budget.  Was your original budget even accurate?
  2. It helps hold a manager accountable.  The management team deserves to know what areas are performing and not performing. Each of the managers needs to know how they personally are doing.
  3. There is always an area of the company that needs fixed.  This will help to clearly identify what it is and if progress is being made.  If there are multiple problems then the numbers will help you prioritize what to attack.
  4. If you have borrowed money then your lenders will expect financials.  If there are Board of Directors or advisors they will want to see the direction of the company.  Remember, there may be outside audiences wanting to see your financial results.
  5. The obvious will hit you between the eyes—– good or bad.
  6. Is there a 2-3 month trend occurring?  It could be in overall sales, profit or gross margin.  You also may find a clear trend in an important line item that is costing you profit and cash.  An example might be sales dropping while marketing and accounts receivable are increasing. 
  7. Is a branch location or product line not performing?  Without the ability to measure results you may waste valuable cash and management time  trying to grow the wrong part of your business.
  8. If you operate a seasonal business you need to know your off-season financial performance as well as whether the company executed as planned during your best months.  Example:  retail at Christmas, landscaping during the spring/summer.
  9. It can help your tax accountant by showing him/her whether you are making a profit during the year and at year-end.
  10. It helps you manage and plan cash flow needs based upon what is actually happening.  Do your cash flow budgets need to change going forward.
  11. If you are in an industry that blindly shares financial information, it lets you compare how you are doing against the top performers. 

Daily and weekly KPIs are critical to the success of a business but the monthly financial statement is the final scorecard that tells you if the sum of all your actions gave you the results you wanted.  You may discover the KPIs were wrong.

You must know what is happening with your cash and if  the business is profitable.

A timely and accurate financial statement will do that for you.