Sales Process and related issues

A firm’s sales process depicts the steps it goes through to identify prospects and close sales. It doesn’t matter whether a firm is selling directly to customers or through intermediaries; it still has a process through which it makes sales. If it’s selling through an intermediary, like a distributor, it has to convince the distributor to carry its products and has to offer the distributor varying levels of support.

Some companies simply wing it when it comes to sales, which isn’t recom- mended. It’s much better to have a well-thought-out approach to prospecting customers and closing sales. A formal sales process involves a number of iden- tifiable steps. Although the process varies by firm (and industry), it generally includes seven steps, as shown in Figure 11.5. Following a formal or structured process to generate and close sales benefits a firm in two ways. First, it enables a firm to fine-tune its approach to sales and build uniformity into the process. Second, it helps a firm qualify leads, so the firm can spend its time and money pursuing the most likely buyers of its products or services. The most frustrat- ing thing a salesperson encounters is spending time and effort working with a potential buyer, only to find that the buyer doesn’t have the money or the au- thority to make a purchase. A well-thought-out sales process has triggers in it that help a salesperson discern whether spending time with a particular pros- pect is a good use of his or her time.

Some firms implement their sales strategy by listing the seven steps in the process, and then writing procedures for how each step will be implemented. In fact, some new ventures include this material in their business plan, to provide the reader confidence that they’ve thought through how they’ll close sales. An example of a sales process, with accompanying action steps, for a fictitious business named Prime Adult Fitness is shown in Table 11.5. The ex- ample comes from the book Preparing Effective Business Plans, Second Edition, by Bruce R. Barringer (co-author of this book). Prime Adult Fitness is a fitness center for people 50 years old or older. Its mission is to make exercise and fitness a vibrant and satisfying part of the lives of people who are 50 years old and older. The company will start with a single fitness center located in Oviedo, Florida, a suburb of Orlando. The steps shown in Table 11.5 outline the process the company will use to recruit members and is the method that the in-house staff will follow when people walk into the center and inquire about membership. At times the process will take weeks to unfold, for example if Prime Adult Fitness employees have multiple contacts with a prospect, and at times the process will take only a few minutes, such as when an employee provides a prospect a tour of the facility and answers specific questions. Prime Adult’s sales process is offered only as an example. Individual firms can use this example as a template for developing a sales process that fits their indi- vidual products and circumstances.

Mapping the sales process in the manner shown in Table 11.5 provides a standard method for a firm’s employees to use, and provides a starting point for careful analysis and continuous improvement. Often, when companies lose an important sale and reflect on what went wrong, they’ll find that an important step in the sales process was missed or mishandled. This is where having a well-thought-out sales process, with accompanying action steps and appropri- ate employee training, can dramatically improve a company’s sales performance.

Source: Barringer Bruce R, Ireland R Duane (2015), Entrepreneurship: successfully launching new ventures, Pearson; 5th edition.

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