Linking Human Capital With Strategic Intent
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ABCs of Strategy

Sales Excellence LogoABC’s of Strategy

In some sales training circles, the ABC’s of selling stands for;

Always BClosing

That is certainly worthy of noting and a great strategy, one I subscribe to myself and one you should adopt, but more on that another time.  I am referring to the ABC’s as a strategy based approach that is focused on optimizing your time, your income, and your account management strategy.

Where and how should you be spending your time?  Obviously – where it pays you the biggest dividend.  It takes no more time to make $35,000 per year than it does to make a $100,000 per year.  Your “Dollars Per Hour” are equated to how SMART you work, not how HARD you work.

You have likely heard the saying, “Plan your Work and Work your Plan.”  You must have a plan! Anything else is just shooting from the hip.  In sales you have the ability to leverage your time.  Do the simple math.

Let’s say you are selling something to the hospital community.  If you have 6 hospitals in your territory each with 3 -5 buildings, that will generate a certain amount of opportunity and a certain amount of sales dollars.  If you have 6 hospitals each with 6-10 buildings, a higher amount of sales dollars will be generated.  Now here is the really tricky math. If you have 6 hospitals, each with 15 – 18 buildings or more……. well you get the point.

The rules of engagement apply universally no matter what you are selling but your time needs to be managed based on who you sell to.  If you are selling to the hospital industry, a 200-bed hospital will not have as much opportunity as a 500-bed hospital and so it goes for schools, universities, manufactures, property managers and so on.

Now, does it really take any more time to call on a hospital that has 200 beds than it does to call on a hospital that has 500 beds?  No, it doesn’t.  So from the simple math standpoint, you can make more money targeting your accounts and strategically spending your time optimizing your results.

How do you start?

You need to classify your existing accounts and prospects and manage them accordingly.  This can be done using a ranking system of ABC.  This will help you identify where to spend your time and efforts.

Let’s use the hospital example again (remember, you can do the same with schools, manufacturers, etc.) >

500 Beds is an “A” account
250 Beds is a “B” account
100 Beds a “C” account

Or, rank them by the number of buildings or the number of employees, it really doesn’t matter.  You’re just trying to identify where and how to spend your time.

Due diligence is required.

You start by identifying all the market segments in your territory or market area and researching their numbers. Size up your particular type of business or market and determine what and how you will classify your account mix.  Next set your ABC Strategy for ranking them.  This provides you direction for going after the business that has the greatest opportunity for optimizing your time and your income.

Now that you have your ranking system, take your existing accounts and classify them as A, B, or C.  Do NOT rank them by current sales dollars, but on sales potential.  Next, take your prospects and classify them the same way as well.  Now you have the groundwork laid, your plan of attack developed and have prioritized who you are going to call on.

From a call strategy stand point you spend more time cultivating your “A” accounts than “C” accounts.  You don’t want to lose sight of your “C” accounts, but how you spend your time now gets evaluated in proportion to the payoff.

You should see your Strategic Business Partner and account management strategies begin to unfold.

This is the start of the sales cycle.  Sales cycle refers to the length of time it takes to develop an existing account into a SBP or a prospect into a customer.

Ranking is one thing, but keep in mind; the bigger the customer:

  • the more layers of people and hierarchy
  • the more bureaucracy
  • the longer the call cycle (greater number of people involved in the decision making process)

The bigger the customer…the bigger the sale, the bigger the challenge, and the harder they are to keep.

Also, the bigger the customer the longer the sales cycle, so don’t be disappointed, be patient, and be persistent.  There is more work and more opportunity. That equates to more money and more fun.

Your competitors want the big, prestigious accounts, too.  That means pricing gets more competitive and margins get slimmer.  There is less loyalty and more traffic through the revolving door. With competition there is a higher probability that your customers are more sophisticated and price sensitive.   You will need to be more knowledgeable and professional.  You will need better presentation skills, negotiations skills and closing skills.

No matter who the competition is and what challenges are, identifying and classifying accounts will have the highest payoff of any activity you do.

 


Good Luck, and Go Forth and Sell!

Rick Tiemann

The Executive Group
80 E US Hwy 6
Valparaiso, IN 46383

Tel: 219.477.6378
Fax: 219.477.6379
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