As I work with distributors who want to experience explosive sales growth (growth greater than 20% year-over-year), we first write or update their three-to-five-year strategic plans, then we develop a sales plan to execute and deliver the growth results they desire in revenue, market share and profit margins.
Often, distributors have a clear vision of where they want to be each month, quarter and year in terms of revenue and profits. They shaped the “where” of sales and profits objectives, but failed to address strategy — the “how.”
Creating a comprehensive sales plan and strategy is essential for driving explosive growth in market share, revenue and profits.
Here are the top 10 steps to writing a sales plan to deliver explosive sales and profit growth:
1. Define Clear Objectives — and Your Strategy to Grow Revenue and Profits
We want to start by outlining your sales goal. Then, we dive deeper into where you expect sales to come from, write that into our sales plan, and plan by each territory.
- Do you plan to introduce new products?
- Do you plan to grow organically, through acquisitions, or both?
- Do you plan to sell current products in new markets?
- Do you plan to win a greater share of wallet with key customers?
- What is your sales goal for new customers?
- What is your sales growth goal from large key accounts?
Clear, measurable objectives provide direction and benchmarks for success.
2. Understand Your Customers and Market
Conduct thorough voice-of-customer research interviews. Here, we interview your A, B and C customers, and prospects you quoted but did not win. Identify your target audience, their needs, preferences, and pain points. Understand the competitive landscape and pinpoint opportunities for differentiation.
- What market, economic and/or global trends are occurring, and how might your customers feel about them?
- How are these trends – and, often, constraints – impacting your customers’ bottom lines?
- We review our strengths, constraints and weaknesses.
- We clearly understand your current state — and the current state of your company, markets and customers.
- Are your customers satisfied and planning to grow with you, or are some planning to defect this year?
The time to save a large, key customer is before they leave, not after.
3. Analyze Current Sales Transaction Data
Review historical sales data to identify trends, strengths and areas for improvement. This analysis helps set realistic targets and understand what has worked or failed in the past.
Many teams build their sales plan from the top – the goal – down. We recommend building your sales plan from the customers up. Determine expected revenue from current customers, compare that to your goal, and our plan needs to close that gap.
- What is our close rate on quotes?
- Are customers buying one or two products and services or our entire portfolio?
- What percentage of total revenue do your large accounts represent?
- What accounts were in your top 20% in the past but are not today, and why?
- What accounts stopped buying in the last six to 12 months?
- What products and services delivered the most revenue in the last 12 months?
- What products used to be among your top products but are not today, and why?
- What is your net profit by customer?
- What is your net profit by product?
Gathering the above helps identify trends and actionable insights for our sales plan. Sales plans must be written leveraging actionable insights from our data, not assumptions or how we have always done things.
4. Set SMART Goals
Establish “Specific, Measurable, Achievable, Relevant, and Time-bound” (SMART) sales goals. These should include targets for revenue, number of new customers, retention rates or market expansion.
We establish leading and lagging key performance indicators (KPIs). We have found leading and lagging KPIs are often unique to each company. For example, one of my manufacturing clients found that when clients visit and tour their facility, it increases sales and improves retention and customer satisfaction — so we created a KPI for strategic account visits. Distributor leading indicators could be the number of new account meetings and quotes.
5. Craft a Value Proposition That Resonates with Decision Makers
Define a compelling value proposition explaining why your distribution company is superior. This should address your unique benefits and solutions that meet your target market’s needs. We develop a value proposition for our company and specific messaging for each decision-making persona.
We must connect the impact you deliver to your customers in these value messages and train sales on how and when to use them.
Often, sales teams cannot articulate their company’s value proposition, so we help them with training and coaching. If your sales team cannot share “why your company” ... they are losing orders that they should have won.
We customize our value proposition based on how the products and services you deliver can be felt (create value for them) by each of the above, based on our knowledge of what is important to them and what we learned in discovery calls.
6. Develop Sales Strategies
Outline the strategies you will use to achieve your sales goals.
Here, we review our competitors’ strengths, weaknesses and positioning. We review our strengths, weaknesses and constraints. We develop strategies based on how we position our products and services compared to our competitors. We are also aware of market challenges and constraints. We emphasize our distinctive competence and reinforce the impact our product or service will have on the customer’s bottom line.
We develop our strategies by leveraging the insights from the voice of customer research, market trends and transaction data.
In our strategic business growth plan, we must align our sales strategies with your organization’s growth strategies.
7. Create an Action Plan
Break down your strategies into actionable steps (tactics). Assign tasks, deadlines and responsible parties. An action plan ensures everyone on the sales team knows exactly what needs to be done, by when, and who owns it. We have seen the best success when we include the salespeople in designing their actions and timelines. After collaborating on their specific growth plans, we create performance agreements with each salesperson.
8. Determine Key Performance Indicators
Identify the KPIs that will help you measure progress toward your goals. Standard sales KPIs include conversion rates, sales cycle length, customer acquisition cost, average deal size, number of quotes, meetings and number of outbound prospecting calls. We want to track results, lagging indicators, and activities and behaviors that lead to sales or leading indicators.
We establish KPIs by year, quarter, month, week and, often, by day.
Again, I suggest collaborating with and coaching your salespeople. They must write the goals and KPIs and when they plan to achieve them.
9. Train Your Sales Team
We’ll need to ensure your sales team is well-trained and equipped with the necessary skills and knowledge to achieve our plan. We have found distribution salespeople often have strong product knowledge, but 50% have not received sales skills training. We recommend a Sales Effectiveness and Improvement Analysis. As we work with distributors, we often find over 80% of net income comes from 20% of your sales team, 60% of the sales team maintains current business, and 20% of your team is not producing (not effective in sales roles) and often has no desire to be in sales.
We gather data to prescribe training and coaching, so the sales teams hit their growth targets. Increasing the results from the middle 60% of the sales team significantly impacts revenue and profits. Imagine if the middle 60% of your sales team had a 10% increase in performance this year. What impact would that have on total revenue and profit? The 20% who are not performing are coached and trained up or coached out into other roles where they will deliver more value.
Before one of our clients hires more salespeople, we assess the current teams’ sales effectiveness and improve the results of current team members.
- Do your salespeople sell based on price and availability, or value?
- Is your sales team skilled at building professional relationships, or are they transactional?
- Are your salespeople leaving money on the table because they lack negotiation training?
- Do your salespeople know how to close?
- Are your salespeople committed, motivated and have high accountability?
Regular training sessions on product knowledge, sales techniques and industry trends are crucial for maintaining a high-performing team.
10. Monitor, Evaluate and Adjust
Monitor your sales performance against the established KPIs weekly. Regularly evaluate the effectiveness of your strategies and make necessary adjustments. I have yet to help write a sales plan that did not need adjusting after we started implementing it. Flexibility and responsiveness to market changes are essential to sustained growth.
Sales and branch managers meet with their teams one-on-one and discuss their performance agreements. They help sales be accountable to their plans and behaviors to drive revenue and profit growth. In most cases, sales and branch managers will require sales management training in skills like coaching, recruitment and helping sales teams move sales through the pipeline.
By following these 10 steps, you can develop a robust sales plan and strategy.
- Does your team need to update your strategic growth plan?
- Do you need a sales plan?
- Does your marketing plan support your sales plan?
- Do you have sales goals and plans for each salesperson?
Clear objectives, thorough market understanding, sales skills training, continuous evaluation, and adjustment are the cornerstones of a successful sales plan.
Mark Allen Roberts is a senior-level sales and marketing leader, author, speaker, sales skills trainer and sales acceleration coach who writes the popular business development blog No Smoke and Mirrors.
