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Tracking net sales per day causes you to pay attention to issues you may not have known. Generating these numbers is worth the effort every morning because it brings your firm’s health to everyone’s attention in the form of a simple number. Talk about this because whether people are interested or not; it is the funding of your paycheck. Are we ahead or behind?
Ask your managers for sales forecasts. Chart actual sales (earned sales, billings, and shipments) against these official monthly sales forecasts every day. When managers give a forecast, they do want to fail.
Are you ahead or behind? If you are short of month-to-date forecasted sales, find out why. Remind people if the company is running behind in shipping out orders there is ample time to fix these problems. If you are ahead, rejoice and give credit where it is due, but follow-up to ensure the trend will continue and is not a temporary fluke (one large shipment one day, few for the next few weeks). Tell the good news as well as the bad.
What departments, products or services are causing the sales shortage? What profit centers are running behind? Are there large shipments scheduled to go out later in the month? Are there delays in outside processing, or outside services or other reasons why sales are slow against what we originally thought we would do? Posting the number reveals lots of problems.
Ask the forecasters why sales are behind. Go to the sales department and begin asking sales rep by sales rep where the slowdown is occurring and who needs a sales visit. Which customers’ buyers are not buying? What companies have slowed down their economic activity? The newspapers will normally indicate slowdowns in your area and industry although they will normally be behind the actual trend by the time you finally read about it. Your sales history will precede TV and newspapers.
Is your production bogged down? Do you have maintenance problems? What department is delaying shipments? Your production people on the floor know what area is behind. Is there a problem machine, operator or other area that is backed up? They have probably complained about it themselves. Are we missing people in key positions? If positions are vacant or not established, have job descriptions been given to Human Resources to find qualified personnel.
What are your customers’ buyers’ plans? Somebody should have already asked buyers what they intended to buy over the next few months. This information is brought back and folded into the sales forecast. You are paying your sales people to take these people to lunch, entertain them and spend face-time every week. This is the least you should expect from your sales reps unless you have not required this feedback. Ask for a forecast every week or month.
If customers are cutting back, this flattens your wallet. If your sales representatives tell you enough to know that spending may slow down in future months, your sales forecast will reflect this. Your numbers are going to drop. This tells you to slow down all discretionary spending. Have previous forecasts been reasonable and in line with what happened? If so, forecasts of downturns should be taken seriously, especially if heard from a number of firms giving your people feedback. Think what else needs to be done to correct this lagging, month-to-date, actual sales number? Consider cutting overtime, cutting discretionary spending and if severe enough, think seriously of possible layoffs.
When business slows, go after other existing business opportunities. At the same your buyers are cutting back on their orders, you need to try to secure more business from them by broadening your offering. Possibly offer to cut his costs if you take larger orders, try to convince him you might keep stock on the shelves for him if he sends more business your way or begin to ask what else he farms out that your competitors are receiving.
Find more sales or new revenues. Find out what these possible revenue sources are and go after them. Teach your sales representatives to think outside their order parameter and discover more about what these buyers need to purchase. What is the chance your firm can fill gaps with these additional revenues?
The sales manager should help close the sale when necessary. If the sales representatives need help in this area of sales, the sales manager needs to go on the visit, observe and step in where appropriate and authorized to make company commitments if that is what will complete a sizeable order. Sales managers turn into sales reps when necessary and on call.
