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How to Craft a Practical Sales Plan for Your Growing Business
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This blog post on how to create a practical sales plan for your business originally published on Bplans.com, a free service that helps entrepreneurs create effective business plans and fundraising pitches that appeal to investors and bankers. CDC Small Business Finance proudly offers the company’s LivePlan tool to our borrower clients.
Taking the leap into entrepreneurship is a bold move. Many have plunged and crashed because they were ill-prepared. Many professionals emphasize having a business plan, and this is a good thing. However, if your business is going to sell tangible goods, a smart sales plan is equally important.
What are the best strategies for a working sales plan? Why do they matter and what are the steps to organize one for your business?
When you have a sales plan that supports your business plan, your execution should yield positive outcomes. Whether you are a business owner, a sales manager, or a strategist, this article is for you.
Grasping meaning of a good sales plan, why that matters
Every business exists to achieve a specific objective. For those who want to drive sales, a sales plan is the roadmap for guiding you toward achieving those goals.
What is a sales plan? It is a month-to-month estimate of the quantity of sales you intend to achieve, and the steps you will take to get there. It includes previous sales, market conditions, specific niches, and your customers — how you are going to identify them, communicate with them, and sell to them.
When executed correctly, a sales plan gives you control and leverage in growing your startup, instead of simply attending to day-to-day sales tasks. With this information, you can confidently identify any impending issues, sales droughts, or prospects and act quickly on them.
It may seem like a lot of work right now, but once you can answer these questions, you’ll be able to take your sales and business to the next level.
How to create a successful sales plan, step-by-step
1. Set realistic goals
Every sales plan needs an end goal — something to measure your actual values against. For this, a figure is required, whether it is the number of sales to expect by the end of a quarter or the number of customers you convert to buyers. This figure helps you determine how successful or far from the mark your results are.
Setting realistic goals will depend on factors such as the market size, company objectives, and the resources or experience available to your sales team. (You are probably aware of what and how to set SMART goals. If not, here’s a helpful primer on how to do that.)
Common mistakes you should avoid include
- Being overly optimistic
- Neglecting your own assumptions
- Shifting the goalposts
- Failing to ask for sound advice
- Not having a feedback mechanism
2. Have clear deadlines and milestones
You need to know if the assumptions you are making in your sales plan are close to your target. To do this, split that big plan into smaller goals (also known as deliverables) with strict deadlines. These are milestones. Whether you have achieved a certain number of leads for the half quarter or sales target, these milestones are useful in telling you whether you are on the right path.
Having clear-cut deadlines and manageable milestones requires research and time to develop. They should motivate and challenge your sales team without being too difficult, or it can lower their morale. Start with the figures from last year, track the exponential increase in sales and compare them with your industry’s present realities. This should be able to inform the milestones you’ll need to set.
3. Select a suitable niche and focus in
The previous steps have helped set a bullseye that you want to hit. The next steps are about filling out your sales plan. The first thing to do is understand the market you operate in and the niche you serve so you can position your business properly for growth.
A business niche is simply an area of specialization. For example, you may own a sweets shop, in which case your business would be known to specialize in confectionery. However, you can continue refining your specialty by drilling into some nuances. Your niche also comprises your content, company culture, branding, and overall business message. This is how you stand out from your competitors and get recognized by your target audience.
Be specific; choose a target market. Returning to the sweets shop, would your products be aimed at children? Or would you focus on selling vintage sweets in which case you’d target adults of a certain age? According to serial entrepreneur Jason Zook, “When you try to make something for everyone, you end up making something for no one.”
Ask yourself the following questions and spend some time on market research:
- What is the market size?
- Is there an inherent need for the product you are selling?
- What is your market position? (Conducting a SWOT analysis can be helpful here.)
- Who are your competitors and what their current strategies?
4. Know your target customers
One of the worst decisions any startup will make is to spend money and effort on the wrong set of customers. You are already hard-pressed on a growth budget, so wasting it kills the business fast.
Conduct research to identify the targeted audience. Scour the internet and glean as much information as possible by looking at the latest trends. You can even compile surveys to gauge relevant feedback.
Once you know your niche, do everything to find out what you can about your customers. For example, what is their profile — their language, typical online behavior, and product preferences? What you look to define will depend on your company and the nature of your market.
However, for a startup, it’s best to begin with basics such as their geographical location, work information, purchasing power, and so on.
Also, find out:
- If they are on social media, and their choice of network.
- Do they belong to any LinkedIn or Facebook groups?
- Can you answer their pain points on Reddit or Quora?
- What do they read and what podcasts do they enjoy listening to?
5. Prepare a plan for the customer’s journey
Once you have your typical customer profile figured out, the next step is to determine how to make them your customer. This can be achieved by simply charting out their journey from prospect to loyal customer.
To understand what you need to know about your potential customers, ask these questions:
- What issues do you want our product to help you solve?
- What attributes are most important to you, and why?
- What budget do you have for this?
- How are you presently solving this problem?
Good salespeople take their buyers on a journey every time—from attention to interest, desire, and action. The AIDA model is a great tool for achieving conversion via a sales funnel. When you guide them faithfully through this process, your customers should eventually convert.
6. Define your unique selling points
You know your customers and the path along their sales journey. The next step is to plug your services smartly into the path, in the best possible manner. You can do this by defining your unique selling proposition, or (USP). This is what differentiates your business from other players in the market.
Know your customer base by asking them the following questions:
- Exactly why do you patronize us?
- What would make you choose our competitors instead of us?
- Why do you think some prospective customers would not buy at all?
- What steps do you think we need to take to attract more customers in the future?
To find out just what customers are looking for and why they might patronize your business, try surveying them to gauge opinion. Offer such surveys online and make it simple and straightforward for people to proffer the relevant feedback.
It’s important to remember that people buy benefits, not features. Avoid getting lost in the color or model of your product when describing it to the customer. Rather, outline what it would do for them: the problems it will resolve, and the advantages of buying it.
7. Build a list of prospects
Armed with the knowledge of the customer type you want and the benefits you are going to sell them, the next step is to build a list of prospects. That is generating leads of potential customers to try your theories on.
A prospect list is a directory of real people you can contact — those who will ideally benefit from your services or products. Building this directory is one of the major tasks of a salesperson, but they can be obtained nonetheless.
From your customer profile, target the following:
- LinkedIn for prospects
- Relevant local business networks
- Network seminars and conferences
- Perform Google searches (to identify buying trends, for example)
- Work with leads generating companies like Salesripe
8. Take advantage of existing client relationships
A widely known marketing concept is, it’s significantly cheaper and more rewarding to retain existing customers than go after new ones. In other words, focus a good amount of effort on customer retention rather than customer acquisition.
According to Gartner research, 65 percent of a company’s revenue comes from existing customers, and it costs five times as much to attract a new customer than satisfy an existing one. Leverage this relationship by offering occasional loyalty rewards. Examples include accumulated points systems, redeemable gift cards, discounts, and so on.
Another way to gain from existing customers is to ask for referrals. People trust recommendations from their peers more than your sales pitch. Additionally, some companies offer incentives to current customers who introduce a new buyer.
9. Look for strategic partners with the same goal
Don’t solely focus on acquiring paying customers. Seek strategic alliances with companies and other businesses that could benefit you. They could even be your competitor; success is not always about fighting, but collaborating.
You can meet up with these people at conferences or sites like Partner Up. Other professional networks also provide a reliable platform to interact with like-minded individuals and companies. For instance, if you manufacture toilet paper, then you could connect with magazine companies or recycling organizations to gain access to their by-products.
10. Track, measure, and tweak
Now that you have the makings of a solid sales plan, it doesn’t end here. You need to have a process for comparing your success — checking results against the original goal. If you don’t know how you performed, you can never adjust for improvement or to replicate future successes.
Many digital platforms help with this stage. For example, Google Analytics provides a dashboard that includes an overview of sources of your biggest sales, the best and least performing days, revenue growth, leads to conversion rate ratio, and so on.
It will also be important to be able to quickly and easily monitor your financial metrics—a business dashboard can help, but it’s possible to track your progress manually using Excel spreadsheets. The advantage of this process is that each metric can be tweaked as the sales process is ongoing.
This means you have full control of the entire activity.
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CDC Small Business Finance is a champion of all entrepreneurs in any stage, particularly women, veterans and minorities. We offer several loan options for business owners who want to grow their operations and are planning for their long-term needs.
Tell our loan experts about your business, and they’ll work to match you with a financing plan that best suits you. Let’s talk! Reach us at loaninfo@cdcloans.com or (619) 243-8667.
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