Why is this important?

Sales Strategies and Sales Plans

The terms Sales Strategy and Sales Plan are often used interchangeably, and more often confused as one and the same thing, however there is a marked difference between the two.

A Sales Strategy defines how and why a Sales Plan will work. A Sales Plan is the implementation of the Sales Strategy, usually for a given period time. The implicit connection between the two is the ‘Desired Result’.

A Sales Strategy is developed with many interested parties in mind – business management, its owners or executive, its partners, its financiers, its suppliers, its customers and its sales force. Every one of these parties will benefit from different aspects of a clear and well defined sales strategy. A Sales Plan, on the other hand, is defined by business management for its sales force.

What to do

Planning for success

Often we hear business owners say that their sales strategies and plans are “all up here – in the head”. Unfortunately this approach restricts growth and results in missed opportunities.

We all find planning a tedious, tiresome and time consuming task. Too often, smaller business owners shortcut or neglect the planning process. When it comes to sales planning, ask the question “Do I really have the time to plan for revenue, profit and success?”   

Successfully growing businesses have taken the time to develop their strategies and plans and consider all impacts to their business. 

When developing a sales strategy, consider all parties who will benefit from, or have an impact, on its success. Develop the strategy with that one objective in mind – success. Plan for a successful end result while accommodating and/or rectifying any failures along the way.

A Sales Strategy should be detailed enough to answer all questions from interested parties and simple enough for them all to understand. If it begins to look complex to you as the developer of the strategy, then it’s probably too complex for anyone else to understand. Keep it simple, but appropriately detailed.

Interested parties

We’ve already mentioned some of the parties who will/may have an interest in your Sales Strategy, now let’s look at what some of their direct or indirect interests may be:

Business management

Any higher level/s of management will have an interest in the strategy as a whole. Some of the questions your strategy should answer include:

• What is it?
• Does it fit in with our business model and plan?
• Does it compliment our business?
• Do we have the resources and capabilities to produce/sell/deliver/support it?
• Will it be profitable?
• What will it cost us to finance it?
• What will our Return on Invest (ROI) be, and over what period of time?

Partners

Your business partners will most likely be interested in your forecasted end result and the logic of your strategy to achieve that end result. Is it a realistic forecast? Is it worth their investment? Your strategy should reassure them that it is.

Financiers

If your product and/or service requires a capital outlay and the business has to borrow to finance it, your financiers will need to see your financial projections. Your forecasts and projections will form an integral part of the Business Plan [LINK] that your financiers will request.

Suppliers

While you wouldn’t share your Sales Strategy with your suppliers, it is important that you discuss your requirements with them. Can they meet your demand/s and/or timeframe to supply their products/services? It’s critical that you discuss your forecasted requirements with your suppliers before you commit them to your strategy.

Customers

While you don’t disclose your Sales Strategy to customers, you will indirectly share parts of it with them through your sales force. The communication and representation of your products and/or services should flow directly from your Sales Strategy.

Sales Force

Whether your sales channel is a direct sales force (your sales staff) or an indirect sales force (resellers, distributors, etc), your Sales Strategy should address how your product/service should be sold and what consistent message/messages are communicated to the end customer.

You may want to promote the company brand [LINK] with each sale, you may want sales to correspond with a marketing [LINK], you may want to push a pricing message [LINK] with each sale, or you may want to promote other or additional products/services with each sale.

Your Sales Strategy should clearly detail your 'rules of engagement' between your sales force and its customers. While you wouldn’t share your complete Sales Strategy document with your sales force, any 'how to' components should be clearly identified and appropriately communicated to everyone representing and/or selling your product and/or service.

Competitors

Competitors are the group most interested in your Sales Strategy. They are the group most affected by it and also the group who will impact your strategy more than any other.

Ensure your Sales Strategy address the facts about your competitors, if nothing else:

• Who are they?
• What are their strengths and weaknesses?
• How do they sell?
• How much do they sell?
• What else do they sell and to whom do they sell?

It is critical to identify and address as much information about your competitors and their products and/or services as you can ascertain.

Invest in research not in failure

Though stating the obvious, it’s worth reinforcing the value of research. There’s no getting away from the fact that research is time-consuming and often costly. Whether you conduct the research yourself, outsource it to a third party or buy it, it is your smartest investment when taking a product and/or service to market.

Your Sales Strategy must be based on and supported by facts. Too often we convince ourselves that 'gut feeling' equals fact. While your Sales Strategy will contain assumptions, they should be highlighted as assumptions and derived from fact/s.

Many business owners feel that 'the best research comes from the field'. While that may be true, information from the field should be viewed as an adjunct to your research. Your Sales Strategy should be based on information and facts which are researched and established long before anyone goes out to the 'field'.

Identify the risks

All strategies and plans involve varying levels of risk. Planning for success involves planning for reality. Reality involves both negatives and positives. While playing-up the positives of your strategy, it is important to anticipate and identify any negatives along the way, and discuss your plan to overcome those negatives and mitigate risks should they arise.

Communication is the Key

All too often, the process and output of strategies and plans are shrouded in management 'secrecy' and may even be locked away! In reality however, their usefulness has only just begun.
A Sales Strategy document, in its completed form, may be extremely confidential but much of its content, however, is of immense value to the sales force and should be shared with or communicated to the sales force before the product/service is taken to the market.

Tips for communicating your Sales Strategy to staff

• Why will it sell?
• Who will buy it?
• What are its strengths and weaknesses?
• Who/what are the competitors?
• What are its differentiators?
• How is it priced with regard to the competition?
• How big is its market?
• Will it be supported by advertising and/or marketing campaigns?
• Which other products can, or should, be sold alongside it?
• What does its lifecycle look like?
• Will it be upgraded or replaced in any period of time?
• What are your 'rules of engagement' between the sales force and customers?
• What are the key messages that the sales force should deliver to customers?
• Are there after-sales activities that should be addressed before or after the sale – support, training, implementation, warranties, servicing, replacement parts, authorised repairers etc
• Are there additional products/services that can or should be sold with, before or after this product/service?

In the rush to get to market, many smaller businesses overlook the need for a proper and thorough sales force briefing.

Remember, your Sales Strategy will only be as successful as the people who implement it.

Where to go for help

Do it yourself

Call Australian Business Marketing Services 1800 505 529 to engage a consultant, or visit our website.

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