Backward Sales Planning

I was reminded of this drill when discussing a tech company that sought to major on one particular recently bundled new(ish) product.

Classic backward or reverse sales plans begin with your total Number.

What revenue must you hit to reach 100%. Or more aptly, say 110%.

You’ll need to know your average deal values.

Then simply divide your target by that typical sales till ring per customer and you’ve got how many overall sign-ups will make your number.

What I’ve always liked about it, is that you need to have a grip on your ratios. And as I always say, treat Sales as a numbers game at your peril, because it is really a ratios game.

Work back through your funnel stages.

How many deals do you take to the final stage, and what proportion of these do you close. Hint; for any decent solution seller this should never be worse than 1 in 3. And should really be better than that.

Then going back, how any campaigns must you instigate that whittles down to those you take all the way. Whiskey distillers lament the Angel’s Share. The amount of golden elixir they lose through evaporation during the maturing process. We also lose precious liquid. Whether it be from general slippage like project stalling, cancellation, fatal spec creep or our own qualification out.

Use all your stages between lead to close, if applicable. Such as longlisting to first meeting to proposal to shortlisting to final presentation to passing onto legal. Or whatever your gateways are.

It is also helps if you know the likely breakdown of incoming leads. In terms of eventual status. These can range from no fit whatsoever, through tyre kicker, all the way to urgent green light.

Then you’ll gain a handle on how many prospects you need to fill your pipeline with over the period to ensure you’ll likely hit your number. Giving you such illumination as how many cold calls it takes to beat quota.

An added bonus is that once you are aware of your ratios, you can then set about improving them. Meaning refining your process – so fundamental to sustainable, repeatable success – becomes a key focus.

This ‘reverse revenue planning’ style task is also useful to help you mobilise the resource you’ll need to make it happen. Whether that be anything from business development time to mailers to seminars to pre-sale bodies to executive accompaniment (to even, delivery resource). Put your requests in early and you can become the star you deserve to be.

footnote: There’s also a crucial Buyer mirror to this.

Timeline Selling. An oft-overlooked tool, possibly because it requires discipline of playing the long game with which few of us are now blessed in our instant digital world.

You ask when the prospect would like everything in place for. Not forgetting the essential follow-up of precisely why that exact date looms on their horizon. You’ll need to pluck that urgency card from your sleeve later, no doubt.

Take said date. Then simply work backwards from it. Running through all the steps required to reach their shangri-la.

Go Live, Testing, Implementation, Delivery, Sign-up, Resource Allocation, Board Approval, Final Presentation, Shortlist, References, Benchmarking, Longlist, Specification, ITT, Budgetary Release.

There’s a long series of several, many interchangeable, some in parallel, steps.

When confronted with such a buying process, your prospect often sways a little. Such a lot of work, so little time. If only they’d have started this project last year. Best we get cracking…

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