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A POWER TECHNIQUE FOR BOOSTING SALES
So you've built your site and started to promote it. You're getting some sales, but you want to generate more.
There is one simple sales technique that almost every Internet marketing expert agrees will DRAMATICALLY boost your sales every single...
Confessions of a Reluctant Saleswoman
This article may be reproduced in its entirety as long as the resource box at the bottom in included. Confessions of a Reluctant Saleswoman By Joyce M. Coleman Like many of my generation and upbringing, I never thought of myself as a saleswoman. ...
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Tammy, a skilled and gifted horticulturist, called me to discuss what she needed to know to start her own florist and landscaping business. She had been in the horticulture industry for 10 years and was incredibly skilled at working with flowers...
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Astute Pricing By Sales Representatives Can Expand Profit
One surefire way to grow profit is to deploy sales resources that masterfully price your company’s products and services. The right price can boost profit more than improvements in the cost-of goods sold or reductions in SG&A. For example, a 1% improvement in price expands operating profit by about 12% whereas a 1% improvement in cost-of-goods sold (COGS) or selling, general and administrative expense (SG&A) only yields an operating increase of about 8% or lightly more than 2%, respectively. (1)
Inappropriate discounting dramatically shrinks profits. TopMark’s analysis revealed that price cuts of .5%, 1% and 3% reduced gross profit by about 2%, 3% and 10% respectively. (1)
Pricing discretion should be delegated to appropriately trained sales representatives who have demonstrated an ability to sell on total delivered value. That is, those who effectively appeal to customers’ needs for lowered product-life operating costs or other financial benefits. Under this sales approach, product price is a function of return on investment rather than a cost.
Selling on total delivered value requires sales representatives to know their customers’ businesses and profit making formulas. Supplementing this information should be a knowledge of: 1) customer-specific costs and price data (including won and loss quotes) and 2) competitors’ price levels and value propositions. Thus armed, sales representatives will be able to:
> Identify those customers whose business costs or profits can be improved significantly through the product/service solution they’re offering;
> Quote the best price indicated by the relationship between market prices, their current price positions
at the customer and the price targets management wants the sales representative to achieves; and;
> Avoid “leaving money on the table.”
Typically, different functions – each with their own buying criteria – have input into a purchasing decision. It is important, therefore, that a sales representative understand the buying criteria of each decision maker or influencer in order to tailor the extent a sales message emphasizes product performance and economics, warranty, parts availability, service, etc.
Finally, price acceptance is highly dependent upon how effectively a sales representative structures and communicates the deal. How a price is structured is as important as the price tag. Such off-invoice items as volume discounts, year-end rebates, payment terms, discounts and freight can influence the customer’s price perceptions.
(1) Results are based on TopMark’s analytical sampling of manufacturing-dominated, publicly-traded companies.
About the Author: John F. Tallitsch is the founder of TopMark, a consulting boutique specializing in sales effectiveness and sales compensation. TopMark helps companies create finely-tuned, results-oriented sales capabilities through solutions encompassing: customer segmentation and targeting; sales strategies; sales force and territory design; performance-driven sales incentives; and talent strategies. You can contact John at 440-963-1240 or visit http://www.top-mark.com for more information.
Source: www.isnare.com
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