Maximizing profits and minimizing costs is constantly on the mind of any executive, but it is a give and take, and you may feel as though you have to choose one over the other. However, that doesn't have to be the case.
Here are seven 7 ways to reduce the cost of sales, without reducing revenue:
1. Examine each customer's profile. Note their profit margin and whether they and their industries are growing. Determine what is specifically needed to service each one. Do not follow traditional practice, such as assuming that big customers want big support. With a better understanding of customers, sales resources can be focused more appropriately, thereby increasing value while cutting cost.
2. Create a sales-process model based on, for instance, a customer's company size and industry, sales volume, and buying history. Through ranking customers by opportunity, this model increases the efficiency of both the sales process and your reps. An added benefit: the model provides reps with timely reports, focusing them on products most apt to be purchased.
3. Improve the productivity of low performers. Share best practices. Clone top reps to help get low performers to better focus on core-customer accounts. Encourage team building and peer accountability, so top reps encourage low performers.
4. Improve after-the-sale customer service with a Customer Relationship Management (CRM) program. A CRM not only improves the quality of customer service and increases customer satisfaction and retention, but also relieves reps of nonproductive, non-selling tasks, such as correcting mistakes. Be sure a CRM system is up-to-date and is fully utilized by everyone involved in sales, marketing, and customer service.
5. More closely integrate marketing with sales. With highly focused, content-oriented, targeted marketing, some in-person sales calls can be easily and more effectively replaced. For example, within a sales process, integrate proven lower cost-per-contact marketing tactics, such as direct mail, email, case studies, RSS feeds from your blog, social media, or even highly targeted pay-per-click advertising.
6. Use call planning and mapping to increase the number of face-to-face calls made per day or per trip. When combined with a CRM system, this combo provides visualization of data that often lies hidden in spreadsheets, turning raw data into knowledge and profits. Benefits for sales include balancing territories, finding missed sales opportunities, and making better decisions for spending limited sales time more effectively and economically.
7. Expand sales territories. Perhaps, as a last resort, lay off one rep and ask others to cover his or her territory. This is generally better than cutting everyone's pay. Important to the success of this territory realignment is getting input and buy-in from reps. They must have ownership of this cost-cutting solution and accept the downside, as well as profit from the upside.
Learn more about InfoGrow at www.InfoGrowCorp.com, or call Bob: 800-897-9807, x224.