Gambling or Selling?

This guest post on our blog is by Chip Doyle a Sandler Training lecturer, Coach and franchise owner. See his bio below the article.

 

Gambling or Selling?

Gambling or Selling?I just returned from Las Vegas where I was speaking over two days to business owners in the construction business.  I admit I do get excited about wagering, especially in Las Vegas but I realized how I was getting suckered in when a slot machine caught my eye. It said “99% payout guaranteed”. Understand, that is supposed to be a good thing… You essentially put in $100 and over time, you will get $99 back… When you aren’t emotionally involved, it’s easy to see the futility of gambling in Las Vegas. But the lights and the bells and the buzz of excitement reels you in and sure enough I donated $60 to a resort over about an hour.

And this is precisely what happens to salespeople and sales managers. They get reeled into the excitement of chasing a deal. The prospect says they are interested and our quote looks good and they will be buying 10 times more in the future and the competition is sharpening their pencil too and if it was up to them, they’d go with us and… It’s the equivalent of bells, lights and the buzz of excitement at the casino. The salesperson gets suckered in and chases opportunities that they have no chance of winning.

Second Place is Horrible

Every poker player knows that the worst place to come in at the poker table is SECOND. That’s the player that bets (and loses) the most. The good poker players are happy to win but they know their advantage over the opponents is their skill to fold early and avoid the deadly position of second. This applies perfectly to salespeople. They should identify lots of opportunities but they shouldn’t bet heavily on every single one! I realized salespeople don’t understand this concept when a client of mine shared proudly that they didn’t win the business but they did come in 2nd place. This client spends tens of thousands of dollars on estimates. Second place is the worst possible outcome! Even if a salesperson’s proposals cost pennies, there still is the opportunity cost of chasing deals that will never close when they could have been prospecting and identifying much better deals.

Sales managers fall into a similar trap when hiring and managing salespeople. The excitement of a new salesperson that could close millions in new business blinds their judgment. “They seem to know how to sell” the sales manager says, and so they let the salesperson try to figure things out on their own. “Chip, I don’t want to micro-manage them.” That’s like saying “Let it ride” at the betting tables except your odds are more like 9%, not 99%. Instead, managers should establish benchmarks that the salesperson can achieve early. If the salesperson is incapable in the short term, the manager can cut ties and save wasted salaries and stomach acid later.

Why Sales Managers Fail: They

  1. Don’t know what activities and strategies a salesperson needs to do on a weekly or monthly basis to meet goals and wait months or years for revenue that never materializes
  2. Do not insure their people are doing the weekly/monthly activities and strategies
  3. Fail to coach people to achieve the necessary results (assuming they are doing the activities and understand the strategies)
  4. Keep the wrong salespeople on their team and fail to recognize the good ones because they don’t do 1-3

The reason I’m passionate about my business is #4. It drives me nuts to see a salesperson let go when it was the manager’s fault. It also makes me crazy to see a salesperson make empty promises about future revenue while milking the company’s payroll for as long as possible.

Please don’t gamble with your sales department. Change the way you qualify proposals and stop rolling the dice with your salespeople.

 

Sales Manager Power Meeting – Attend this comprehensive session for sales managers in the construction, remodeling or home improvement industries. Bring one of your salespeople or your office manager to help you implement these systems and techniques and take advantage of a 67% discount for their attendance.

Author Bio:

Chip Doyle (BSEE-University of Texas, MBA- University of Chicago) made the difficult transition from engineer to successful salesperson in 1988 – conducting sales calls in 14 countries. Since his Sandler Training franchise opened in 2000, Chip has shared techniques and innovative methods that allow salespeople, consultants and contractors to take charge of the selling situation and “sell without sounding like a salesperson.”

Chip’s dynamic and entertaining style makes him a welcome speaker at dozens of trade associations and business groups each year. He has conducted well over 1000 private and public workshops since 2000 on a variety of sales related topics impacting the success of CEO’s, business owners, sales managers, estimators, consultants and salespeople throughout the US. Chip has been featured in the San Francisco Business Times, quoted in national publications such as Remodeling magazine and Forbes and conducts train-the-trainer sessions at Sandler’s International Conferences.