Your own sales plan

At the start of the year you are assigned a sales target. You got to put all your efforts in obtaining that figure. At first you seem to have a whole year to reach it, but if you don't organize and plan your work, you'll probably regret at year end.

That organization is what I call the sales plan. The sales plan is NOT just for business or sales departments; the concept also applies to the professional responsible to make the sales.

What we will look with the sales plan is to determine the number of activities / tasks to do each day / week / month to achieve the objective. As it is impossible to know to whom, what and when we are to going to sell, we will use statistics to measure our daily activity and have a scale that allows us to know how we're doing and if we need to assign more time to some activities and less to others.

The first thing you do is translate that economic data into something that allows you to organize the activities necessary to reach the goal. What is the average price of a sale of your products / services? If the prices of the "projects" can vary greatly, you could create categories of projects, including: large, medium and small. Then you'd have to answer another question: "What is the ratio of sales between the different categories?" and "What is the average price of projects in each category?"

Say, as an example, the ratio of the categories is: 60% of the projects are small projects with a value of 1.000, 30% are medium projects having a value of 5,000 and 10% are large projects with a value of 20,000.

Now we calculate a weighted average price to obtain the mix price of your projects. The method of calculating the weighted average is: 60% x 1000 + 30% x 5000 + 10% x 20000 = 600 + 1500 + 2000 = 4,100.

This means that the projects mix price is 4,100.

The next step is to determine the amount of sales you have to do. If your goal is 100,000, then divide that aim between the price mix, i.e. 100,000 / 4,100 = 24.39. In other words, this year you would have to make 25 sales to reach our goal. If statistics are true, you should make about 15 (60% of 25) small sales, 7.5 (30%) average sales and 2.5 (10%) big sales.

If we do a simple calculation without taking into account seasonality, we have that would require a little more than 2 sales per month, or a little over 6 quarterly sales.

Excellent, you already have an initial idea of the magnitude of the work you'll need to do. At this time, you know that at mid year you must have 6 sales. If that is not the case, you should analyze very closely what you have been doing and determine the changes needed to improve your performance.

Now let's try to identify the number of tasks that you will need to do to reach that number of sales. For that we need to work with the sales process: what are the activities that comprise it? Let's use a simple process:

The first step of the process is making cold calls. Once you contact the person you will request a meeting to present the product and make them to ask for the offer. The third step is to present the offer and close the sale. For each of these activities is necessary to determine your success ratios. In other words, how many calls you have to do to get a meeting? How many customers you have to visit to get one who asks you for anoffer? How many deals have to be present for a sale? Again, this sales process is very simple, but it is just an example.

To keep the model simple, we assume that success ratios are the same for all three categories (large projects, medium and small) we have identified.

The table below illustrates the information discussed in the preceding paragraphs, including the likelihood of success for each phase. Those odds of success are specific to each vendor and product. The values that I placed in the table are invented and should not be taken as a reference:

Step	Success fact	Prob.	Comments
Cold call	Set meeting	25%	One in 4 calls you succeed
Meeting	Ask for a Offer	50%	One out of 2 asked for an offer
Submit Offer	Accept the offer	80%	Four out of 5 offers are accepted.
Sale made

The next step is to calculate, starting from the last step, the amount of activities necessary for achieving the target, i.e. 25 sales. The reasoning is this: If I have to achieve 4 to 5 offers sales (80%), how I do to get 25 sales?, The result is 31.25. This result is rounded up, giving 32. In other words, To make 25 sales at year end, it is necessary to submit 32 offers.

Follow this reasoning to the rest of the activities and get a table as follows:

Step	Success	Prob.	Qty.
Cold call	Set meeting	25%	214
Meeting	Ask for a Offer	50%	64
Submit Offer	Accept the offer	60%	32
Sale made			25

You now have a guide to measure the amount of activities you do to achieve your annual goal.

Now it is time to take those amounts to a timeline. To keep the model simple, I will not consider seasonality, i.e. taking into account that the level of activity is not the same in all months. For this example assume that we work all year and all months are equal. For example, also assume that all months are 4 weeks.

How long may take each phase? Let's say the entire process of selling, on average, takes 2 months, which requires 1 week reaching a meeting, 3 weeks to be asked for the offer and 4 weeks to get signed.

This means that of the 12 months of the year, we need to make the 214 calls in 10 months, since the processes that are started from that time can not be closed within the year (remember that the sales process requires 2 months). So every month we must do 22 (21.4) calls.

Similarly we continue with other activities: the deadline for the 64 meetings is 10 months + a week, and to present the 32 deals in 11 months. The result is the following:

Step	Success	Prob.	Qty.	Dur.	Deadline	Monthly
Cold call	Set meeting	25%	214	1	10 months	22 (21.4)
Meeting	We offer claims	50%	64	3	10m +1 s	7 (6.2)
Submit Offer	Accept the offer	60%	32	4	11m	3 (2.9)
Sale made			25	8	12m

This chart is telling you that if you want to reach your goal, you must perform 22 calls a month (once daily) and achieve 7 meetings per month (plus or minus 2 per week) and close 3 offers a month. These are your short term goals.

Perfect! You can organize, from you first day, to achieve your goal. I recommend you do all these calculations with a Spreadsheet, so you can make the necessary adjustments based on your actual experience, for example: changing your odds of success and the times, if you find out that the initial ones are not valid.

With a little common sense you can adjust the model to take into account the level of activities of each month, include your vacation and even you may work with eleven month, instead of 12, providing a cushion of emergency.

There is only one more thing to do: implement it.

Good luck.