Formula for Government Sales Success Depends On Many Factors, But The Number of "Impressions" Each Week is The Manager's Key
Business owners are constantly challenged with the issue of what to expect from their government sales executives in terms of time management, goals and actual results. When I'm asked about how to set goals for a government sales team, my answer is always the same, "It depends."
The following are factors to be considered when making such decisions. In other words, "It depends"
...on the sales cycle in the commercial market place of your product/service.
...on whether you already have government business.
...on the experience and personal contacts of the sales executive.
...on whether you are on GSA schedule.
...on where your corporate office is located in regard to your potential clientele.
...on the dollar amount of the sale itself.
...on whether you sell a product or service.
...on your corporate reputation. Are you a name brand or are you a small unknown?
...on whether you are willing to invest in travel expenses in order to get your sales staff in front of the customer.
...on whether you are willing to create a name brand for your company.
...on whether you target your government market by assigning each sales executive a set number of target agencies (say, between 1 and 10) or assigning your sales executives to all government agencies and military bases in a specific region.
...on whether the sales executive is solely focused on obtaining government business.
...on your subcontracting opportunities.
...on the partnerships you have established with your friendly competitors or potential product bundlers who might want to include your product/service as part of their solutions.
As you can see, there are many factors which can affect the outcome of your success with the government. Therefore, you need to add or subtract some of these issues and weigh them based on your business. For example, if the sales executive is just out of college and has no contacts but plenty of high energy, you can start them out with a small base salary with a good-sized commission opportunity and let them hit the field. If the executive retired from the military after 30 years of service, he or she is going to expect some sort of generous base compensation with a great commission opportunity or some stock in the company. Keep in mind that the more experienced executive may have a great deal of embedded government contacts. Since there is an underlying government and military philosophy to "take care of their own," hiring someone with strong contacts could result in some sales within your first year.
When it comes to name brands, we know that the government is not supposed to single out name brands. However, government employees prefer to work with proven products and companies since the culture of their work environment is to avoid risk at all costs. If your company's name and products are not well known, it will take time to close business. In many instances, the government will give you a trial run or a "test" to see how you perform. After you establish yourself as a trusted vendor, the bigger opportunities will come your way. Therefore, it will take you a little more time than expected to get your first opportunity.
Here's how I set up my goals when I first hit the government field:
As the National Sales Manager for my business and facing a year of building a brand new market for my company, I looked at my annual salary and compensation plan and added in all of my travel time. I gave myself 12 months (as I was told was this is the average time it takes to make inroads into the federal market) to "pay for myself" in terms of closed business. Since I needed to visit seven territories throughout country every eight weeks, I came up with a weekly travel budget of approximately $1,000. My budget included hotel, airfare, and meals. I only needed a rental car if I didn't have a local sales executive to travel with me. On those occasions in which I traveled in Washington, DC, San Francisco or Chicago, I focused on downtown locations since I could reach those destinations by public transit.
During the first year, I was in the field or traveling from Monday to Thursday. I used my Fridays to follow up on the past week's open questions and closed appointments for the following week. When I was in the field, my goal was to book about 5 appointments a day and fill in the rest of the day with new introductions, networking luncheons with "partners" and cold calls. Once in a building or on a base in a booked appointment, I always had time to see two to five new people. In doing so, I quickly met 7-10 new contacts.
If I uncovered a true opportunity, I would jump all over it and work on that proposal first. If this meant rescheduling the other appointments, I did it. Potential clients actually appreciate someone who jumps at helping another client. Putting the customer first sets the tone that you are a go getter who puts pressing matters first. At times, I needed to book my Project Manager or a local Sales Executive to go on the proposal appointment with me to make sure that all of our company's local processes and procedures were followed. Bringing local sales persons along for appointments also helped train them and brought them up to speed in doing business with the government. A teamwork approach and the willingness to share successes with the local sales staff result in a good sales environment rather than one of competition and animosity.
After about eight months in the field and about four "rounds" to each territory, I was able to identify my true opportunities and key clients. Once I had established who these key clients were, my visits were much more welcome and the resulting conversations very informal and more personal. It takes time to get federal employees to open up to you and they need to get to know you on many levels before they will take a risk and actually give you an opportunity. But, if they see you face-to-face fairly regularly, or at least hear your voice once in a while, they will realize that you are in this business for the long haul.
What should you expect out of your sales executive? I believe that each "contact," whether it is made on a face-to-face basis, by email, or phone, creates an "impression." That "impression" could be negative or positive and can change based on the mood, the situation and the contact's needs. In general, I believe that sales executives need to make at least 100 good "impressions" per week. Using a benchmark of 5 appointments a day for a four-day week spent in the field, you would have 20 face-to-face impressions by the end of the week. The rest of the time must be spent doing the following: responding to client questions, preparing quotations, following up with clients, preparing mailings and email blitzes, checking in with personal email contacts, face-to-face cold calls, telemarketing, attending networking events and partnership luncheons, and setting the next week's appointments. That's another 80 impressions throughout the week.
You will need to modify this formula a little bit based on the location of your business and the amount of time your sales executive truly spends on building government business. A great way to get the conversation started with your sales executive is to ask them for their personal "impression" and "appointment" goals each week. Once a month, sit down with that sales executive and go over their ACT or Goldmine Database with them to see if they've met their personal set goals. Compare their goals with actual business and see if you need to adjust that goal. Remember, sales is a numbers game.
Here is my little formula:
Dollar Amount of Sales Divided by Number of Impressions = X per impression. Raise the number of impressions and your dollar amount raises. Add sales people to the formula and your sales multiply.
Here are some examples:
($1,000 in Business/100 Impressions) = $10 per Impression x (6 Sales People x 100 Impressions) = $6,000 in Business.
($500,000 in Business/100 Impressions) = $5,000 per Impression x (10 Sales People x 100 Impressions) = $3,000,000 In Business
Sales managers or business owners new to the government market must remember that the government sale is one based on a strong relationship with the client. Building these relationships takes time. Therefore, you need to expect to invest in this time to nurture the first level sales. Eventually, this uphill battle will snowball into some huge opportunities. I'm hoping that you and your team have the strength to work uphill for a while. The opportunities on the other side are well worth it.
As you may recall, my sales goal for my first year was to uncover enough business to pay for my salary and my travel. My actual results exceeded my goal by ten times.
Good luck, good selling! If I can do it, anyone can do it.
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