Missed sales targets can sink a company's strategic plan before it has a chance to take off. Lagging sales decrease revenues and lower profit forecasts, which means businesses have to cut costs somewhere until sales pick up in the future. Despite common convention, a bad sales team is not always to blame for poor sales.
A study published in 2016 states only 45.4 percent of salespeople miss their quotas, while 54 percent achieve just enough revenue to meet exact quotas. Indeed it seems the sales staff is the cause of missed sales targets in almost half of all cases. However, business leaders should not jump to conclusions. Some instances require further investigation beyond the sales team, which is where a smart manager comes into play.
1. Technology Hiccups
The sales staff sometimes do not realize that the products and services offered by the company are not compatible with the customer's system. The customer could have forgotten to test his system with the new platform offered by the team. A missed sales target happens when a customer does not perform due diligence before making a hasty purchase. This leads to retooling the product for months, which wastes time and effort.
Similarly, sales technology is not always able to compete. Teams need on-the-go advice, updated metrics and sales tools in the office, at demonstrations and in the field so they can do their jobs. Without the right investments in sales technology, teams underperform. This blame rests with upper management and budgeting.
2. Production Problems
Missed sales targets are not sure indicators of a bad sales force at all. If the manufacturing side of the process cannot keep up with the sales forecasts, the company has to scale back its production numbers. The sales numbers are great, but the manufacturing side of things is not keeping up.
3. Production Shipments
If a part doesn't arrive as scheduled from another client, the supply side throws everything off and delays shipment of the finished product. Supply chains must remain intact and ready to go for big orders. In this case, missed sales targets aren't the fault of salespeople since a valued supplier dropped the ball after someone placed an order.
4. Deadlines
Following up after the sale is crucial to make sure quotes are turned in on time. If salespeople promise a two-week turnaround on a quote and the customer service staff can't deliver on time, the potential sale is lost if the client moves on to another offer.
5. Holidays
Some suppliers and shipping companies, especially in foreign countries, go on holidays at different times. This causes a lack of shipping or manufacturing, which also leads to delays and missed opportunities.
6. Internal Strife
Something as petty as office politics could get in the way of sales targets. Companies could lose very large orders and very wealthy clients if two departments cannot agree on pricing, delivery times or staffing levels. The added stress leads to arguments, lost revenue and lower sales, as no one is giving the client a definitive answer.
Missed sales targets happen for several reasons, some of which don't fall on the sales force. Managers and leaders should do their homework to determine a cause before making the hasty decision to cut valuable salespeople from their team.
Photo courtesy of greg at Flickr.com
Become a member to take advantage of more features, like commenting and voting.
Register or sign in today!