Even in today’s economy, sales are able to create remarkably large profit gains by growing their profit core — in other words, selectively enhancing the profitability of their existing book of business. This has immense leverage.
In most companies, between 10 and 15% of the customers are responsible for generating 150 -200% of the reported profits. Interestingly enough, between 15 and 20% of the customers eat away at 50% or more of these profits. The lingering 65%-75% of the customers generate only minimal profits or losses. We call the:
- High-profit customers “profit peaks”,
- Large low-profit customers “profit drains”, and
- Small minimal-profit customers “profit deserts.”
This profit segmentation is the key to increasing your profit core as each segment needs a different growth game plan.
As there are so many moving components within an organisation, the sales management process needs to be fully grasped in order to ensure that each aspect of the joint sales effort is operating effectively. The primary focus of the sales managers should be to maximise profit for the team all while providing the very best value to customers.
What Is The Role Of The Sales Manager?
It is the job of the sales manager to:
- Develop a sales force,
- Coordinate sales operations, and
- Implement sales techniques that allow a business to constantly hit, and even exceed, its sales targets.
If your business takes in any revenue at all, a sales management strategy is an absolute necessity. When it comes to improving sales performance for any size of operation, no matter what the industry is, the secret to success is always accurate sales management processes.
Besides assisting your company reach its sales objectives, the sales management process gives you the opportunity to stay in touch with your industry as it grows. This can be the difference between surviving and flourishing in an ever more competitive marketplace.
If you’re an experienced or new sales manager, you should be able to assess and gain visibility into your current sales force. Once you have an unobstructed view of the processes that need to be monitored and how to keep up with them, you’ll be equipped to identify issues early on, coach team members before it is too late, and have a better overview of the tasks the team should be doing to increase its sales.