Research from worldwide authorities on sales and sales management provide a sobering perspective on the health of our sales processes.
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"The cost of retention is $180 per customer, but most companies are set up for customer acquisition - which is
crazy when you consider the average cost of customer acquisition is
$1,000 or more."
- "Companies can boost profits by almost 100 percent by retaining just five percent more of their customers,"
- "15% of customers defect due to technical quality reasons; a further 15%
leave because of price and the remaining 70% leave because contact from
the old suppliers personnel was "poor in quality".
- "80% of all sales are made on the 5th - 12th contact. 15 years ago it took on average just 2 - 4 contacts before concluding a sale.
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"Average time a sales representative spends on sales: 47%. (Some studies put it as low as 10%) - On administrative tasks: 39%"
Most accept that sales can be substantially improved and forecasts more predictable when salespeople have access to good customer data and better time management.
A 'Customer Relationship Management' System (CRM), is becoming the method of choice for salespeople worldwide, in all industries. They're reaping the benefits every day, better managing themselves and their customer base....
Yes, it's software, but don't confuse CRM with our Quoting or Accounts packages. (Only the more expensive MIS systems like Prism offer CRM capabilities). But mainstream CRM tools are extremely affordable today, managing selling tasks, time management and customer service - To see where CRM fits and the differences let's look at the main viewscreen of a typical CRM system:
Obviously, this tool is specifically for salespeople and their managers, certainly not estimators, production people, warehouse or accounts staff! It is there to help salespeople better manage their time, accounts and resources. Note the Pipeline graph, being one of a dozen reporting tools included. Very sales-focused.
The cost for this type of multiuser software starts from around $4,000 plus training. But like all systems, it's only as good as the data fed into it. Proper setup and ensuring all staff use it with gusto is the secret. Once running, it really saves salespeople a lot of time plus ensures managers know what's happening.
Considering the widespread inefficiencies mentioned at the beginning of this article, payback could be measured months, not years.
Solving Business Security Concerns
Perhaps the bigger, little-mentioned reason for introducing a central computerised sales management system like CRM is the added security it brings.
Salespeople like to keep things in their head. Knowledge is power and
all that. However this doesn't help company owners who have the added
concern that when salespeople leave, they may take customers with
them, since they have all the records and often, copies of quotes.
Having sales activities in one central system and not stored on
individual PCs helps reduce these risks.
Like company-wide MIS systems, all CRM sales data becomes company property and is less easily stolen or used inappropriately. It's there to benefit the company, not just individuals. As such it actually adds to the company's value, especially when the business is offered up for sale.
As an industry, should we consider better tools like this for our salespeople? What do we invest in sales training? Is security an issue for you? The answers tell us what value we place on sales and our salespeople. For more information of CRM email:
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