It’s the time of year when people think about goals. Business people discuss monthly, quarterly, and year-long goals for the coming New Year. Salespeople look at potential new business and outperforming last year’s numbers. But what are realistic sales goals?

I’ve said before You Cannot Do a Goal You Can Do Activities. To set a goal without recognizing the activities it will take to reach the goal is little more than a wish. One way to implement activities and set achievable sales goals is to Do the Math.

Sales has been called a numbers game. There’s a lot more to it than numbers, but the numbers are a key element. To set realistic goals the sales team needs to know the numbers.

Playing by the Numbers  

Setting achievable goals depends on understanding objective criteria. When setting yearly goals the numbers from the previous year should be the first thing reviewed. Once last year’s numbers have been analyzed the next step is to identify areas for improvement and recognize activities to implement for positive change . Let’s look at the numbers.

Total sales

What was the sales volume the previous year? Can it be repeated or improved upon and if so, what activities will get you there?

Number of calls to set a presentation

Whether your method is cold call, phone, or contacting online inquiries, how many calls did it take to set an appointment? Can the percentage be improved?

Number of presentations to close a sale

How many sales presentations did you need to close a sale? One out of three? Two out of ten? Regardless, use this information to predict how many presentations you’ll need to reach your sales goal.

What’s your average sale?

What was the average order last year? Was it $5,000 or $25,000, and can it be improved?

It’s Time to Calculate Your Goal

Once you have the numbers, you can do the math and calculate the number of calls you’ll need to make to hit your goal.

For example, with a Goal for the year of $500,000 in net sales, at an Average sale of $13,500, 37 sales will be needed to reach the goal of $500,000. At a Close percentage of 20% (2 out of ten presentations resulting in a sale) you’ll need 185 presentations to reach 37 sales.

If Presentations set per call are 10% (for every ten calls one presentation is set) you’ll need to make 1850 calls to set 185 presentations. With 260 working days on a five day work week, you’ll need to make 7.11 calls per day to hit the $500,000 goal.

Have you Calculated Your Goal?

Do you have sales goals for 2017? Do you know the numbers and how to get there or are your sales goals little more than a wish? I wish you well.