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My simple formula to reach your sales targets in 2022
It’s almost the end of February and most of you should have received your targets for the month/quarter/year. No matter if you’re an SDR, an AE, or managing a team of reps, it’s always a good idea to have a clear, actionable plan to reach your targets.
In this quick article, I’m going to show how to build that plan, step-by-step. Our goal is to find how many initial prospect meeting we need to run, assuming we have zero pipeline.
1. Set a yearly/quarterly/monthly goal
The first step is really simple. Just go and find out how much you’re supposed to close, or how many meetings/opportunities you’re supposed to generate. If you’re an AE, you’ll most likely have a yearly target, divided in quarters or months. If you’re an SDR, your targets will most likely me quarterly or monthly.
When you know your big number, divid it to match it with the period you’re evaluated on. For example, a €1.000.000 yearly target, evaluated quarterly = €250.000.
2. Set your average deal size and find out how many deals you need to close
If you’re new to the job, go check your CRM to find out the average deal size of your colleagues. If you have some experience already, use historical data, or known assumptions based on the pricing of your solution.
In our example above, €25.000 average deal size -> 10 deals to close per quarter, 40 for the year.
3. Understand your sales process stages
Very important step. You’re sales process is the way you turn a stranger into a customer. It can vary from business to business, but we typically see 5 stages, from discovery call to closing.
Here’s my sales process (feel free to copy):
- Stage 1: Interest – Discovery
- Stage 2: Education – Demo
- Stage 3: Validation – Contract Review
- Stage 4: Justification – Negotiation
- Stage 5: Decision – Closed Won
4. Define a conversion rate for each stage
Now that you have clear idea of your sales process, define the conversion rate from one stage to the other.
Here’s what I see in my process:
- Stage 1 to 2: 50%
- Stage 2 to 3: 60%
- Stage 3 to 4: 70%
- Stage 4 to 5: 90%
5. Find out how many discovery calls you need to set
Finally, start from the final goal and use your assumptions to define how many stage 1 opportunities are necessary to reach your goal.
In my example:
- 10 stage 5 opportunities at €25.000 per quarter closed equals:
- 12 stage 4 opportunities
- 18 stage 3 opportunities
- 30 stage 2 opportunities
- 60 stage 1 opportunities
60 discovery calls per quarter = 5 per week. If you’re already running 5+ discovery calls per week, you’re on track. If you’re under 5 discovery calls per week, you need to find more through outbound, or increase your average deal size.
Follow these 5 steps and you’ll get a general idea of the prospecting effort you need to deliver on a weekly basis. If you need to be spending more than half of your day running discovery calls, your plan will be hard to reach with the assumptions you have.
And if you’re interested in finding out how many prospects you need to contact every day, I suggest using my “Cruising Altitude Calculator”. It’s part of the New Outreach System and you’ll calculate the exact number of prospects you need to find and contact every day. You’ll also learn how to build an outbound sequence, what to say in each touchpoint, and how to build your prospecting routine.
Grab it today for €79 instead of €149 with the code “week7email”.
→Work 1:1 with me: If you need help booking more meetings, I can help you. We’ll go through your current situation and what’s not working. We’ll build an action plan to land you more meetings and more money in your pocket. Book me here.