10 Ways to Validate a Sales Forecast

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Even without data, there are other ways to test your projections.

By Tim Berry

You have an interesting new business and you’re working your plan, thinking about seeking investors when you come to the sales forecast. How do you validate a sales forecast when you’re talking about something new? Of course there’s no data. So now what?

I’ve been on both sides of the table on this one–as an entrepreneur, seeking investment and an angel investor and as a business plan contest judge, evaluating new business plans. I’ve also spent a lot of years in the middle–as consultant to investors and as consultant or co-founder for the entrepreneurs. Given that background, here are some thoughts that might help you validate sales.

  1. Sales are the best validation by far. Real, actual sales, even if they’re just a single involved customer, or a small account. Sales means people or companies are spending money to buy what you’re selling. That’s light years ahead of blank projections.
  2. A buy-in by a potential large customer or distribution channel is also a good validation. Getting them involved with a prototype, beta program, or early investment is great.
  3. Overall market demographics. How many of your potential customers (the more carefully defined, the better) are there? How do they divide into meaningful measurable groups. This injects reality into your forecast. Know the top numbers in the market.
  4. Avoid the small-piece-of-a-huge-market gambit. This is the top-down forecast that starts with how much money is spent on say, home entertainment, then projects your business will get some tiny piece; like half a percent. That is never convincing. Don’t do it. It’s deadly.
  5. Break a forecast down into pieces. Divide and conquer. For example, if you’re forecasting a web application, show it as a function of projected inbound traffic, clicks from paid search and visitors from organic search, then conversions, subscriptions, renewals and attrition. Granularity makes a forecast feel more solid. As another example, if you’re forecasting a restaurant business, break it down into chairs and tables and meals served, drinks, dinners, lunches, by day of the week and, at least as a sample point, hours of the day.
  6. Always acknowledge capacity issues. The restaurant has chairs and tables, and the web application has bandwidth and users. Don’t ever get caught forecasting beyond capacity.
  7. Look for patterns from other situations, similar products or business offerings, similar markets. There are introduction patterns available for televisions, color televisions, personal computers, faxes, cellphones, etc. Is your business going to be like any of them?
  8. Never pretend there won’t be competition, even for the newest of the new. If you can’t find anybody competing already where you want to go, look harder. Look for how people are already solving the need. Before I did the early business plan templates I started publishing in 1984, there was nobody else in the market but I was competing with books, classes, and magazine articles. I could also anticipate that if my stuff caught on, others would appear in the same market.
  9. Distrust the data analysis. I had great success once with an epidemiology model, predicting penetration of personal computers in Latin America would behave like the spread of disease; one user infecting others, with different economic strata having different propensity for infection. But even that, and most of the mathematical analytical methods, are always subject to the problem of using the past to predict the future. They’re good as background, to temper your thinking and educate your guessing. But they don’t stand alone very well. Do all the analysis, get as much data as you can, but be realistic. The best forecast is a well educated guess.
  10. Review and revise forecasts frequently. Write down your assumptions and track how they’ve changed over time. Your forecast is just the first step in a process.

 

 

STARTUP SALES GROWTH: SIX TIPS FOR A BIGGER 2013

By Matt HeinzSJ Daily Blog Pix

Most sales teams are busy right now finishing the last month and quarter of their year, which means they’ll hit January 2nd by hitting the reset button but behind when it comes to strategically preparing for improvements in the New Year.

There’s no excuse for taking your eye off the ball before December 31st, but here are six specific focus areas to ensure 2013 not only gets off to the right start, but improves upon the results and momentum you may have built leaving the past fiscal month, quarter and year.

1. REVIEW 2012′S LESSONS & IMPLICATIONS

Do a quick post-mortem on the year. What went well? What would you have done differently? What should you have anticipated, and what do all of those lessons & observations tell you about how to prepare for and execute in the New Year? Pull your sales managers and a few key reps into a room (for lunch or beers if you don’t want to disrupt selling hours), or at minimum lock yourself in a room for a couple hours for reflection.

Do this right, and it’ll be difficult not to come up with insights and ideas you can use to put your team on a better track in January.

2. SET CLEAR GOALS (BUT BE REALISTIC)

What does success look like? What top-line sales numbers are you expected to hit, sure, but how will you get there? What’s your target cost per new customer acquisition, for example? How will you define and measure sales team productivity and satisfaction?

You can make a spreadsheet say anything, and no sales leader is solely responsible for coming up with sales goals. But as you work with your management peers, ensure sales goals are aggressive but based in realistic expectations.

3. INVENTORY AND SECURE THE RESOURCES YOU NEED

So, about that sales number you’re expected to hit. Do you have enough reps? Do they have the tools they need? What’s required from your marketing team (in terms of leads, tools, training, market intelligence, etc.) to succeed?

This isn’t about setting up excuses and scapegoats when your numbers don’t reflect expectations at the end of January, but rather ensuring there’s forethought into how you’ll execute.

4. PLAN AND EXECUTE A KICK-ASS SALES YEAR KICK-OFF MEETING

In some organizations, the beginning-of-year sales kick-off meeting is a dying breed. But take a closer look at the most consistently successful sales teams across industries and you’ll find a dedication and focus to starting the year with everyone on the same page.

Get other executives involved, mix in plenty of training and role-playing, and ensure there’s also time for the team to gel, get to know each other, and have a little fun. Here are several additional best practices for your2013 sales kick-off meeting.

5. RESERVE TIME THROUGHOUT THE YEAR FOR TRAINING & REINFORCEMENT

Successful sales managers know that training isn’t a one-and-done exercise. It’s not something reserved for the annual kick-off meeting. It’s a weekly if not daily discipline and practice. It’s done both formally and informally across the sales floor.

Good training is constantly revisited and reinforced. It’s celebrated and rewarded. It’s a requirement if you want your team at the top of their game, especially when the rest of your market and selling conditions are constantly changing.

6. DEDICATE TIME FOR REGULAR REVIEW & OPTIMIZATION

Don’t want until this time next year to reflect on what’s working and not working. Take time – on your own and with your managers – to review your metrics as well as the “soft” factors impacting sales performance and results. Take input from customers, prospects, competitors and those from other departments to constantly adjust strategies and tactics.

These tips are easier said than done, but talk to successful sales managers and learn more about their they’re second-nature habits. Worth considering and incorporating as the clock ticks closer to 2013.

Matt Heinz is the President of Heinz Marketing and the author of the books Sales for Startups and Successful Social Selling.

 

How Much is Every Hour of Your Day Worth?

The Brooks Group SJ Daily Blog Pix

Everybody says “time is money”, but how many people actually live as if time was money?

In Las Vegas, they take away your “real money” and give you brightly colored chips to “play with.” This is not a caprice on the casino operators part; it’s done for a very sound psychological reason. People tend to risk more, lose more and lose more cheerfully when operating with this play money than with the form of money they deal with in everyday life.

Similarly, because minutes, quarter hours, half hours, hours and days are not dispensed in the form of money – coins and bills – it’s hard for us to feel the same way about spending time as we do spending money. The same person who gets confused in a dark cocktail lounge and leaves a $50-bill as a tip when they meant to leave a $5-bill, and feels awful about doing so, will think nothing about wasting an hour waiting in line or “shooting the bull” around the water cooler.

However, the fact is that time IS money. When you waste an hour, you might as well go to the ATM machine, pull money out and then toss it directly into the little trash bin beside the cash machine with the receipt.

There is absolutely no doubt that an individual’s income, career progress and other rewards are directly related to how much value they place on their time.

Below is a calculation device that will show you exactly how much money your time is worth.

These calculations are based on 8-hour workdays:

 

(NO COMMA – Example 52000)

IF YOU
WILL EARN $XXX,XXX/year
EVERY HOUR IS WORTH
EVERY MINUTE IS WORTH
AN HOUR A DAY
WASTED AWAY COSTS YOU – IN A YEAR
(Enter value here)

 

Did you plug in your numbers? Assuming you did, maybe the question now should be, how much time can you afford to waste?

The difficulty with time is that you can’t really save or salvage it. Time is an elusive ghost. Unfortunately you can’t bottle it up and store it in your basement for future use.

The good news is you’re not the only person who can’t store time on tap in their basement. The whole world is constantly being forced to shift and change with time.

Time is the ultimate equalizer. Time truly does “level the playing field” and that can be a remarkable advantage for anyone who is able to perceive time as their ally and learn to use it effectively.

You can achieve endless levels of success simply by mastering the ability to manage and prioritize your time. But before you can truly master time management you must identify and pinpoint the real time wasters in your life.

To help you identify where most of your time is being spent we’ve put together a time use quiz. It will help you to identify time wasters in your life and could possibly shift your perception of time.

Sales Advice: Two Choices for a Successful Career

By Michael Pedone  SJ Daily Blog Pix

When we are unwilling to make excuses or place blame we have taken a powerful and necessary step to defining and achieving our success. 



“What’s the BEST Sales Advice You’ve Ever Received?”

 

Answer:

The best sales advice I’ve ever received is:

“Learn from those who’ve already accomplished what it is that you are after”

One of my first sales jobs, I was hired along with 15 or so other “sales reps” that all had various lengths of experience. Several of them were “in the game” for a long time and others were brand new, just like me.

During orientation, the company brought in some of their top sales performers to share their knowledge on what to do to be successful at this particular job / company.

It didn’t take long before a couple of those who were in my group to start denouncing or challenging the sales advice of those who were already at the top (ironically, those with the “most experience” in my group seemed to usually be the ones who complained the most and said the top performers advice was all wrong)

Before you knew it, those “naysayers” were looking for another job, and spewing excuses and placing blame everywhere but themselves while on their way out the door.

WE ALL HAVE TWO CHOICES

When sales don’t happen fast enough, it gets real easy to start making excuses. And that’s a road to disaster.

We all have two choices:

1.  Take ownership and do what it takes to become successful. Or…
2.  Blame the leads, the manager, the company, the economy etc.

When we are unwilling to make excuses or place blame we have taken a powerful and necessary step to defining and achieving our success. Do the opposite and you get the alternative results as well.

Learning from those who’ve already achieved what it is that you are after yields far better results than does listening to the advice of someone who hasn’t.

I don’t remember who it was that shared this advice to me, but I do remember how easy it was to “buy in” to the advice of those who weren’t being successful and how their “excuses” for failure made “so much sense”, that they had to be right!

But somewhere along the (very fortunate) way for me, the light bulb went on and I realized there are two sides of the coin… And when I rejected the excuses, and sought after and hung on to every word of those who were already living the lifestyle I wanted, only then did things truly start to turn around. And Fast!

How to Say “Happy Holidays” in 18 Different Languages

SJ Daily Blog Pix

By Sabah Karimi

Want to do something different for the holidays this year? Send some holiday greetings to friends, neighbors, coworkers and family members in a different language!

Even though ‘Merry Christmas’ and ‘Season’s Greetings’ are much more common outside of the U.S. than ‘Happy Holidays’ (especially in Western Europe), you can still greet the rest of the world in true American style with some simple translations.

Whether you’re heading off on a round of Christmas caroling or writing up holiday cards for friends and family, share your global holiday spirit by saying ‘Happy Holidays’ in any of the following languages:

Say Happy Holidays! In French: Joyeuses Fêtes!

Say Happy Holidays! In Spanish: Felices Fiestas!

Say Happy Holidays! In Swedish: Trevlig Helg!

Say Happy Holidays! In Portuguese: Boas Festas!

Say Happy Holidays! In Turkish: Mutlu Bayramlar!

Say Happy Holidays! In Romanian: Sarbatori Fericite!

Say Happy Holidays! In Mandarin: Jie Ri Yu Kuai

Say Happy Holidays! In Catalan: Bones Festes!

Say Happy Holidays! In Japanese: Tanoshii kurisumasu wo! (Have a happy Christmas)

Say Happy Holidays! In Italian: Buone Feste!

Say Happy Holidays! In South African (Xhose): Ii holide eximnandi

Say Happy Holidays! In German: Forhe Feiertage

Say Happy Holidays! In Dutch: Prettige feestdagen

Say Happy Holidays! In Hawaiian: Hau’oli Lanui (pronounced how-oh-lay la-new-ee)

Say Happy Holidays! In Gaelic: Beannachtaí na Féile

Say Happy Holidays! In Slovenian: Vesele Praznike

Say Happy Holidays! In Indonesian: Selamat Hari Raya!

Say Happy Holidays! In Croatian: Sretni praznici!

Saying Happy Holidays in different languages isn’t always easy because the English word ‘holiday’ has a literal translation of a vacation or day off in most parts of the world. It’s also important to note that many countries celebrate the holidays right on through Epiphany on January 6, so you can get away with saying or sending holiday greetings for a few days after the calendar New Year.

If you’re traveling abroad, greeting someone with the literal translation of a holiday may get you some puzzled looks, and in some cases, it’s safe enough to say Happy New Year or Merry Christmas to honor the season. However, you can still learn how other cultures talk about parties or religious events, you’ll be much closer to the actual translation of the ‘holiday season’ when greeting your friends, neighbors and family members this year.

Spread some holiday cheer and surprise a few people on your holiday gift card list or party by greeting them in any of the languages above!

How To Stay Motivated & Stress Free During The Holidays

By Lisa Barone SJ Daily Blog Pix

Everything gets a little busier during the holidays. There are parties to attend, things to bake, decorations to put up, and family to deal with lovingly enjoy. Don’t get me wrong, it’s my most favorite time of the year, but it’s also really easy to let productivity fall to the wayside in lieu of more fun winter activities. Even if you’re feeling a bit like playing hooky in the snow, you want to make sure you head into the New Year as productive and motivated as possible. Below you’ll find tips that have allowed me to stay motivated during the holiday season. Of course, I’d love it if you’d share what’s worked for you.

1. Plan Ahead

Be realistic about your time. If you know you’re going to be traveling or skipping out early, schedule those as days off. Don’t assume that you’ll be able to work from the train the same you can from your office or that you’ll be able to find a quiet spot to focus when your house is filled with family. You can’t. Before things get too crazy, take a look at your calendar and decide when it’s realistic to schedule work time and when you should admit you’ll need the day off. If you work those days in now, you’ll be able to plan for them so you don’t fall behind.

2. Keep To Your Schedule

Do your best to stick to your regular work schedule as much as you can. While sometimes the holidays make it hard, you’ll find that if you’re getting into the office at the same time and keeping with that routine, you’ll have an easier time staying on task and getting things done. The more you play with your schedule and attempt to work from non-work locations, the more difficult it’s going to be to remain focused. Routines work for a reason – they keep us on the right path.

3. Create Rewards

I don’t know about you, but I’m a little competitive. Okay, I’m a lot competitive. To help me stay motivated and on target I like to create rewards for myself. For example, I’ll give myself an afternoon off if I’ve reached a certain point in my workload by X time. Or I’ll treat myself to pumpkin pie if I can knock out two great blog posts in an afternoon. The best idea for my waistline? Not in the least. But I’m not embarrassed to admit it works for me. Find what works for you – maybe it’s time off, maybe it’s your own guilty pleasure, or maybe it’s a new book (or outfit) you allow yourself to buy. Find your own motivators and use them to create rewards.

4. Alter Expectations

It’s unlikely that you’ll be able to get to the same amount of work over the next weeks that you normally do. To keep your sanity, you may need to cut back. Lighten your load by pinpointing what’s most important and what can be put off until after the New Year when your schedule goes back to normal. By being realistic about your expectations, you help avoid stressors before they have time to become stressors. With shortened weeks, company events and more nighttime activities, it’s okay to admit that you simply won’t have as much time as you usually done. Alter your expectations for the shortened weeks.

5. Find Sources That Motivate You

When I can’t find internal motivation, I look for external sources to power me through a lull. That may mean downloading one of the many small business owner podcasts, reading blog posts that inspire me or turning to a great business or social media bookto get my creative juices flowing. Whatever the medium, taking a break from my day to hear about other people’s challenges and triumphs reminds me why I work so hard in my own business. It gives me the push I need to get back to it.

Those are five things that help me to stay motivated and stress free during the busy holiday season. What works for you?

How to Effectively Network during the Holiday Season

By Emily Driscoll, Fox Business SJ Daily Blog Pix

The holiday season is often busy with parties and events to catch up with family and friends, but these gatherings can also be prime locations for job seekers to make connections and find a good lead.

Events like company holiday parties, volunteering opportunities and networking events are opportune times for recent grads and current students to make personal connections with those in their field.

Although some businesses are looking for temporary hires, job postings tend to dwindle during the holidays as companies focus on planning for the following year, says Kimberly Baker, career services manager at Bryant & Stratton College Online.

“This makes the holiday season a great time to network as decision makers are thinking about future growth,” she says.

The holidays also offer a great excuse for candidates to check in with people they connected with earlier in the year to provide a status update and send warm wishes, says Doug Brown, academic program manager for The Malcolm Baldrige School of Business’ MBA program at Post University.

“You can use this special time of year to check in with someone that you may not have spoken with in a while (or have been meaning to reconnect with) to find out how they are doing, wish them well this holiday season and connect with them on a genuine level,” he says.

For those who are gainfully employed and want to move up in their career or for recent grads just getting started, here are four tips to network effectively during the holiday season and land a job in the new year.

Make Multiple, but Genuine Connections

While it can be tempting to bounce around at a crowded party, it’s more important to make a strong and more lasting connection (or re-connection) with people while networking, says Brown.

Particularly when meeting people for the first time, it’s a good idea to be focused and target a few individuals to get acquainted with, advises Larry Nash, director of experienced and executive recruiting at Ernst & Young LLP.

“Don’t necessarily try to meet everybody because you might not have time to [build] a deeper rapport. Focus on three to five people and try to go deep in establishing a connection,” he says.

Don’t Make it All About You

To avoid falling into “what-can-you-do-for-me” mode during a conversation, Brown recommends grads use the 80-20 rule, where 80% of the conversation should be about the networking contact and 20% about the student/grad.

“Focus on really establishing a genuine connection with the people who you are speaking with–ask questions about how they are, how their family is and truly engage in the conversation,” he says. “If you take a genuine interest, you will leave a lasting and positive impression with them.”

Leave the Resume at Home

Baker notes that unless the holiday event is a job fair, avoid bringing a resume.

“A business card that has a link to a professional website highlighting your work or at the very least your LinkedIn profile is a perfect way to communicate your skills and stay connected to the person after the event,” she says.  “Make sure to exchange business cards as well so you have their current contact information and can follow up with them.”

Brown cautions against trying to tell a long story on a business card or using brochures or handouts—these should only be used for follow up rather than in a networking situation.

Follow Up

After meeting someone at an event, grads should follow up with a friendly email, mention how much they enjoyed speaking and wish them happy holidays–save the more professional/job-seeking email for after the New Year, recommends Baker.

Brown suggests going the extra mile and sending an old-fashioned handwritten thank-you note, which will go a long way in making a memorable impression.

“If time has gotten away from you and you haven’t had a chance to follow up promptly, don’t hide behind your embarrassment,” he says. “You can still pick up the phone and follow up with your contact–don’t let embarrassment get in the way of a potentially great contact.”

Stay on the Radar After the Holidays

Connecting with contacts over professional networking sites is a great way to stay on top of industry news and keep in touch without being overbearing, says Nash.

“It’s good to look at your network on LinkedIn or Facebook to see who you know at this organization and it’s important to contact them because many organizations have very strong and formal referral employer programs,” he says.  “People can use their networks to talk to colleagues about opportunities at their companies, so they get might get more notice when it’s coming from an employee rather than from somewhere else.”

Touching base with a contact every couple months by sending a link to an article or blog post that is relevant to their industry is a better alternative than grads only contacting them about open positions, says Baker.

“If they are local, see if they would like to get coffee or would be open to meeting for an informational interview,” she says. “However, if they agree to an informational interview, approach it as a friendly conversation with no expectation of a job offer. Instead, you should consider it an extension of your earlier conversation and an opportunity to gain additional insight into the industry and that company.”