The Power of Five-Creating Personal Financial Goals

In the world of sales you don’t hear many people talking about or discussing ‘personal financial goals’. Know why? Sales managers don’t cover it, companies don’t understand the importance of those goals and salespeople themselves would rather not because of that pesky word accountability. Personal financial goals is one of the 5 basic elements of sales success. Without PFG’s how do salespeople know how much they need to sell? What their sales activities need to be? I can make a strong case that PFGs are the key to success in sales.

Another way to look at this is to ask yourself this question: “How much does it cost you to wake up every day?” Ah, well let’s see. Exactly. Did I ever do this when I was a sales cub? No! My financial goals were usually dictated by the ‘sales targets’ the company set for me. If the target was a million dollars in sales and my commission was 6% on all sales then my income was $60,000 for that year. (That was some decent lettuce in the 70’s folks!) Depending on my tax bracket I knew the approximate net and that was what I had to spend on the basics to keep the family from food stamps.

In a naïve way I guess this makes sense. From a logical, long-term, financially secure perspective this makes no sense. Personal financial goals consist of two ingredients. One is the monthly costs to live. Two is what it costs to bring your dreams to life. Dreams do not include a Lamborghini parked in the driveway. OK, they could include it but it would be way down the list of common sense dreams. Translate dreams to: short-term (5 years) financial goals and long-term financial security. This is the easy part.

Translating these to daily sales activities and then into dollars requires intimate knowledge of planning, your market place, the products you sell, competition, prospecting methods, sales metrics, average revenue per sale, and a sales process. Several of these will appear in later posts over the next several weeks.

Between the ages of 22 and 30 very little of this registers on the conscious mind of a salesperson. Some of it begins to trickle in during the 30’s and that is a mistake. Here’s why. Around a salesperson’s mid thirties is when many salespeople begin to make some serious money. (I don’t see a distinction on gender here. I could probably make a case that women get there faster than men.) That will continue into the 40’s until around age 45. Call it a ten-year window of high earning potential. Does it end after that? No, but other things occur concurrently. Child raising, schools, sports, short-term goals (requiring money) and thoughts about funding college or part of it. Pesky thoughts of mortality may even enter into the mental mix. What people do with their money in this time frame is extremely important. Might as well say critical!

Creating personal financial goals therefore becomes a path to success both in the short-term as well as the long-term. This is not just a ten minute conversation with yourself in the shower. “Let’s see, for 2014 I need to earn around $90K give or take.” That WILL NOT CUT IT! Do yourself a favor and spend a day thinking about this topic. Start to wrap some numbers around your sales activities and goals. When you’re rounding age 60 entering the final glide you will be happy you spent the time pondering.

The Power of Five

I was asked to give a talk on sales not long ago. There are so many topics relative to sales that it is difficult to choose one that will appeal to everyone. Out of nowhere came The Power of Five. The five topics I covered were:

  1. Define Markets
  2. Create Personal Financial Goals
  3. Build a Prospecting Plan
  4. Own a Sales Process
  5. Get a Coach

I maintain that these 5 are the foundation of sales success. Are there others? I’m sure they are out there but for October 21st these will do.

Market definition, who buys from you, who you should prospect for, what does a perfect client look like are all pretty much the same thing at least in a general way. I started with this one because it helps to know who you need to sell to before you put together a prospecting plan. When I work with clients whether they are individuals or companies I ask that they profile existing accounts to determine if there are common characteristics among them. Again, not rocket science.

Here are a few characteristics:

  1. Industry
  2. Products they buy from you
  3. Company size
  4. Why the customer buys from you
  5. How did you get them as customers
  6. How often so they buy
  7. Do they buy an assortment of products or services

The other important question to ask is: What are You Good at? This has tremendous implications on market definition. What you are good at doing and who you sell to are flip sides of the same coin. Through trial and error (probably more errors than are necessary) I discovered that I am at my best when I work in a small company environment. That has played out over the last 10 years as I morphed from pure sales training to helping smaller companies grow their business. What I am good at also relates to what I like to do. Very large on my list of ‘likes’ is seeing people grow their talents. Nothing makes me happier than to see a salesperson or a company moves past obstacles that previously held them in check. And frankly, it is not about me! Providing the knowledge and experience and showing someone why that knowledge can propel them past their current level of mediocrity is more than enough for me.

Also, be wary of trying to be all things to all people! It is tempting to say “I can do that” when a prospect asks if you can provide specific expertise in an area you are not particularly familiar with. Dollar signs trump experience! My advice is don’t do it. Broadening your markets may mean that you are diluting your efforts and losing opportunities in your main market. And if you don’t succeed in a new market what does that do for your reputation and confidence?

Here’s the last question worth asking yourself: What are the Characteristics of What You do That Appeal to Potential Clients? It really comes down to the more you know about yourself, what you do and who your best clients/customers are.

The End!

Pick up any shrink or self-help book and my guess is that before page 50 the author will tell you to “stay in the present”. I could not agree more. However! I’ll go back to my father for an example of someone who never lived in the past, present or future. To tell you the truth I’m not sure what he thought about, what he planned for, how he enjoyed life. Clearly, he never thought of the end. Even after he retired he still got dressed for work everyday. What the hell did my mother think when he showed up at the breakfast table in a white shirt, tie and suit coat! (Probably Show Me The Money)

I remember looking into my dad’s eyes as he was dying. I remember distinctly wondering what he was thinking about. His eyes seemed to carry the message I’m glad it’s over big guy, I’m tired. Or maybe he was wondering how he was going to fill the car up since he was flat broke.

OK, enough preamble. Regardless of your present age you need to carve time out of your life and begin to think about the end of your life or more accurately what will your financial, emotional, and mental outlook be when you are close to the expiration date on living. Downer subject, huh? I don’t think so. There are no life do-overs so why not look back as life begins the last act and have the smile on your face that indicates “I did good”!

I don’t mean to turn this into bullet point mania but these thoughts are worth pondering:

  1. What do you really like to do? What turns your crank, so to speak?
  2. Do you do enough of that on a daily basis?
  3. How do you like to have fun? Will you always have time to do that down the road?
  4. How much money do you need to save now so you can enjoy life down the road.
  5. Are you a big company person, small company person, own your own company person?
  6. How do your strengths and weaknesses help and/or hinder you?
  7. What will your last thought(s) be right before you know that your time is up? (Might want to put this one first.)
  8. Are there specific objectives you want to achieve in your life?
  9. How do you want to impact your kids?
  10. Is there some action, document, thought you want to leave with your family?
  11. Who are you?

Consider this an exercise about successful living on your way to your expiration date. And since none of us know when that will be shouldn’t you be thinking about all these things N-O-W?

Sales Management Wake Up Call-Q1 Is Almost History!

As a general rule of thumb I intensely disliked the first quarter of any business year. And for good reason. For seven years as a salesperson we had a comp plan that Sir Isaac himself couldn’t have figured out. By the time we figured out the new annual tweak to the program we had to load in at the end of the fiscal year to make any money. You know how that affected January and part of February. Long about October 20th the ugly cycle started again.

Then we had this little start up in the 80’s. We had certain revenue milestones that keyed in stock options and other “perky” little things. Long about mid- June (FY ended in July) we’d sidle up to our best customers and ask them to fill the basement store room (the CFO never knew they existed) with an extra six weeks of product. There went the first quarter of the next fiscal year-again! (I’m not condoning the behavior here but it sure helped pay for the majority of two college educations!)

Since those days are a dim memory let’s be realistic about what March 10th means. Twenty five percent of the fiscal year is close to being toast. Here’s what went through my brain in those bygone days:

  1. Are we 25% or more of the way to making our sales forecast?
  2. Are the opportunities collecting mold in the funnel or are they moving?
  3. Are the salespeople seeing the right prospects?
  4. Are we growing the business we don’t have in our existing customer accounts?
  5. Are the salespeople following the sales activity plans they created for the current year?
  6. Are we chasing bad prospects? (See #2)
  7. Are we seeing the right people in prospect accounts?
  8. Based on the manager’s observations are the salespeople using the sales language correctly?
  9. As the sales manager am I doing the right stuff?

This is one of those times when you begin to see the good managers earn their money and the bad managers sweat. If we were at plan or above I’d gather the salespeople together for a play date in a warm climate. Golf, pool, spa and good food. A small portion of the time we would spend plotting our course for the remainder of the year. If we were below plan we’d meet in Minneapolis in late March. Ideal conditions for that meeting were below zero temps with a blizzard. They weren’t fun.

The Final Thought: “Succes is neither magical nor mysterious. Success is the natural consequence of consistenly applying basic fundamentals.” Jim Rohn