The Common Mistakes of Sales Management

A large proportion of company profits is often eat up by Salespeople's salaries. Despite increased turnover variable gross margins diminish, leading to alternatives to personal selling.

More often than not, it is the management who are at fault and not the salespeople. The reason for this is simple; management styles and methods are often not in keeping with the times hence the increase in popularity in people wanting to attend a management course.

The six most common mistakes made by sales managers are as following:

1. Not reacting to changes in market structure

The buying practices of many markets have changed dramatically. Decisions being made are being based on new criteria. Example: In the past, craftsmen advised farmers on their choice of materials; today, it is the planners (architects, engineers) who have decisive influence.

Example: It is becoming increasingly common for Sales Staff to deal mainly with departmental buyers in large consumer organisations. As a result, local merchants seem to be losing their importance.

Today's salesperson has to deal with more highly qualified decision-makers who exercise greater powers than in the past. Sales managers can ensure that their salespeople are not out of their depth by revising sales documents and verbal sales techniques, and by encouraging staff to further their education and training.

2. Thinking only of short-term turnover

Sales success, nowadays, is depend-ant on a number of components, not just on short-term increases in turnover.

Example: Architects do not buy building materials directly from the manufacturer. However, the opinion of the architect is a very important factor in influencing the choice made by the clients. This means that salespeople are obliged to deal with the target group opinion leaders. This strategy, however, does not immediately affect the turnover.

On the contrary, turnover remains stagnant. Very few people in management seem really prepared to sacrifice a couple of percent of turnover in the short-term, for a deal which is seen as important in the long-term. By making the salespeople manage on a lower income you are penalising them still further.

You cannot achieve Strategic selling simply by introducing a turnover-related system of payment. For long-term success it is necessary to include qualitative criticism.

3. Overhauled sales structures

The fact that a particular sales structure was chosen once - be it in connection with the division of a sales district or with the allocation of goods or clients - does not mean that it will be the correct one in five years' time. In spite of the possibility of resistance structural changes should not be avoided.

Example: A company, producing medical equipment, supplies doctors with specialist equipment. The sales-force is already canvassing medical students as future clients. Although many young doctors later settle far away from their place of study, they continue to be looked after by their sales representative. As the sales representative is not prepared to give up a currently profitable client to a colleague, the sales organisation becomes increasingly inefficient.

The crucial mistake made by the sales management is not charging the students for the advice given to them by salespeople. When restructuring the sales department, it is important to introduce a system of payment that takes into account the building of relations with potential clients.

4. Control instead of motivation

There are some sales managers who still do not think much of current methods of management and staff control. They firmly believe that their employees will only produce the laced under constant pressure and constantly watched.

Example: A producer of proprietary articles makes his salespeople phone him at 8 am every morning. The salespeople are then called back to check that they are not at home. You can imagine what sort of effect this daily "motivation push" has upon the salesperson.

Without doubt, there has to be a certain degree of control. However, salespeople should not feel that their reports are being used to keep them in check, but are instead, a source of support. Any good sales manager knows it is vital to your salespeople that you support them by helping them to solve their problems (for example, accompany them on client visits). Mixing effective challenge and support is a great skill of an effective manager which is covered on any good management course.

5. Not making full use of innovations

Technical innovations are the best way of profiling the company and of pulling ahead of the competition. Underlining your technical competence and top achievements makes your clients and competitors more aware of you. However, many sales managers underestimate the importance of technical innovations.

Here are two mistakes which are frequently made:

Rather than stressing the product's benefits, the new product is launched at a very low introductory price. Consequently, it fails to take the lead among the competition as a technical innovator.

The technical innovation is ignored. The sales manager leaves it up to the salespeople how to launch the new product, rather than presenting them with a concept and showing them what is involved.

6. A lack of openness

There is a flagrant lack of openness in many firms. The sales manager hides behind formalities such as statistics on turnover and visit reports.

Employees, on the other hand, would prefer to have regular meetings to discuss their problems, to explain structural changes in the market, to discuss mistakes involved in the launch of new products. The meetings could also be used for criticising unclear positioning and for making suggestions on how to look after the market.

Are you guilty of making any of the above mistakes? If so, you should make a conscious effort to change your style of management. Your employees will be grateful, and so will you! Attending a good management course can also help you to develop effective management skills.