Every business needs a strong sales strategy to survive, and to drive sustainable value creation. It is not only about sales, but also about quality.
One thing the pandemic and the supply chain squeeze of the past few years have highlighted is that chasing top line revenue for its own sake is not a viable long-term strategy. The aim of any business should be to invest its resources as efficiently as possible to generate maximum returns. This means focusing on the right kind of sales – that is, the most profitable ones.
This means reviewing revenues and moving away from those where profits are lower, to focus on the ones that strategically make sense; the relationships that can be developed further to create longer-term value for your business.
As well as looking at individual clients or customers, this could include reviewing customer segments, product or service categories and sales channels to focus limited resources on those that are most profitable. This might mean, for example, reducing some product lines that although sell well, generate lower profit. It could mean focusing on fewer, larger (and more profitable) customers, diverting resources to higher-profit online sales channels, or reviewing pricing to optimise margins.
Comprehensive, accurate data is crucial for this, and then using that data to drive decision-making and scenario planning, helping you identify critical lead indicators to monitor performance. It might require investment in new technology or skills to enable team members to take on these more data-focused roles – technology and skills that are only going to become even more important for business growth in future.
Privately-owned businesses, in one sense, have an advantage here, in that they often enjoy closer, more personal relationships with their customers and clients. By their very nature, they also tend to be more agile and adaptable than their larger corporate competitors. They may be able to leverage these advantages to not only gain a clearer understanding of customer needs and expectations – and adapt their sales strategy accordingly - but also to be more flexible on pricing, and prioritise their own business needs as a result.
Understanding the customer mindset also extends to the physical environment. The emphasis is increasingly on optimising the customer experience to increase engagement and drive higher value sales. For high street retailers or leisure businesses, this may involve reconfiguring the sales environment to improve the customer experience.
Inevitably, a sales strategy can only be as resilient as the supply chain that underpins it. Global disruptions over the past few years have only served to emphasise this point. Whereas once the priority may have been getting components or stock supplied as cheaply as possible following the just-in-time principle, security of supply is now more important than ever. Again, privately-owned businesses are often in a good position to leverage their supply chain relationships to strengthen this security. It’s about taking a step back and mapping out who are the critical relationships, who are the critical suppliers and where are the potential bottlenecks or risks.
Sustainability should be a consideration too, both in terms of the supply chain and customer proposition. Many private businesses, almost by definition, have strong ethical and social principles that the business is founded on. But they may not have been clearly identified, documented or communicated before. Now is the time to do that, to integrate those ESG values into the sales strategy to align both with consumer expectations and, increasingly, compliance and reporting requirements which, even if they do not affect the business itself, are likely to affect suppliers or customers elsewhere in the supply chain.
Building sales strategy resilience might also mean taking a more transparent approach to collaboration; partnering with suppliers or peers, for example, to complement or strengthen a particular service offering or fill a gap in your customer proposition.
The past two to three years have undoubtedly tested many privately-owned businesses to the limit. By building a resilient sales strategy, businesses can help ensure their next period of growth is strong, secure and sustainable.