Reverse engineering goals

- In the previous section, we looked at breaking down our goals from large to medium and small. So here, I want us to talk about how we actually break them down. And to do that, I've used a simple example all salespeople will be doing. Setting a money focused goal. For this, considering how we break down a large goal like making $100,000 this year. I do this by reverse engineering the goal and calculating what we need to happen before working out how we'll actually make it happen. Now before we do, I've added a downloadable to this course's exercise files, which contains an Excel calculator to help you input your own numbers. So download that and follow along as we go through this. It should be filled in for this example, but feel free to edit it as we go. You simply need to fill in the light blue cells. Firstly, let's say we have a $40,000 basic salary. So we need to find $60,000 in commission. Next, consider what your commission plan is and work out how much you need to sell to hit that goal. Let's say you get 5% of whatever revenue you bring in. So we mark Y next to revenue on the commission type on the downloadable. That means you'd need to sell $1.2 million in total. And that sounds like a lot, but now consider the units required to hit that number. If you sell the items at say $1,000 of average. It could be software services, smartphones, office furniture, whatever. Then you'd need to be selling 1200 units in the year. That's 100 years units a month. Remember, this is on average. Sometimes we're selling 150 units in a month, and sometimes we're selling 50, but it evens out to be 100 units per month. So next, we look at our average sale per meeting. Now, let's say on average 10 units per meeting. Some people buy five, some people buy 30, some people buy 50, but on average, we sell 10 per meeting. So we then divide our monthly goal by four to know how many we need to sell per week. So that's 10 divided by four that's 2.5, but let's just round it up to three, just to be safe. Next, how many calls do we need to make for those three meetings a week to be booked? Let's say we generally get a meeting from every five conversations we have with decision-makers. So we need to have 13 conversations with decision makers on the phone to get our four meetings. 13 divided by five, that's 2.5 conversations a day. But again, let's run that up to three and target three conversations day. But let's keep going. How many cold calls does it take to reach a decision maker in the first place? Let's it's one in 15, so 38 calls a day. Some things may change in there, depending on external factors like time of year or the current climate or how in demand your product is, and so on. But those calculations are there as averages. To make an additional $60,000 in commission and therefore make $100,000 in the year, you need to make 38 calls a day on average without fail. So there's your short-term goal for the day, 38 calls and whichever of the three weekly meetings you have on that day. Everything around there should be assisting that goal. But 38 calls a day, alongside your three meetings a week may be hard work. So the only thing to consider once these parameters have been set is where we can improve. Sticking with the commission example. If you reach the decision maker in 10 calls, on average, instead of 15, you'd be earning the same amount from only 25 calls a day. Or if you sold 15 rather than 10 units per meeting, then you'd only need to be doing two meetings a week rather than three. That'd mean you only need two conversations with decision makers a day rather than three, which would only take 25 calls a day. Or if you had both improvements together, then you'd be earning $100,000 in the year from just 17 calls a day or two meetings a week. That extra time can be spent doing whatever you want. Either have it spared for development or relaxation, or keep to the 40 calls a day and sell even more. By those calculations, those improvements and the 38 calls a day with three meetings a week would add an extra $30,000 to your annual paycheck. So, work out these numbers and stick to them, and then find improvements for fail-safe results. Have a play around with the calculator and see what your statistics create.