Sunday, June 25, 2006

Sales - Importance of Planning

"It’s not the plan that is important, it’s the planning" -- Dr. Gram Edward's

Last week I met a friend of mine at Casa Picola restaurant in Bangalore. Lets call him Mr. G, who is the sales head at reputed company that sells networking equipment such routers, switches, etc. We were generally chatting about work and he mentioned that he was chasing a huge order - Rs 20 Million from a local manufacturing firm. Over the next 30 minutes, while eating a burger, we discussed about the sales plan that is needed to win that customer. This discussion prompted me to write about sales planning.

Sales planning is the first necessary step in winning a major account. In B2B world, it is next to impossible to win a major account without diligent sales planning. So this article is all about sales planning.

All sales plans will have four essential components:
  1. Situation assessment
  2. Objective
  3. Strategy
  4. Tactics
These four are sequential steps that are necessary in developing a winning sales plan.

Situation Assessment

To develop a workable and solid sales plan, it is essential to know the current situation: What is the customer’s business need? When does the customer intend to buy? What is the sales environment? Who is the competition? What are the pricing pressures from the customer?

Often times customers send out a Request for Proposal/Quotation {RFP/RFQ) - which describes the customer’s technical needs, but the business needs are never mentioned. Also the salesmen do not know who the major decision makers are and what are their concerns/objectives. This makes the process of situation assessment a difficult task. To accomplish this, salesmen often will need some business intelligence. Few firms have a dedicated group which collects business intelligence, but most salesmen will have to be contended with what they can collect from customer contacts, vendors, and competitors.

Information collected during situation assessment has to be written down. Documenting is of immense value to overall sales process. In B2B markets, sale to a single customer is often handled by a team - usually drawn from different departments. A written document on situation assessment helps sharing this information with the entire sales team - this bringing everyone on the same page. Sales manager working on a B2B sale will often be working on multiple opportunities. Documenting the business situation helps the salesman by providing concise, accurate and reliable information when needed. Documenting will help prevent salesman from confusing or remembering things wrongly or confusing the customer.

For example, the salesman at computer firm is trying to sell data storage solution to a publishing house. He has received the RFP. The RFP has to be analyzed by an engineer to access the technical challenges and propose a suitable solution. The pricing for the proposed solution has to be cleared with the finance - and if required, the finance department will have to work out a suitable payment/credit terms. The marketing department then generates a suitable sales presentation or other marketing collateral. A lawyer from the legal department will have to write up the contract. All these members together form the sales team. The members of this team may be geographically dispersed and yet they need to collaborate to win. Each member on this team will be working on multiple accounts and they will need accurate & reliable information to work with.

Situation assessment must be done continuously during the sales process. Complex B2B sales usually take several weeks or months. The competitive landscape and the business outlook is always dynamic, thus information must be continuously be updated even after the sale is closed. If the sale is done, this information can then be passed on to Customer Account Manager or Customer Relations Manager etc. The knowledge gained in the pre-sales process will be very useful in the post-sale customer relationship management.

Salesmen often have numerous excuses not to document the customer/prospect situation. One of them being that it takes too much time to do it. Other is that the chances of winning is ~20% so in 80% of the cases they will not win. So documenting all the details is a waste of time. This argument however is no longer valid. Today there are several software tools:, outlook organizer etc., to help salesmen capture information in a time efficient manner. Few companies have even deployed a sales transcription service - where salesmen have to record their assessment of the situation, that will be converted into text by a service provider, and that data will be analyzed and processed and distributed by the marketing department.


Objective is nothing but three statements: What to sell, For what price and by when? Defining this is absolutely essential for developing an effective strategy. Note that the answers to these three statements are derived from situation assessment. By careful situation assessment, salesman will know what the company will buy, and what are their price targets and when they will buy. This information of customer intentions must be shared with all members of the sales team and executives - this will help in formulating the sales objective.

Note that the customer objective on product, price and time frame may differ from that of the seller. Salesman’s objective is to get the customer pay the full price - i.e., no discounts ( This helps the bottom line), and in a time frame that can be supported by manufacturing/engineering or service groups. While the customer objective is to get the lowest price and in a time frame suitable for him. It then becomes the job of the salesman to bridge these two diverse objectives in order to close the deal.

Sometimes the objective of the seller may not be to sell at all. In a B2B world, there exists a strong relationship between the buyer and seller. A new vendor who wishes to displace the incumbent may have a different objective. Many first time vendors (to that buyer) may have an objective which is to lose the bid - but come a close second so that they will be invited next time and in the mean time learn as much as possible about the customer during the sales/bidding process so that they are better prepared to replace the incumbent.


A sales strategy is the one which answers the question:

Customer will buy from me because _____________??

A salesman should be able to answer this question with conviction. If he/she cannot answer this with 100% confidence, then the sales strategy is not complete. Sales strategy is absolutely essential to win the customer.

"A winning general always has a plan to create situations necessary for victory" - Sun Tsu

The above statement provides a concise requirement for a strategy: Situation assessment - knowing the current situation and the required situation for victory, Objective for the plan and the strategy (plan) to achieve the objective.

In the world of sales the objective is to determine what to sell, when to sell and for how much. This objective cannot be developed without knowing the current market situation. In sales, situation is always dynamic which forces the salesman to have in-depth assessment of the situation. Some of the things to be considered for situation assessment are:
  • Financial Situation of the customer
  • The buying criteria, evaluation process and decision process
  • Criticality/Importance of this purchase
  • Market trends
  • Customer Issues
  • Goals & objectives of the customer
  • Leadership style of the customer
  • Market position of the customer
  • Competition in this account
  • History of this account
  • Allies/Customer champion in this account
Market reputation of your company/product (Strengths/Weakness of your product)

Intimately knowing the current situation will help the salesman answer the big question. Often I find it useful to develop a top ten list stating the reasons to buy. For example:

  1. Customer will buy from me because my product has to lowest cost of ownership and/or highest ROI
  2. Customer will buy from me because I guarantee the successful installation of the product
  3. Customer will buy from me because I can deliver a customized product which will meet their unique requirements
  4. Customer will buy from me because my product is the safest alternative.
  5. Customer will buy from me because my company has the best understanding of their business requirements and have the capability to ensure customer’s success.
  6. Customer will buy from me because my product is the best among all the alternatives available to them.
  7. Customer will buy from me because my company enjoys the highest level of relationship with their executives
  8. Customer will buy from me because we provide the best post-sales support
  9. Customer will buy from me because my solution will meet their budget constrains
  10. Customer will buy from me because we are also sharing the risk in the project.

It is always not easy to come up with a top ten list for every account in the initial days. But as time proceeds, making a top three list on why customer chose to buy from me for the deals already concluded will help identifying the reasons why future prospects will buy from you. Similarly making a list of reasons as to why the customer did not buy from you in the past will help address the weak points and develop a winning strategy.

The most common reason why a salesman lost an account will be: " I lost a customer because I did not have a strategy to win that account" This however happens because the salesman does not have a thorough knowledge about the current situation. Knowledge is the key - A thorough situation assessment will help a salesman to overcome challenges in the business climate, develop multiple sales strategies, anticipate challenges and adapt accordingly.

A successful sales strategy can be characterized in two words "Flexible" and "Thorough". A successful sales strategy must be detail oriented down to finer points and flexible to adapt to changing business environment.


Tactical planning is the final step in the sales planning process. Tactics that has to be deployed to win the customer is determined by the earlier three stages of situation assessment, Objective and strategy. Tactical planning becomes easier if the other stages (Situation Assessment, Objectives, Strategy) are completed first.

Sales is a dynamic process - competitive situation is always changing. This implies that the sales plan must be flexible and tactical plans must be flexible. To get maximum flexibility, tactical plans must include a lot of details - including trivial details which are of interest to customer. To visualize the importance of details, think of Lexus car. The attention to details in fit and finish makes it a luxury car that commands a premium price. Variation on these details allows a salesman to position the product differently.

Tony, a top salesman at my company has won a lot of deals due to his meticulous attention to detail. This provides his prospective customers a sense of comfort to buy from him. Some of the tactical details in his sales plans are:
  • Give the best reference of his past clients that best matches with the current prospect’s needs
  • Willingness to go over the finer points of the customer’s requirements - and collecting all details before working out the contract details.
  • Making it a point to meet all the stakeholders & executives of the prospect during the sales process
  • Address all objections or concerns no matter how trivial or unfounded they are - and make the customer comfortable.
  • Ensure that all presentations are well rehearsed and see to it that there are no surprises while presenting it in front of the customer.
  • Develop a sales checklist. For example while selling an ASIC, Tony has a checklist for: Initial presentation, Product specification documents, Customer requirement document, Complete technical solution documents, get approval for the viability of the solution from customer’s chief engineer, show the financial value of the proposal to the CFO, etc.
Attention to details does not always necessary result in increased price, but it definitely increases the confidence of C-level executives in your product. The sales checklist process helps the salesman to concentrate on details. The checklist should be dynamic - but it should always include your company’s standard procedures and processes, competitive influences, strengths, weakness, opportunities and threats for each account etc.

Every successful salesman will have a master template that includes events, meetings, approvals, calls, presentations, proposals, quotations, demonstrations etc.

Closing thoughts

Winning an order begins with the sales plan. The final sales plan is necessary but the main value lies in the planning process. The sales plan is just the end product of the sales planning process. It is during the sales planning process challenges, strengths, weakness and opportunities with each customer are discovered and this knowledge is essential for developing the winning sales plan.

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