Ten Key Questions for Growing Sales Revenue

Mar 21

By Larry Goddard and Laurence Franklin

1. Are the markets we operate in growing?

Growing markets (like a rising tide that lifts all ships) generally facilitates growth for all market participants – provided they offer competitive products and services.

If your markets are not growing, the answers to the following questions become much more important.

2. How do our products and service(s) compare to our competitors?

Do you have a compelling Value Proposition – or are you a “me too” business?

Significant growth – without a strong Value Proposition – is exceedingly difficult (unless the overall market is growing strongly)!

3. How many customers did we add and lose (or experience sales growth or decline) in the past year - and why did this happen?

If you are adding more customers than you are losing (or experience sales growth with existing customers), your team is likely doing a lot of things well.

If you are losing a lot of customers (or experiencing sales declines), it may indicate:

The marketplace is unhappy with your products or service(s)
Your competitors are offering something more appealing

It takes a lot of time and resources to sign up new customers. Losing them is counterproductive. Putting in effort to retain them can be worthwhile.

4. How large are our Returns, Allowances, Credits, Price Allowances and Warranty Claims

Large Returns, Allowances, Credits, Price Allowances or Warranty Claims usually indicate customer dissatisfaction with your Value Proposition - with products or service(s) being perceived as defective or below expectations.

This presents an Opportunity. If you can analyze and identify the root causes of the customer dissatisfaction, you might be able to take corrective action. This could enhance Revenue, Bottom Line and Customer Satisfaction

5. What is our average Wallet Share with customers

If you sell a customer $100,000 and they purchase $500,000 of those products, you have 20% Wallet Share.

If you find out you have a high Wallet Share with a customer, it is good and bad news

Good - because you have done a good job of maximizing the opportunity with that customer.
Bad - because your sales growth to that customer is primarily only going to happen if the customer itself is growing.

Low Wallet Share is, in fact, a big Opportunity. If you can convince the customer to give you a bigger share of their spending dollars, you can achieve significant sales growth without going through all the hard work of sourcing and wooing a new customer.

6. What other products do our customers purchase - that they are not buying from us?

This is another big opportunity, especially if you can convince customers to buy products or services that you already offer (no learning curve for you).

It is a little more challenging (but potentially still a good opportunity) if you do not currently offer the products. Can you make them or source them in a cost-effective way?

7. What is our Average Order size?

Focusing on improving (via Wallet Share Upselling and Cross-selling) can pay handsome dividends in sales growth and in lowering Cost to Serve customers.

8. What does our Ideal Customer look like - and what % of our sales are to Ideal Customers?

Not all customers are ideal. Customers that appreciate your Value Proposition and/or are easier to deal with might be more ideal for you.

Understanding – and pursuing – ideal customers is likely to facilitate more profitable growth for you.

9. How effective are our Lead Generation programs?

Salespeople who have to spend time looking for leads are generally less effective than those who are provided with qualified leads that result from an effective Lead Generation program (resulting from Search Engine Optimization, Paid Search, Digital and traditional advertising, Trade Shows, Telemarketing, Email Campaigns, Direct Mail, etc.).

10. What is our Sales Closing Ratio?

Another highly valuable metric, that tells you how effective your sales team is. While your Value Proposition will have a major impact, it can also be significantly enhanced by:

Sales coverage
Having the right balance of “Hunters” and “Farmers”
Sales training
A Customer Relationship Management (CRM) system
Salesperson goals and accountability
Appropriate compensation and incentive systems

Larry Goddard