Sales goals: What are they and how to set them correctly?

Companies commonly set objectives to be developed and met within a certain period, but for this to happen they cannot be planned randomly and without considering the processes that will carry out the fulfillment of the objectives. Without prior organization and joint work of all departments, the general objectives cannot be met.

The same happens with the objectives by area. In this article, we are going to focus on sales goals. What are they and how to set them correctly?

Sales objectives refer to goals or desired ends, which serve to guide and motivate all marketing actions. It is very important to correctly define these objectives in the sales plan to evaluate the actions and strategies carried out by the company.

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To be well defined, sales objectives must meet certain characteristics that distinguish them. Knowing the "what" and the "how" of what you want to achieve by setting sales goals will help you understand how to set or define them correctly. SMART objectives: specific, quantifiable, achievable, relevant, and temporary can serve you for this purpose.

Specific.

Sales goals should be as specific as possible. To do this, keep in mind where the company wants to pay special attention when setting them. If what the company is looking for is to focus on profits', you have to draw up a strategic plan based on increasing profit margins. So, they will be profitability targets.

But if, on the contrary, what you are looking for is to increase the percentage of market penetration, you are going to set the objectives based on market share. For example, introducing an innovative new product is an opportunity to take market share from existing products or, if your company is important, acquire a smaller one and invest the money and expertise in expanding your market.

Remember that when setting sales goals they should be as specific and detailed as possible.

Quantifiable.

If there are no quantitative criteria in your goals that your sellers can compare themselves to, there will be no way of knowing if they have achieved them or not. For this, it is essential to use metrics that are adapted to your business and that help you measure all the commercial activity of the sales area.

You should always start by knowing the results you want to achieve. In this way, you will set the objectives based on these results. Apply these same objectives to the commercial activities of your team and you will achieve them.

Achievable.

At this point, it is important to establish if the objectives you propose are realistic, and feasible to be met. For example, a monthly sales goal might be to increase prospecting calls by 20% over the previous month. But if you want to achieve this increase in your sales reps, you first have to consider whether they have the time and resources available to do so.

Don't forget that setting unrealistic and unattainable sales goals can be demotivating for your sales reps. And therefore this will not help them meet the overall sales goals.

Relevant.

Sales goals are really important, as they not only help the sales force or the commercial director, but they can also determine the revenue budget, which directly influences the general expenses budget of the entire company.

The business budget should be included in your sales forecast. In turn, the sales forecast includes the financial plan, the marketing budget, operations, human resources, etc. If the forecasts do not coincide at the end of the month with the results obtained, part of the business budget will be compromised.

In short, the objectives you set must be relevant and involve not only the sales area but the entire company. Returning to the previous example: increasing the number of calls does not necessarily mean an increase in the number of sales, but it can contribute to achieving this goal as well. Therefore, it is necessary to rank objectives according to the order of importance. We will expand on this idea towards the end of the article.

Temporal. 

This means allocating your team's time based on your sales goals. But it is not that simple, since sometimes you will feel the sensation that time is slipping through your fingers like sand, and it is the same or worse than what your sales representatives experience.

When you define the sales goals of your team, you must consider your customer portfolio, since you cannot allocate the same time to some as to others. Seek to delimit the customers that generate more money from those that generate less, and focus on the former, resolving their doubts immediately.

Therefore, when setting sales goals, avoid customers who add little value to your sales potential. But certainly, you have to discuss this with your team, so that each sales representative establishes a time limit to interact with each customer and that they do not go beyond that margin to detect the real interest of a potential customer.

How can you set sales goals correctly?

Now what you have to do, once you have raised the sales goals, categorized them, and defined them according to the SMART objectives, is to set them correctly. How? Hierarchize your objectives from the most to the least important, that is, put the desired objective first, and from there go down in order of priority. Imagine a pyramid and place the largest target at the top and the smallest at the bottom.

Although it does not mean that it is not important as well, the minor objective is simply such because it does not directly influence the fulfillment of the objective desired by the sales area and can be postponed without affecting the interests of the company.

Hierarchizing your sales goals will allow you not only to organize them in order of relevance but also to better plan the tasks to precisely fulfill those that lead the pyramid since those are the main ones that you want to achieve in a stipulated period. It also means that these sales goals you are looking to achieve are more urgent for your business purposes.

In short, when planning your sales goals, make sure they are important to get more customers and sales closings in the commercial area, and also add value to your company. Also that they are achievable, that they respond to a certain term, and that they are measurable and specific. Once you have them, prioritize them and start working on them with your sales team!