If you’ve been in sales for a while, you’re likely familiar with sales stress — that sickening feeling that you’re not going to meet your targets for the quarter. You’re not alone. According to one report by The Bridge Group, only about 50% of sales reps make their quota. It’s little wonder reps are stressed.
You’ve read the basic tips for reducing sales stress — get more sleep, eat right, take a break, etc. All important, but these strategies are reactive — they’re more applicable when you’re halfway through the quarter and scrambling to hit your numbers.
Proactive measures ensure that sales stress never becomes a major problem, and they depend on sales forecasting. Sales reps who create an accurate forecast and then break down target numbers into actionable steps are much better prepared than reps who don’t. But the reality is, most sales reps don’t know their numbers. Or they don’t pay attention to them. They’re not thinking or looking at the big picture.
Planning is crucial to not only reducing stress, but also being productive and actually meeting quotas. You need to proactively plan out how to meet your quota at the beginning of the quarter rather than waiting until the end.
Take a data-driven approach to reduce sales stress.
Set yourself up for success with a sales forecast
Sales forecasting is a process of estimating future sales. Use it to your advantage. An accurate sales forecast is the engine that powers the actual planning and meeting of your quarterly quota (or any quota for that matter).
Make sure you have the right process already in place to make your forecasts more accurate. Particularly if you are a sales manager, there is preliminary work you can do to reduce stress and avoid missing quotas:
Managers: Utilize your reps’ strengths. Everyone on your team has different capabilities. Where one rep might excel at lead generation, another may be a fantastic closer. To identify rep strength and weaknesses, segment your deals by industry and then by rep to determine what verticals each rep succeeds in.
Reps: Close the right deals. If your pipeline value is poor, it’s doubtful the deals you close will be sustainable. Identify the types of leads that generate the most value for your company. Then segment deals by lead qualities such as industry, title, and budget. Finally, measure lead yield to pinpoint where to focus your outreach efforts.
Managers and reps: Focus less on activities. An outcome is more important than an activity. For example, while you may make 100 calls in a month, this activity is useless if you’re not actually booking meetings or demos. Don’t mistake busyness for effectiveness. Be strategic in your activity efforts. Focus less on the number and more on the quality of outcomes.
With the above foundation in place, optimize your sales forecasting process:
- Track your sales data: Determine what sales activities work best based on won and lost deal data. The best approach to managing this data is to use a CRM, but you can also use an introductory sales forecast template depending on the size of your company.
- Manage your sales pipeline: Your pipeline is a structured system where your deals live. Review deals in each stage to understand their progress and identify bottlenecks. Carefully maintain each stage in the pipeline so your forecasts are more accurate.
- Improve your forecasting model: Clearly understand the type of forecasting model you are using. Does it differ based on the weekly, monthly, or quarterly forecasts? Be consistent with the methodology, flexible, and don’t overcomplicate your model. Continually look for areas that need improvement and adjust accordingly.
Now that you have the foundation, follow the concrete steps below to plan your sales strategy at the beginning of the quarter. The result? Reduced sales stress three months later.
Step 1: Take a realistic look at your quota
First and foremost, make sure that your quarterly sales quota is reasonable. Are the correct conclusions being drawn from the sales forecast? If a manager is making the decision, ask for input in the process. Back up with research and evidence from last quarter on why you can or cannot reach the sales target suggested.
Look internally at last quarter’s forecast, sales figures and customer sentiment. Also review outside sources such as industry reports and news. All of this information will offer a 360-degree view of internal and external factors. You can then understand how these factors might impact your ability to meet quotas.
Be realistic and make sure targets are attainable and measurable. Let’s say you have a quota of 25 deals to close at the end of the quarter. You must win at least 50% of deals in your pipeline to reach that number. If you have a plan to reach that 50%, struggling to meet your quota won’t be an issue.
One forecasting technique that might be helpful to review when determining your quota is opportunity stages forecasting. With this method, you can review the likelihood of a deal being won in all stages of your pipeline:
Compare the win likelihood from the last quarter with the number of deals actually won. This method doesn’t take the qualities of an individual deal into consideration. However, it is helpful to understand the win rate for each stage in the past so you can better determine if your current quota is realistic and manageable.
The more context you can provide with your quota, the better you can break it down into a quarterly plan of actionable steps.
Step 2: Use your CRM to manage your numbers
Your CRM takes everything — your sales goals, customers, conversations, and activities — and places it all into an organized, insightful format. It helps you easily see what’s worked, what hasn’t, and how you can improve your process.
Take advantage of your CRM’s full pipeline visibility. Find answers to questions like:
- What did your numbers look like last quarter?
- How long did deals stay in each stage of your pipeline?
- What were the activities that helped you achieve your quota?
- Are you on track to meet your current goals?
If you’ve forecasted before, look at your last quarter numbers in your CRM. How long did it take you to close X amount of deals? Also, take advantage of the metrics in your CRM. Sales pipeline metrics like stage-to-stage conversion rate help keep track of how you’re actually reaching your goals.
Another excellent use of your CRM is for reviewing reports. For example, take a look at analyses in your CRM such as stage duration to review your chances of closing a deal based on won and lost deals data.
The stage duration analysis looks at how much time deals spend in a given stage of your pipeline. Review the average number of days for won deals as compared to lost to identify which stages need the most work during the quarter.
The right CRM should offer all of these insights and more so you can plan according to past data and easily review if you’re on track with your current numbers.
Step 3: Plan the rest of your year/quarter/month
Once you’ve realistically reviewed your numbers and they’re all tracked in your CRM, you can plan for whatever deadline you have to hit. Break the process down into manageable, actionable steps and prioritize your time.
For example, let’s consider the following scenario:
- You need 50 qualified leads to meet your quota for the month.
- You only have 4 weeks (20 working days).
Create a simple formula based on this information. Divide the number of qualified leads by the number of weeks. You, therefore, need to convert 12.5 leads per week. Next, break down this number into activities. What is the number of meetings/calls/emails you need to hit this number every week?
Do this same process for the quarter. Set deadlines for yourself in your calendar to actually meet your goal activities. Keep yourself accountable by sharing with your manager what you plan to accomplish.
You can break down your numbers even further – by day. Use the numbers to your advantage to create a daily game plan. Continuing with the above example, you need to convert 2.5 leads a day (12.5 leads divided by 5 working days) to meet your weekly quota. What day-to-day activities do you need to accomplish to meet these goals?
It’s basic math, but this planning process is what many salespeople don’t do. They then become overwhelmed and stressed, “I only have one day to close X amounts of deals! How did I get to this point?” Planning in advance helps you avoid this difficult position.
Focus and act on the data
Proactively plan out your numbers and activities to determine how you can best meet your quota for the quarter.
This process applies to both sales reps and managers. It’s important that the sales manager creates a similar plan (just on a larger scale) so they know what their reps are doing and if they are going to meet their numbers.
And will you always meet your quota? Probably not. Some factors out of your control like C-level expectations will affect reaching your targets. But you should make every effort to forecast and plan your strategy so meeting quotas is a data-driven process rather than a hit- and-miss game.
Use your sales forecast as a trajectory. By knowing your plan of attack and following these steps, you can eliminate stress before it even becomes an issue at the end of a quarter. Don’t wait until it’s too late.