Thursday, 28 January 2021
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SALES JOBS, SALES CAREER, CAREER CHOICES & CAREER COUNSELLING

Must Know Sales Terms

1. Client List

A salesperson's list of accounts and prospects they are responsible for is generally referred to as a client list. The term client is often viewed to be more sophisticated than simply using the word customer.

Having a well-established client list can provide an excellent opportunity for success with the products or services that you will be selling. It is important to understand as much as you can about the top accounts and the problems / needs that are present.

2. Cold Calling

The process by which a salesperson calls a list of prospects that they don't personally know in an attempt gain an appointment and eventually win their business and that party is not expecting their call is known as Cold Calling.

Cold Calling is all about picking up the phone, calling a prospect and creating a compelling reason why they should o learn more about your products or services. All salespeople must embrace the fact they must be willing to contact people that they, or their company, does not have a relationship with.

Some sales positions require more Cold Calling than others.

3. Elevator Pitch

An Elevator Pitch is a well-practiced, short description of your product, service, and/or company that is easy to understand and creates an interest in the listener to want to learn more.

This information should roll off your tongue quickly and be without hesitation. The real goal of any elevator pitch is to get the audience interested enough to say, "I get it. Please tell me more."

4. FUD

Fear, Uncertainty & Doubt, pronounced "FUD" is an acronym used to describe how salespeople use these three emotions to create a sense of urgency and/or action about the products or services they are representing.

Salespeople often use this sales tactic when the prospect’s perception of the product or service is that it does not require urgent attention today but could result in an emergency if left unattended or that buying a solution from the opposition may penalise them in some way.

5. Hunter v Farmer

The term “Hunter” is often used to describe a sales person responsible for finding and bringing in new business, typically a Business Development Manager (BDM) role.

The term “Farmer” is often used to describe a sales professional responsible for growing sales from existing accounts, typically an Account Management or Sales Representative role.

A Hunter / Farmer sales model is used in larger sales teams to keep an outbound salesperson on the road and in front of customers while the farmer acting in an internal capacity can maintain daily contact and support.

6. Open & Closed Questions

Questions that cannot be answered with a "yes" or a "no" are known in sales as open questions or open ended questions. They generally begin with the words - What, How or Why and usually encourage a prospect or customer to expand on a response.

As a result, open questions usually help the salesperson learn much more about the prospect or customer than a simple closed question.

7.  Products & Services

Products are tangible where as services are not. You can buy gold as a tangible product. You could then melt it in a furnace and use it to make electronic components or jewelry and then sell those products.

Financial service companies however, make it possible to exchange Gold Futures on the Australian Stock Exchange (ASX).  A future is a service with which you can hedge your risk. Most people trading on the ASX in futures will never see any physical bullion.

Companies differentiate in offering products and services, but the variations between similar products of different producers are less prominent than the variations between services.
A product is produced by a manufacturing process. A service is offered by the utility element of companies; you subscribe to a service in the same way that you subscribe to your gas and electricity supplier.

When a company purchases products, they generally fall under capital expenditure where as services fall under operational expenditure.

This biggest challenge with selling services is being able to differentiate the intangible.

8. PO Number

A Purchase Order Number or PO Number is the legal document from the buyer. The number assigned to the order is used to help track what is being shipped to the buyer for his or her inventory system and financial planning.

Getting POs is what sales is all about an they are considered an official binding commitment to purchase a product or service. A valuable lesson that all salespeople learn during their career is that a sale in NOT complete until the products or services are paid for and the money is in the bank.

9. Sales Forecasts

A sales forecast is the process in which the salesperson estimates the likely volume of sales, measured in dollars and units for a future planning period. Typically sales forecasting is done on the basis of past trends, sales force estimations, survey of consumer buying intentions, managerial judgment or quantitative models.

Salespeople with often argue that time spent on forecasting would have been better spent on selling however it becomes a necessity for business planning for items such as cash flow, inventory, and manufacturing requirements of the company.

Every company will have different philosophies and processes associated with forecasting.

10. Sales Quota

The sales quota is the expected level of sales for a territory or sales person in a given period. A sales quota may include dollar volumes, unit volumes, gross margin, net profit, activity levels or any other number of parameters.

Quotas are established to set expectations for sales revenue and unit sales. Sales Managers use quotas as measuring stick to determine the sales team’s effectiveness, ability to meet corporate revenue objectives and to drive sales of new products and services.

11. Sales Cycle

The sales cycle is defined as the time between the first contact with a prospect to when the sale is made. Sales cycle times and processes vary depending on the company, type of business, the effectiveness of the sales process and market conditions.

The sales cycle can vary from minutes, to months to even years. Sales cycles typically become longer as the products, services or solutions you are selling get more complex.

There are many different models for sales cycles depending on the company and industry but the flow tends to be very similar in each case: Plan, Prospect, Open Call, Qualify, Investigate Needs & Problems, Develop Needs & Problems, Demonstrate Value, Negotiation & Obtain Commitment.

12.  Sales Funnel

A Sales Funnel or Sales Pipeline describes the pattern, plan or actual achievement of conversion of prospects into sales, pre-enquiry and then through the sales cycle.

Prospects are said to be fed into the top of the funnel and converted sales drop out at the bottom, the extent of conversion success reflects the quality of prospects fed into the top and the sales skill at each conversion stage.

The salesperson must estimate his or her forecast for closing business for a defined period – weekly, monthly or quarterly. The term pipeline or funnel is a means by which sales managers and salespeople rank their winnable business opportunities.

13. Decision Making Unit (DMU)

The DMU can be a group of people (or just one individual) who are involved in the decision making and approval process for purchasing a product or service. The DMU in a company often consists of Influencer(s), Recommender(s), Decision Marker(s) and Approver(s).

14. Feature

A feature is an aspect of a product or service (i.e. colour, speed, size, weight, type of technology, buttons and knobs, bells and whistles, technical support, delivery etc.)  

15. Advantage

An advantage is an aspect of a product or service that makes it better than another. This is the selling factor over the product or service of a competitor 

16. Benefit

A benefit is defined as how the features and advantages of the product or service you are offering provides value to the customer from their perspective. This is usually measured as an increase in profits, reduction in expenses or saving in time and / or resources.

17. Customer Relationship Management (CRM)

CRM consists of the processes a company uses to track and organize its contacts with its current and prospective customers. CRM software is used to support these processes; the software system can be accessed, and information about customers and customer interactions can be entered, stored and accessed by employees in different company departments.

Typical CRM goals are to improve services provided to customers and to use customer contact information for targeted marketing.

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