An economic recession is probably on the way, at least that is what more than two-thirds of economists think, according to a study by The Financial Times. While some companies are likely to take and wait-and-see approach, they may face cutbacks, loss of profits, layoffs and more.
Fortunately, sales managers can avoid these problems by acting now.
You can make sure your company is ready for a recession by developing an action plan for your sales organisation. This is a plan that focuses on investing in tools, training and effective sales tactics. This will not only protect you from the risks of a recession, but also prepare the organisation to take advantage of unique opportunities that arise during an economic downturn.
Here are detailed tips to guard against the chaos a recession can bring. These tips have been compiled by sales experts who have lived through it:
1. Focus on delivering value, not meeting quotas
Rumours of an impending recession have probably made your customers anxious. Instead of obsessing about meeting quotas, find ways to provide more value and support to your existing customers. Then they will know that their investment is worthwhile, and not disappearing.
Elyse Archer, founder and CEO of She Sells, says you need to start with the customer's need: "What can you change in your processes, systems and delivery to best serve them now?" Moreover, you can already address much of customers' concerns about their budgets by making simple changes to payment options and contract terms.
Donald Kelly, founder of The Sales Evangelist, had a few tips on simple ways to increase your value: "Can you change a three-year deal to a one-year deal? Can you offer a smaller package so the customer gets the help they need now and let the customer expand the package later?"
"If you are seen as the organisation that can help others now, you will get more orders," says Kelly. "Make sure you are seen as a company that is ready to help."
2. Retrain your teams
A resilient sales organisation can respond smoothly to changes in the market. But this is only possible if you invest in upskilling and retraining to ensure your team can handle the new roles or responsibilities that arise as your business adapts to changing market dynamics.
As Marcus Chan, founder and CEO of Venli Consulting Group, urges: "Invest in the skills of your teams so they can be successful regardless of market conditions."
Fortunately, this training does not have to be expensive. Juliette Evans, Learning and Development Business Partner for Close Brothers, uses Salesforce Trailhead to support continuing education for her teams. "We want to make sure our people have the skills and tools they need for success," Evans explains. "With myTrailhead, we can launch new training content in a matter of days."
To ensure you identify the right training topics as an economic recession approaches, you need to know where the bottlenecks are in your sales function. What stands in the way of achieving quota: a slow lead time, too many complex deals, a long sales cycle, an impediment in the sales process? Use these insights to create training modules with instructions and quizzes, examples or interactive activities to coach salespeople.
Also make sure this training is multifunctional. For example, train your account executives to handle basic billing questions so that customers don't have to go from one department to another. Practice a standard billing conversation and make sure they can answer important questions, such as: "Where can I see my bill and how can I pay it?" Consolidate your sales data in one CRM so account executives can access important billing data when customers contact you.
3. Set clear expectations for performance
One of the best things you can do as a leader is to set transparent expectations for your salespeople. Then they will know what needs to happen for the success of the company and what their role in it is. Much of this comes down to the basics: Make sure key sales responsibilities are well defined.
But it is not enough to tell people what to do. You have to show them they can do it, especially as an economic recession approaches. "Set clear guidelines for performance and cultural expectations, and then model them," says Chan. "Leaders need to be present and lead from the front."
For example, make it clear that you want your salespeople to double down on pipeline maintenance, ongoing training and alignment within teams. Then take charge by holding (and preparing) weekly pipeline reviews to demonstrate accountability. Make continuing education and training part of your own weekly tasks and synchronise regularly with other teams to show the importance of alignment.
When modelling these behaviours, make sure you give your salespeople what they need to succeed. "Keep coaching and supporting salespeople so they continue to perform their best and ensure transparency in all organisational changes," Chan urged.
4. Automate tasks for maximum efficiency
Automation can minimise risk, reduce human error and help you focus on tasks that create noticeable change. Sales managers like Belal Batrawy, head of GTM (Go To Market) at GTM Buddy, are implementing technology that helps salespeople focus on high-impact sales activities rather than manual tasks.
"We invest in automation. We invest in anything that allows us to automate steps in the marketing and sales funnel to get better results," Batrawy said.
When it comes to being ready for the economic downturn, automation, such as workflows, scheduled messages and automatic record updates from modern CRMs, can help you scale up your sales efforts without hiring more reps.
Whatever automation tools you use, they should be accessible and available to the whole team on the go. If you don't already have one, consider implementing a real-time messaging tool like Slack that integrates with your CRM. This allows salespeople to customise deals, schedule messages to team members and communicate with customers remotely, at home or from another remote location.
5. Don't forget the basics
When an economic recession hits, it can be tempting to immediately take drastic measures, whether that is adjusting your quotas or overhauling your sales processes. But drastic measures are not always the best solution. In fact, the best remedy for a new problem is often to revisit what made your business so successful in the first place.
"The best thing a sales organisation can do [during changes like a recession] is to keep the focus and basics under the microscope again, such as defining your ideal customer profile, target personas, territories, verticals, etc," Batrawy said.
Retraining salespeople in the art of sales calls and consultative selling, or returning to old, but effective, sales plays can also be good strategies to ensure your team closes deals confidently and efficiently, regardless of changes in the market. Review your data to identify call scripts, email templates and other tactics that have worked well in the past and take the opportunity to test them again.
"I have witnessed the ups and downs of our economy over the years. When a recession comes, it will be about going back to basics," also says Lori Richardson, president of Women Sales Pros and CEO of Score More Sales. "Focus on the work that needs to be done and keep the noise out."
6. Focus on support and welfare of representatives
Loyalty and morale can come under pressure in uncertain times. This is why Richardson encourages sales managers to focus on supporting and moving employees forward. Lori points out that sales reps go where they are valued, not merely tolerated. They might leave if they don't feel heard or empowered.
Offer office hours where salespeople can walk in or schedule calls where they can discuss their concerns. Give your salespeople time to rest and recharge after sales sprints at the end of a quarter. If you don't have the budget for big incentives, outings or team dinners, find creative ways to celebrate successes, such as with kudoboards or handwritten congratulations. Small thank-you notes can already go a long way to boost morale.
When a recession comes, it will be about going back to basics. Focus on the work that needs to be done and keep the noise out.
Lori Richardson, president of Women Sales Pros and CEO of Score More Sales
7. Admit what you know - and what you don't know
Economic recessions are complicated, and every recession is different. But for the people you lead, your responses need to be as clear as possible: They want to know they can trust you to do the right thing for the company and, in particular, for everyone in sales. That trust begins and ends with transparency.
"Be 100% open and honest with your team about what's going on in your organisation, even if that means saying, 'I don't know'," says Richard Harris, founder and CEO of The Harris Consulting Group. "You will gain more loyalty and trust from your team by acknowledging that you don't know if layoffs are needed or if targets will be adjusted."
8. Focus on what you have control over
Changing customer needs, concerns about inflation and the possibility of layoffs can give even the most optimistic sales managers the jitters. This is why it is so important to prioritise what you have control over. You cannot control the world's financial systems, but you can look at where your organisation is succeeding and where it is not. In either case, take the time to find the 'why' so that you can prevent deals from slipping through the cracks.
For example, if you notice that a deal gets stuck in the middle of contract negotiations, find out what deal changes occurred just before the last communication with the prospect. Based on the prospect's needs and requests, see if something does not fit, especially basic deal information such as pricing, contract duration and payment terms. Research the prospect to understand what is happening in his business that could hold up the deal. And if possible, ask the prospect for more information so you can adjust the deal.
"We lose deals because we don't ask the right questions, not because of the economy or a competitor," says Harris. "Dive into your sales process and exit criteria. If more than 5% of your deals go black, you need to know why and fix this. And if you don't know why, you already know what the problem is. That information should never be a surprise."
Prepare your sales organisation for any economic downturn
Budget cuts, layoffs, a staff freeze - pfff! These can rock any successful sales team. To avoid getting into trouble in an economic downturn, move from reactive to proactive and adjust your recruitment, pricing, processes and technology. This way, you can ensure that your sales organisation is resilient no matter what market shift comes along.
Source: Salesforce Blog