By Dave Kahle

Quality Sales Calls

Q.  How many appointments or conversations per day or per week should a sales person make in order to be successful?

A.  I have no idea.  How’s that for an answer that you’re not expecting?

OK, you know by now that doesn’t mean I don’t have anything to say to this point.  Let me explain my first statement.  I have no idea because I don’t know the specifics of your selling situation.  The definition of a reasonable number of appointments varies tremendously from one situation to another.  For example, I have worked with phone salespeople who are expected to have 50 – 60 conversations per day.  On the other hand, in one of my personal selling situations, I regularly spent a half day with one customer.  And that one account probably bought more from me than several hundred of the phone sales accounts.

Which really hits to the heart of the issue.  The factor that most determines a reasonable number of appointments is the potential dollar value of the sale.  Generally, the larger the potential dollar value of the sale, the fewer calls should be made.  That’s because the nature of the sale requires more in-depth relationships and more involved sales dialogues.  Each sales call is more complex and takes longer.  Therefore, you can’t make as many calls.

On the other hand, the smaller the potential dollar value of the sale, the more calls should be made.  The phone salespeople, for example, were selling safety videos for about $100.00 each.  Because of the relatively small order size, they would need to make many times the number of sales calls that I did.  I was selling hospital supplies via 12-month contracts.  A typical deal would be worth $20 – 60,000.

So, the first thing to consider as you strive to develop some quantifiable expectations is the potential dollar value of the sale.

The second thing is a variation of the first.  In order to be profitable to the company, each salesperson’s total costs must fall within a certain range.  We’ve done extensive research on this, and I can give you a broad rule-of thumb.

I believe that, generally speaking, a salesperson’s total cost to the company should not exceed 25% of the total gross profit produced by that salesperson.  For example, let’s say that you have a salesperson who makes $50,000.  When you add in the cost of expenses, fringes, and taxes, the salesperson actually costs you $68,000.  So, if you use the 25% rule-of-thumb, that salesperson should bring in at least $272,000 in gross profit in order to be profitable to you.

By the way, if you’d like to dig into this issue more deeply, download a free copy of “How to Kreate Kahle’s Kalculation.”  That will get you a free PDF that describes this calculation in detail.

Armed with this calculation, the next question is, “How many sales calls does this salesperson need to make in order to generate $272,000 of gross profit?”

That will help shed some light on the subject.  One caveat – the 25% figure really is a very broad rule-of-thumb.  I know of some cases, like sub-reps for independent agents, for example, where the number could be higher.  And, for many industries, like wholesale distribution, I advocate a much smaller number, like 13 – 17%.

Another thing to consider is past history.  If you’ve been in business for a while, you should have some sense of how many calls or appointments it takes to be successful.  If you haven’t tracked that number, it may be a good exercise to track it for all your reps for a couple of months, and then to use that as a guideline.

Having said all of that, let me say one more thing.  I don’t think the number of calls is an important issue for most salespeople.  It does have some application for a new salesperson to guide that person to an appropriate level of activity.

After that, however, there are other measurements that are more important.  More important than the number of sales calls made is the quantity and quality of sales opportunities unearthed.  In other words, if your salesperson can uncover $1,000,000 worth of viable sales opportunities in five calls a week, more power to him.  If another makes 25 calls to uncover the $1,000,000, so be it.

Figure out what a viable quantity and quality of opportunities per salesperson is and track them.  It’s closer to the mark than calls. The number of calls measures the amount of raw activity in which your salespeople engage.  The quantity and quality of sales opportunities measures a more significant thing — the amount of worthwhile activities in which your sales people engage.

Copyright MMX by Dave Kahle
All Rights Reserved

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