We Have To Invest In Revenue Generation
A key goal of most businesses (profit and not for profit) is revenue generation. After all, without revenue, the business can’t exist. I often talk to entrepreneurs and small business owners about sales–specifically, “How do we afford sales people, how can we afford to invest in sales?” There’s lots of bad advice out there, plenty of people with advice on how to sell for free—I ranted about this yesterday in Can You Afford Not To Invest In Sales?
I’m often surprised in speaking with entrepreneurs and small business owners. They don’t hesitate investing in product and service development, they put in place capabilities to deliver products—whether it’s manufacturing (or sourcing manufacturing), service delivery, whatever. They do it within a framework they can afford and fund. Somehow though, when it gets to generating revenue–selling, they aren’t prepared to make an investment, they look for ways of selling for free. They often have the field of dreams approach, “build it and they will come.”
If you want to grow your business, the field of dreams strategy is not likely to succeed. If we expect to grow our businesses, we need to be purposeful in developing and executing our revenue generation strategies. We need to invest in selling. This doesn’t necessarily mean hiring a sales person–but it does mean making investments.
We can look at investing across several dimensions: Time, Resources, Money. Our investment in selling has to be some combination of these three elements. If we don’t have the money to invest in hiring a sales person or a sales force, we trade off that by investing time and resources. Often, as a small business owner or entrepreneur that means we have to invest our own time in selling and revenue generation (we are the “resource.”) When I tell entrepreneurs or small business owners this, you can see the look of terror (or sometimes disdain) in many of their eyes—”You expect me to sell? You expect me to go to the dark side? I couldn’t possibly be a sales person?” My response is, “If you can’t or won’t do this, then you have to find someone who will,”–that requires an investment.
Whoever it is, the major component of the investment is their time-and it probably needs to be a good portion of their time dedicated to selling. It will also mean some level of funding–perhaps training, certainly in tools, in programs (demand generation, materials/collateral, web support, travel, etc.), and usually that investment requires money or funding. Protecting the person’s time–whether it is the business owner or some other person in the business is critical. Like any job, sales requires time. Expecting people to fit it in is a sure way to disaster. Things always come up to divert people from these “collateral responsibilities.” Even if the person is thinking–trying to figure out what to do, we need to commit time to selling and protect that time religiously.
Choosing who “sells” in your company can’t be the person who draws the short straw. While they might not be a “sales professional,” they have to be committed and enthusiastic about doing the function. There are plenty of ways to pick up the skills, but if they aren’t committed, if they aren’t enthusiastic, if they don’t have a passion for working with prospects and customers, helping them solve problems, they won’t be successful.
Too many small business owners or entrepreneurs say, “I can outsource the sales function.” It’s a valid point–often, we can find reps or resellers can are skilled and can invest the time in selling our products. Often, we pay for these services only after they have produced orders. It can be a good solution, but it’s not free (or cash deferred). To be successful in leveraging a channel we have to invest–time, resources, money. We have to train and develop our partners, we have to show them the path to success in selling our products, we have to provide support–both in materials, programs, and tools. We have to help in demand generation. Most of all we have to invest our time—we have to manage and motivate our partners. We have to make sure each partner sales person wakes up every morning wanting to sell our products–not just be willing to accept orders for our products. We have to direct them to the right customers, coach them on being successful, look at their account, and territory plans. Like any sales person, we have to manage, coach and develop them. Without this investment, the channel will produce very little–certainly not the level that we hope they would.
Our product or services may not be channel ready or channel friendly. Partners usually aren’t great pioneers. They usually aren’t great for selling brand new technologies. They want a roadmap to success–they are willing to work very hard in executing it, but they need to have that roadmap. If we don’t have that, if we can’t clearly describe the ideal customer, the selling process, the competitive environment, and how to develop, communicate and deliver value, they are unlikely to be successful. If we, as business owners or entrepreneurs, don’t understand that, then our investment in our channels may not produce the desired return.
We can always decide to hire a sales person—again, we are working the balance of investing time, resource, and money. Our investment in the sales person isn’t just their salaries and commissions. It is our time in developing, coaching, leading, and managing them.
Revenue generation, selling is not free. Even if what we are selling is free. Revenue generation requires an investment. We’re concerned about affordability, but the investment is not only money. We need to invest time, resources, and money to generate revenue. Anyone suggesting otherwise is probably trying to separate you from your money.
Are you investing in your future? Are you investing in generating revenue? Is the level of investment you are committing sufficient to achieve your goals? Revenue is not a result of wishful thinking. It’s the result of purposeful plans and investments.
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