Example of sales strategy for start-ups and small businesses

It doesn’t matter how great your products or services are, how competitive your prices or impressive your brand, if you don’t make enough sales your business could fail.

And you don’t take a considered, structured approach to selling, your business may not maximise its revenue. The answer is to have a reliable sales strategy. This ensures that you sell the right things to the right people in the right way and make the best use of your resources. Using a joined-up approach can help deliver the sales your business needs to make.

What is a sales strategy?

A sales strategy is a plan that explains how your business will sell its products or services. It maps out your approach. A sales strategy identifies which customers your business plans to target, what it will sell them and what sales channels you’ll use. It will map out how you’ll ensure that customers will buy from you so that you achieve your business objectives.

A sales strategy includes a mix of products/services and sales channels that target different customer types – known as market segments – by employing various sales tactics.

For your sales strategy to work, your knowledge of your customers and competitors must be thorough. If not, carry out up-to-date market research first. Otherwise your sales strategy might not target the right customers or it might try to sell to the right customers in the wrong way. And if you don’t know what your competitors offer, how can you know that your products and services offer greater value?

Without a reliable sales strategy, you risk wasting time, energy and money. Moreover, your entire approach could be wrong, which means you won’t make enough sales to survive and grow. How you market your business to attract and retain customers is hugely important, too, which is why many businesses develop a combined sales and marketing strategy or plan.

How to create a winning sales strategy

Step 1: Set clear strategic objectives

Having key sales targets is essential, whether total revenue or unit sales, usually for a quarter, six months or year. Such figures may already be detailed in your business plan or sales forecast.

Are you aiming to achieve turnover of £50,000 in your first year? Perhaps it’s £2,000 of sales per month or £10,000? An existing business might seek to increase its historic monthly sales by 2% or 20% by the end of the year. A business might seek to attract two new high-value customers every six months or 50 lower-value customers a month.

Your objectives should always be SMART (specific, measurable, achievable, realistic and time-bound). If you don’t have clear strategic objectives, how can you hope to accurately judge how good or bad your sales have been?

Step 2: Define your target customer

Successful businesses know which customers to target. Trying to appeal to everyone can mean you end up appealing to none. When you’re a new or small business it can be wiser to focus on a small market segment and tailor what you do to serve that niche.

Before putting together your sales strategy, make sure you know the answers to key questions about your target customers. Who are they and what do they want? Where are they based, what do they buy, when and how? How much do they spend? What characteristics, behaviours and attitudes link them? What do they dislike about other suppliers? Crucially, if you’re an established business – why do your customers buy from you?

Many B2C sellers create buyer personas – a fictional customer character – while B2B sellers may have ideal buyer profiles so they can better focus their sales and marketing. This can prevent them from wasting time and money trying to sell to customers who are much less likely to buy from them.

Any successful sales strategy must focus not only on acquiring new customers, but also retaining existing customers and ensuring their loyalty. It’s easier and cheaper to sell to existing customers. And you’re unlikely to grow if you have high customer churn.

Step 3: Decide your sales channels

A sales channel is how you sell to customers, and there are various options, with many businesses using at least a couple. You can either sell directly to customers or indirectly. When selling directly, your options can include selling face-to-face, via your website or online marketplace sites such as eBay, direct mail, telesales, catalogue and email.

Many businesses sell indirectly via intermediaries such as wholesalers, retailers, dealers and overseas distributors. Other businesses license sales of their products or services. Alternatively, a non-competing business may sell your products or services for commission or in return for you selling theirs.

Step 4: Choose your sales tactics

Your prices might change for different sales channels (such as lower pricing for online sales), or for sales made at different times of the month or year. You might decide to offer bundled products or two-for-one deals to make sales when demand decreases. You could give your customers money-off deals to reward their loyalty.

Don’t focus just on attracting new customers. Find ways to retain customers and get them to spend more. “Upselling” is a popular sales tactic. It means persuading customers to buy “add-ons” or a more expensive, upgraded or premium version of a product or service, while “cross-selling” means selling an additional product or service to existing customers.

If yours is a new business, you may think you know which customers you should target and how to sell to them, but you could be wrong. Your mantra should be “test and measure; test and measure; test and measure”. To avoid costly mistakes, find out before you roll out a grand sales strategy.

Your assumptions may be wrong or your products or services could appeal to customers you hadn’t envisaged. People might prefer to buy from you via sales channels you didn’t plan to use. Revisit your sales strategy every quarter to make improvements where possible. Do more of what works, and stop doing things that don’t.

How can a start up or established business go about creating a sales strategy?

Sales strategy example 1

New street food business
Before starting up, the new business owner carried out market research in town. Office workers on their lunch breaks revealed themselves to be the target customer, reacting most favourably to the idea of being able to buy Indian street food for lunch, also confirming best location (public square near large corporate offices) and trading times (11am until 2pm, weekdays only).

Local office workers liked the menu selections they sampled and thought £5 average price per item offered good value. Adding a bottle of water (cost price 20p; 80p profit) would enable the owner to make more margin with a £6 meal deal. To encourage their loyalty, customers could claim a free £2 side order with a stamped loyalty card, proving three previous meal-deal purchases.

However, weekly lunchtime sales could only generate 70% of the sales required to achieve business plan aims, so the owner needs additional sales channels. To increase revenue they start catering for weekend weddings, and a popular artisan food event in town each month.
With overall sales still lower than forecast, the owner targets the 20 biggest corporations within one-mile of their lunchtime pitch, offering early evening deliveries. The owner also contacts corporate events managers offering corporate event catering. Together, these strategies bring the required 30% uplift in monthly sales.

Sales strategy example 2

HR consultancy start up

Identifying a gap in the market, a new HR consultancy decides to start offering affordable HR support to local micro businesses with fewer than ten staff. These are unlikely to have their own HR manager, yet are reluctant to outsource their HR or pay the fees of a larger HR consultant.

In its first year, the new HR consultancy aims to agree £1,000 monthly deals with 15 businesses (£15,000 a month) to achieve an annual turnover of £180,000 (providing a wage of £60,000 a year for the business’s two partner directors). In addition, they plan to sell downloadable HR document templates online (an additional channel), forecasting sales of £1,000 a month.

They try to attract customers through social media and search engine marketing. They produce a weekly blog, which generates leads, as do self-made HR videos promoted via YouTube, LinkedIn and Facebook. A strategy of email marketing and telephone marketing to target businesses leads to one appointment every 30 mails/10 calls. One-in-four of these leads to a sale.

New customers can get a 10% discount for the first three months. Key to the new HR company’s sales strategy is giving 20% commission to local accountants and law firms if they refer a lead that becomes a customer. They are members of their local chamber of commerce and regularly attend local events and meetings, partly to try to meet new leads.

Sales strategy example 3

Established manufacturing business
In the past three years annual sales have declined by 6%. A new sales strategy is required to transform the business with annual sales growth of 10%. Until now, the manufacturer’s core customers have been UK SMEs. Underpinning the new sales strategy is targeting SMEs in Germany. A strategic objective of selling products worth £200,000 to German buyers in the next six months is set.

The UK manufacturer has to decrease its margins to cover export costs and offer a competitive price, which means having to sell 10% more units to achieve the same value of sales.

As part of its sales strategy, the UK business recruits a new salesperson who is a fluent German-speaker. They find leads in Germany using LinkedIn and attend major trade shows. Leads are followed up with contact by telephone, arranging face-to-face sales appointments. Following slow progress, the UK manufacturer’s sales strategy shifts, to instead sell through a distributor based in Germany, which proves more successful.

 

 

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