Many representatives and heads of small businesses who take on this role rely primarily on good relationships with their customers to make sales. While this aspect should not be overlooked, it is actually a limiting belief. Harnessing relationship capital shouldn’t be the only way to make sales!
Here are the 3 main risks generated by sales development based mainly on the interpersonal skills of representatives.
1. Negative impact on the value of the company
If you own a business and think about selling it to yourself one day, the potential buyer will most likely ask: “What will ultimately determine the value of the business when it is mine?” “.
If the current owner relies on their good connections to grow the business, it can easily be assumed that their growth will decline after they leave. In the same vein, an organization dependent on its seller-client relationships also represents a risky situation for a buyer. The latter will have every reason to fear a significant drop in sales and therefore in the value of the company if one or more representatives leave it.
To ensure good value for a company and its sustainability, the performance of the sales force must be reproducible . A good customer relationship, although it is an asset for the seller, remains a risky variant, since it can hardly be reproduced.
Since people skills are not representative of the value of the business, it gives the impression that its growth does not depend on the quality of its products or services, but rather on the people who bring them to market.
There must always be the potential for organic growth to support the value of a business , which is achieved with a reliable AND repeatable sales process .
2. Lack of control over sales
When the sales force is focused on the quality of customer contact, the predictability of sales and revenue is complex to control, as is the length of the sales cycle.
We know that human relationships are unpredictable. We cannot therefore predict purchasing behavior with accuracy and reliability. When the key element of a sale is this random, the customer is left with all the leverage. If he makes his purchasing decision based on his appreciation of the representative… income difficult to guarantee!
The sales cycle is also subject to the buyer’s will and therefore difficult to control. For example, it becomes tricky, if not impossible, to give the client a shorter cooling-off period in an attempt to shorten the process, as the relationship could suffer. And if we rely mainly on the quality of it to achieve our sales targets, we cannot take that risk.
When the company is taken hostage …
In such an ambiguous situation, leaders often feel backed up to the wall. The organization becomes dependent on the quality of the relationship between its salespeople and their customers, and therefore the salespeople themselves. What happens if the representative needs to be replaced? A business manager could therefore prevent himself from optimizing his sales force for fear of losing his good customer relations. It is a further form of lack of control, which prevents company management from seizing certain recruitment opportunities.
3. The difficulty of recruiting the right people
By basing the selection of new salespeople on their contacts, you can expose yourself to hiring errors. In my practice, I have seen many cases of reps hired this way with disastrous results for businesses. You should know that the relationships of a representative in a given company are in no way a guarantee of his future success in a new organization , even if it is in the same sector of activity.