Step 1 – Don’t panic
Too often the first thing a business does when confronted with a decline in sales is to look for a shiny new thing to turn the business around. Stop. Think. If this shiny new thing was such a good idea, why was it not attempted when things were going well, and the business had the time and resources to do it properly? Still liking the new shiny thing? Then think about this: your staff and clients can smell panic, and will recoil from it – how are they reacting to you and the new shiny idea?
Step 2 – Find out what changed
All sales are the result of customer behaviour. Find out why your customers are behaving differently. The key question: are they buying less because:
- Their needs have changed
- They are buying from a competitor
- They have delayed their order
This understanding will help you to respond appropriately. If their needs have changed then it is important to find out if this is a temporary or permanent change and then consider if there is an opportunity to adapt to meet this new requirement. If they are buying from a competitor, then it is important to find out why you lost the business and what you need to do to win them back, (this could be a poor customer experience with you, issues with product availability, or issues with your brand). If they have delayed their order, it is important to be patient and use it as an opportunity to build the customer relationship.
A final note on this, it could be that the economic ecosystem you are operating in has changed. That the decline in sales is because the industry segment you are operating in is in decline. Rather than looking at this as a sales problem, you now have a strategic issue to address; How are you going to come out the other side of the downturn stronger? But that is a whole new topic to be covered later.
Step 3 – Review your current practices
Organisations don’t fall apart, they drift apart. Do a review of your internal processes, starting with sales and marketing and compare them to the best practice you set yourself. Inevitably you will find areas in which you can improve. This is where you unlock some potential and turn the sales results around. For example an early indicator of poor customer management is the inability of the sales team to accurately explain why their customers are behaving differently (outlined in step 2).
Step 4 – take a holistic approach
Now that you know what your customers want and how well you are meeting that need, it is time to review:
- What promise should you be making to the customer (Strategy)
- How to make sure you keep that promise profitably (Operations)
- How to communicate the promise to current and potential customers (Sales and Marketing)
Done in a calm and rational manner this will ensure that you are thinking clearly about your future and taking the right offer to the market. With everyone on board you can now implement this plan.
A tip on this, don’t wait for sales to go bad to take these steps.