Common Mistakes a Business Makes:

Mistakes with sales personal: What most companies do is tie up their sales personal to closeout old inventories that did not sell in the first place. It is a natural discussion for a business, but the wrong one. This choice actually ends up costing the business sales and profit dollars. Mathematically, this can easily be proven out. For example: Sally brings in $20,000 in sales per week at “full mark up”. For argument sake we will say that the mark up is keystone. The company has some closeouts that they need sold. She is obligated to sell the closeouts for the business so “her point of focus shifts” to satisfy the companies new position to sell the closeouts. So she contacts all her accounts to push out the closeouts and then starts the follow up process of sales. Her normal sales drops the first week do to the shift. The following week her sales start to pick up but the dollars even if she is still at $20,000 per week the dollars are at deflated prices (10% mark up). The cost of the closeout sales from Sally are easy to calculate the business just lost $9,000 profit dollars and in most cases spent to market the closeouts Sally’s salary plus OH dollars to do it. It is needless to say how this choice affects the image of a business with their clients.    Over the years I have watched perfectly good sales personal turned into off price sellers and this usually happens with the best of the sales group. The out come of this discussion is lower overall profits in addition to spoiling the sales team.