Why are sales so important?

Certain words bring to mind the idea of business. Customers, products, and the key word of ‘sales’ are all words which make you instantly think of business. The idea of sales is almost synonymous with business. In any business organization, sales is the department that generates revenue. No matter how good your operation is, how cutting-edge your technology is, how tight your financial goals are or how progressive and forward-thinking your management techniques are, you must still have a great sales mechanism in place, or everything else is useless.

In my view Sales is still the most important role in every business. Let me explain why:

1. Cash flow is the ‘life-blood’ of every business.

One of the key aims of senior management is to try, where possible, to increase control and predictability of the business. Almost all operational planning begins and ends with the budgeting process, and all budgets are derived from the sales forecast. That is, how many units can be sold during the period? And at what price? The combination of these two questions is what constitutes the ‘top-line’ revenue projection, and this number effectively dictates how the entire business will be planned and operated throughout the ensuing period. Therefore, it is difficult to find a more important role than that of the sales in enabling the entire business to be planned appropriately.

2.  All business planning begins and ends with the sales forecast.

One of the key aims of senior management is to try, where possible, to increase control and predictability of the business. Almost all operational planning begins and ends with the budgeting process, and all budgets are derived from the sales forecast. That is, how many units can be sold during the period? And at what price? The combination of these two questions is what constitutes the ‘top-line’ revenue projection, and this number effectively dictates how the entire business will be planned and operated throughout the ensuing period. Therefore, it is difficult to find a more important role than that of the sales in enabling the entire business to be planned appropriately.

3. “Nothing happens until someone sells something” (Henry Ford).

There are actually only two roles across every business, in every industry, globally. If you are not a sales person then you are sales support. That is, your role exists to support sales. I can already sense people bristling at that comment, but like it or not, every other business function is redundant if the sales team fails to sell and generate the all-important income and cash flows.

This point was brought home to me in one of my early roles as Regional Manager working with for a Health and Fitness chain. Despite phenomenal early stage success, the business had been through a tough couple of years and sales performance was down across the board. I will never forget the first morning of a companywide meeting called by the newly appointed CEO.

He opened the conference with the following demand: “everyone in the room that carries a sales target please stand up”. I sheepishly stood up, along with the rest of my sales focused colleagues, thinking that we were about to cop a serious blast from the CEO about the poor membership sales numbers. Instead the CEO went on to say something that had a profound effect on me. He said, “now for all of you that remain seated (IT, marketing, HR, Finance, Operations etc.) your sole purpose in this business is to support the people that are standing up – your roles only exist to support the sales people – so make sure that you take a look around this room at the people that are standing up, and start supporting them in everything that you do”. I was both dumbfounded and at the same time delighted. Finally, a senior leader that understood the importance of having the entire organisation focused around sales success – which is by the way, really just a by-product of customer success.

4. Product-Market Fit

It doesn’t matter if you’re selling a product or a service, sales indicates if your company has purpose by addressing a need. No sale means that something is wrong. Either your product or service does not meet a need, or your marketing is not promoting the product/service correctly, or the sales process should be adjusted, or….the list can go on and on.

Business owners and entrepreneurs will always have a unique view on sales. There will debates about what level of prominence sales has in a business and how much emphasis there should be on it. Business owners will also constantly strive to make sure things are even in their company. Whether you see sales as the superstars of growth or just a regular part of business, there is no denying the importance sales has on your business and ultimately your life.

I can however, tell you that super successful businesses – you know, the ones smashing out the park – have sales people that are professional, well-compensated, supported with a strong marketing effort and empowered to act, serving key client interests with marketing support, money and time. They have strong personal relationships with key customers, or they learn how to build them.

What does your business like?