The promise of the new year lies ahead. One way to help ensure that it will be a profitable one is to re-evaluate your company’s pricing strategy. We recommend devising an approach that...Read more »
Listening to your Customers by Tracking Lost Sales
“Sorry, we don’t carry that item.” Or perhaps, “No, that’s not part of our service package.” How many times a year do your salespeople utter these words or ones like them? The specific number is critical because, if you don’t know it, you could be losing out on profit potential.
Although you have to focus on your strengths and not get too far afield, your customers may be crying out for a new product or service. And among the best ways to hear them is to track lost sales data and decipher the message.
3 Steps to Success
A successful lost sales tracking effort generally involves three steps:
- Get the data. Ask your sales associates to log every customer request and to question further to get at the heart of what they need. Train sales associates to record information such as the date of request, item requested, and the reason the item was unavailable.
- Crunch the numbers. Calculate how much you could sell if you had the new items in stock or offered the additional service. Naturally, you’ll need to bear in mind that meeting customer demand might involve spending money on equipment or personnel to expand your product or service line. Key data points to examine include:
- Estimated potential purchases
- Potential sales losses
- Estimated gross profit losses
- Talk about it. Run a lost sales report monthly and discuss the results with your management team. Seek to establish consensus on where your best strategic opportunities lie. Sometimes you’ll want to be patient and let trends develop before acting. Other times, you might want to strike early to seize an underdeveloped market.
A better grip
Lost sales are lost opportunities. By getting a better grip on your customers’ needs, you can build a stronger bottom line. Please contact The Fahrenheit Group for help creating and maintaining a lost sales tracking system that best suits your company’s distinctive needs.