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Sales goals: why you need them

  • Blog
  • 22 September 2016

What comes to mind when you think of setting sales goals? Instinctively, you might be inclined to say ‘we want to increase sales.’ Doesn’t everyone, in fact? Any business that didn’t seek to grow sales wouldn’t be around for long. However, setting such a vague sales goal as ‘increased sales’ is likely to have the opposite effect.

Without a clear goal to aim for, neither you nor your sales team have anything to measure against, so you are not able to judge progress. Without assessing your progress, you cannot tell if your strategy to achieve these goals is working. Your sales team, not knowing what they’re working specifically towards, are likely to lose momentum, enthusiasm and engagement, leading to a potentially greater decline in sales than would have occurred without setting any goal at all.

Sales goals: why you need them

Every firm’s sales process is unique, responding to the specific make-up and needs of its customers. Also, each of your sales representatives has their own approach and style to sales. With so many different variables in play, as anyone in charge of a sales team knows, it’s vital that sales activity is directed by clear goals. Only this can ensure that the whole company is pushing towards the same end, and with the appropriate amount of effort.

It’s important to set clear and obtainable sales goals, that give your sales teams tangible targets to work towards, and help you to achieve your broader business goals.

Be SMART about it

The SMART system is an easy and effective way to do this. SMART stands for Specific, Measurable, Attainable, Realistic, Time-based. This is the litmus test by which your goals should be evaluated. As we can see, the goal of ‘increased sales’ doesn’t meet any of these standards.

Read on and we’ll examine the SMART system in more detail - how it can be used to improve your sales effectiveness and help you to adjust approaches as required. We will also consider practical ways that you can use to set goals that meet these standards.

SMART goals for business success

The SMART system helps you to summarise every facet of your performance expectations, including practical, quantifiable, predictable and observable elements. By spelling out your goals in this way, your sales team and wider firm will have no problem putting them into action.

S - Specific

You can’t aim to achieve a goal if you don’t know what that goal is. Telling your sales team that the firm needs to ‘increase sales volume’ doesn’t explain by how much, for example. By setting a clear level or number, your team has something specific to work towards. An example would be ‘we aim to increase sales volumes by 20 percent.’

M - Measurable

Setting measurable goals for sales means having a quantifiable outcome. How much revenue do you seek to bring in every week, month and year? By setting a measurable pace of output in pursuit of your goals, you can check at intervals whether or not you are on course to fulfill these goals. For example, ‘Over the next year, we will increase sales to new customers from 300 to 500 units per month’.

A - Attainable

Your sales goal is attainable when you have the capacities to achieve it. These capacities include skills and abilities, staff numbers and motivation. A good non-business example is to say ‘I want to be a black belt in karate in one month’. Earning a black belt requires going through a series of steps, each of which has its own requirements, so this goal is not attainable. Your own willingness is also an issue concerning attainability of goals. Are you willing to do everything necessary at every point to achieve your sales goal? A Herculean effort for two months that starts to tail off may not be sufficient.

R - Realistic

This is a similar category to attainable, but with a stronger focus on the practical ability of your company to achieve the goal. Doubling your sales figures in a year would be great, and may be possible under certain circumstances, such as with a massive injection of capital, but without that, the goal is not realistic. Setting unrealistically high targets doesn’t motivate people. In fact, it does quite the opposite - when goals are impossible to achieve, your staff will wonder why they should bother at all.

T - Timely

Goals cannot be open-ended, or you’ll never know when they have been achieved! Setting specific timeframes for achieving your goals, with intervals to check for progress and redefine those goals as necessary, helps to keep you motivated and focused on the task at hand.

Here’s what a SMART sales goal might look like: ‘By this quarter’s end next year, we will have increased our sales volume by 35 percent on this quarter, having reached a 20 percent increase in next six months’. Ultimately, you will get tangible results by focusing on what you can achieve, not on things that you can’t.


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