October 9, 2015 — Top performing industry professionals have long held that any sales center producing a net closing ratio (CR) below 30% is surely underperforming. Actually, a 60% net CR would be approaching peak performance but for now I’ll use the 30% threshold and demonstrate what any developer anywhere can do to immediately increase their net sales volume. Absent hyperbole, based on documented sales center stats and without one penny in upfront cost any ‘decider’ who doesn’t do the following is someone who surely loves to lose millions and millions of dollars.
So Here’s The Scoop: In every sales center around the world there are the top producers (liners, closers and/or front to backers). They are the crème de la crème. They are true sales professionals thoroughly skilled in their vocation and the Pros I’m talking about are of the low-maintenance well-balanced variety who sell clean (no heat/lies) business-day in and day out like clockwork.
And unlike the majority of their specific sales team counterparts the highly skilled top performing ‘Aces’ I’m talking about write fully processable deals at ratios two or three times (+) higher than the majority of the other reps do on the same team, meeting/greeting, I might add, the same caliber of sales guests.
The simplicity of increasing any timeshare sales center’s sales volume is not cloaked in or part of some deep dark mysterious secret which is only accessible by mystics, palm readers and/or other supernatural types. And increasing sales volume requires no smoke or mirrors and indeed can be accomplished quickly and, again, without additional upfront costs to the developer.
But let’s talk about money, by which I mean the net sales volume on clean business produced by four different sales centers operating in the same region. These sales centers all meet/greet 25 qualified sales guests each day. Each sales center has the same minimum annual household income requirement and each guest has one or two credit cards in their possession. All 4 sales centers are open for business 360 days a year and each team produces an average contract price of just $12,000.
Sales Center ‘A’: 9,000 sales guests: 15% net closing ratio generates 1,350 contracts and an annual sales volume of $16,200,000 which produces a net VPG of $1,800.
Sales Center ‘B’: 9,000 sales guests: 20% net closing ratio generates 1,800 contracts and an annual sales volume of $21,600,000 which produces a net VPG of $2,400.
Sales Center ‘C’: 9,000 sales guests: 25% net closing ratio generates 2,250 contracts and an annual sales volume of $27,000,000 which produces a net VPG of $3,000.
Sales Center ‘D’: 9,000 sales guests: 30% net closing ratio generates 2,700 contracts and an annual sales volume of $32,400,000 which produces a net VPG of $3,600.
Obviously Sales Center ‘D’ is generating $16,200,000 more sales volume every 12 months than is sales center ‘A’ and center ‘D’ is doing so with the same number of reps, in the same amount of time with the same quantity and quality of sales guests and pretty much selling the same or an equal product (timeshare vacationing plan) as center ‘A’.
And speaking of money, that is a difference of about $311,600 each and every week which in just 24 months adds up to a $32.4 Million difference. The difference in 36 months is $48.6 Million, 60 Months becomes $81 MILLION – and it just gets worse and worse.
Naturally the difference does not include the loss of interest payments, the annual maintenance fees or the money all those additional owners/members would have spent at their ‘home resort’ over the years, most of which goes into the developer’s coffers.
Improving, approaching and achieving maximum sales efficiency all begins with the mindset of the developer. And then that developer needs to change (or replace) the mindset of their various management ‘heads’ in their sales and marketing departments and then retrain or replace underperforming sales (and marketing) reps with top producing professionals.
In other words, operate like sales center ‘D’ and not like sales center ‘A’.
And as for those “professionals” – there are more than enough to go around but they have to be lured (induced) to drop by the developer’s company and have a chat with the person in charge of hiring the best talent whether from within or from outside our industry.
It’s all so simple and any developer who settles for anything less than at least striving to reach maximum sales (and marketing) performance is sadly losing more sales volume than they are generating.
And yes, most developers are playing the numbers game and they’re doing quite well for themselves even though their marketing and sales operations are underperforming. But, geez, if they’re going to play anyway why leave that kind of money on those magical little round tables?
To my way of thinking doing so makes no sense at all because everyone from the developer all the way down the food chain is losing gobs of money every day!
Good Luck Out There
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