Why it is time to ban annual sales targets

Annual sales targets are a terrible idea. It may seem strange to go against years of accepted sales practice. However, I have yet to meet anyone who finds the annual sales target useful, apart from accountants. Most sales people find an annual target something very hard to deal with mentally. It often seems like an impossibly big goal to achieve.

The trouble is that, if you have a seemingly impossible target, you are unlikely to be truly motivated to achieve it. By the time that people realise that targets are off-track, it is often too late to do anything about it. So, what is the alternative?

A three-month target is usually a much better plan. They are easier for everyone to manage. Companies that implement three-month targets have better control over their sales pipeline. They are therefore more likely to achieve their sales targets. Companies that stick to annual targets may struggle to achieve what they need to.

Three-month targets tend to work for three main reasons. Here is the first one:

More focused

Because the target is relatively short-term, people really can focus on one activity. You know exactly what you have to achieve and how to achieve it. For instance, you can decide to target one type of customer only. You can always use your next three-month target to change the market sector you wish to sell to.

An annual target is much larger. This means that, typically, you will have to carry out a number of different sales projects. If you are trying to manage all of these at once then it can be hard to carry them all out successfully. The focus of the target leads to another benefit.

More momentum

The deadline is always near in a three-month target. Everyone’s minds are therefore focused on success and achieving the target. In contrast, there are twelve months to achieve an annual target. It can seem as if you do not have to do very much to begin with. That can mean that you have lost the ability to achieve your target before you have even started work on it.

Over three months, people can see results and achievements more quickly. They retain their enthusiasm. So, they are likely to keep working at the target to make sure it succeeds. Naturally, things do not go right all the time. Even then, a three-month target holds the advantage.



Easier to react to

If you have twelve months to make something succeed, it can be too late when you realise that things have gone wrong. With a three-month target, you have a much better chance of quickly working out if things are on track or not. This means that you can re-plan activities if they are not achieving the right results. Or you can abandon a project early if it is not creating the right results.

What happens if you carry on to the end and do not achieve what you set out to? Hopefully, this will only happen to one of your targets. You can use other three-month targets to make sure that you remain on track for the full year.

Set your own targets now

Agree a highly-focused sales project. For instance, you may decide to win three new customers from a particular market sector and with a particular value. Set revenue and activity targets for the next three months. You can do this for yourself or for a member of your team.

Remember two important things. Firstly, allow for holidays. Secondly, make sure that people have an accountability partner to keep them on track. I am confident you will find three-month targets are a much better solution than an annual sales target.



If you would like practical ideas on how to engage with today’s buyers, download the free e-book Ten Common Print Selling Errors and What To Do About Them at www.profitableprintrelationships.com/e-book/. You will also receive regular ‘views from the print buyer’ bulletins, full of ideas on how to sell print effectively.

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