More insurance and financial professionals than I ever expected showed up for my webinar last week on Business Planning for 2013.
But I was even more surprised, in talking with attendees in the days that followed, to learn how many of these professionals could not answer basic questions about their essential numbers.
Whatever field you’re in, you have to start with the end in mind. Your goal doesn’t necessarily have to be financial, but let’s use a financial goal as an example:
Let’s say you want to earn $100,000 this year.
Now, you can’t really plan how you’ll reach that goal unless you know your other essential numbers:
~How many times do you have to pick up the phone and initiate a call (how many “dials”) before you reach people live (make “contacts”)?
~How many of the people you reach will be willing to set an appointment with you (“sets”)?
~How many of them will actually keep those appointments (“kept”)?
~How many of those who keep an appointment with you will eventually become clients (“sales”)?
~What are your average earnings per sale?
If you know these basic figures, you can plan your business activities for the year. For instance, if you want to earn $100,000 and you average $2,000 per sale, you need 50 sales to reach your annual goal. If you’re planning on working 50 weeks out of the year, that’s an average of just one sale per week.
If it takes you 3 kept appointments to make one sale, and you need to set 4 appointments in order to have kept 3, you need to make contact with enough people to set 4 appointments. If it takes 10 quality contacts to set 4 appointments and at least 25 dials to make 10 contacts, then 25 dials should get you the 4 set appointments you need. If you work a 5-day week, that’s just 5 dials a day.
Assuming you have people to call, all you have to do to make $100,000 this year is to pick up the phone and dial your qualified prospects at least 5 times each 9-to-5. Of course, if you’re cold calling or not getting great referrals, that 5 dials might be more like 50. If your average sale is significantly smaller, you’ll need more sales, so you’ll need to increase all of the other essential numbers in your model.
You can create any ending you want for 2013 if you make use of your essential numbers and figure out what actions you need to take to reach them. As you begin to improve those numbers…setting more, keeping more, converting more contacts to clients and getting bigger sales, the amount of activity required to get to the same result will shrink. In the meantime, keep REACHING…