The fundamental equation of sales (part 3) - The Rock Solid Case Study

Case study no. 2 (The "Rock Solid" case) for the "Fundamental Equation of Sales":

Educational and Training Services Sales Department

X=T/(H*ARPU*N)

Lets say your monthly Sales Department Target is T=90,000 USD according to the budgeted income.
Your department's Hit Rate is H=10%, meaning your Department's consultants / account managers sign 10 contracts for every 100 visits they report.
Average Rate Per Unit is ARPU=3,000 USD. This is the average value of a signed Educational and Training Services contract.
Number of consultants / account managers in your department is N=4.
In this case X (the number of necessary visits per month per consultant) becomes:

X=90,000/(0.10*3000*4)=75 visits/month/consultant

Still good news! 75 visits per month means an average of 3.75 visits per day, round it to 4. This rate allows your consultants to properly prepare every detail of their consultative sales visits but not in the relaxed manner as in Case Study no. 1. Keeping in mind that on an average, a consultative sales meeting should not take more than 1.5 hours (which is very long!), there is one hour, maximum two hours left for your consultants to prepare everything they need for their meetings.

You will need perfect activity planning, very dedicated consultants and a great team spirit among your team. Why? Well, because you and your consultants are facing a tough job and you need to be supportive to each other. Otherwise, because of the very close limits your team morale could hit the ground and from that point there is even more work to be done.

What can you do from this point? In my opinion you have 2 key points where you could make a difference: 1st. The hit rate and 2nd. ARPU

In future posts I will treat each one separately and in detail because this is a battle many managers lose. They tend to overwork their consultants and add unnecessary pressure on their teams and the breaking point is not very far from there.

This is why I call this case the "Rock Solid" case. Rocks are tough and hard but they do brake at excessive pressure.

Questions:
1. Is your Sales Department in a similar situation?
2. How do you think you can influence the Hit Rate of your consultants?
3. How do you think you can influence the ARPU of your department?