Sales Planning: What is it and how to create it? A complete review

Imagine if your business could hit every sales goal without stress or guesswork.

That’s exactly what a smart sales plan can do for you. Sales planning is really important for any business to succeed. Having a clear sales plan helps your team stay focused on hitting goals and growing the business.

No matter if you’re new to sales or have been doing it for a long time, knowing how to plan for sales is really important. By the end, you’ll know simple ways to make a plan that matches your business goals and helps you sell better.

Let’s get started!🚀

What is sales planning?

Sales experts say that “Sales planning is a smart way of setting a business’s sales goals and figuring out how to reach them. It includes finding the right customers, deciding on sales targets, and making clear plans to achieve those targets.”

To create a sales plan, follow these steps:

• Set realistic sales goals based on market data.
• Develop sales strategies tailored to your target customers.
• Allocate resources effectively to maximize efficiency.
• Regularly track and assess your sales metrics.

How to Create an Effective Sales Planning Process?

The sales planning process is more than just the document that results from it. It helps businesses set clear goals and strategies to achieve better results. To be truly valuable, the sales plan example should be the outcome of a detailed, well-informed, and strategic approach.

From my experience, there are several key steps to include when planning sales:

• Collecting sales data and identifying patterns.
• Setting clear goals.
• Define key success metrics.
• Evaluating the current status
• Initiating sales predictions
• Recognizing gaps.
• Ideate new initiatives
• Involve stakeholders
• Outline action items

Step 1: Collect Sales Data and Identify Patterns

To plan effectively, it’s essential to reflect on past sales data. Looking at historical sales over the past year or even the past five years gives you a sense of trends that can guide your future decisions.

How to Collect Sales Data?

Let’s say I’m the newly appointed sales director for a software company that provides cloud-based HR solutions. My target market is medium-sized businesses in the tech sector on the West Coast.

Before I set any sales goals, I’d look at the past sales performance for this market. I would examine key questions such as:

• How much revenue did we generate from the tech sector over the last five years?
• What was the churn rate for existing clients?
• How did sales growth in this sector compare to other sectors?

Learning about these parts helps me understand customers better, their needs, and any problems that might come up.

Step 2: Setting Clear Goals.

How can you measure your business’s success without clear goals and objectives? Once you’ve outlined them, you can begin to take actionable steps toward achieving them.

How to Set Sales Goals?

Let’s say I’m working with a software company that provides tools to small businesses. After doing research on market trends and what customers need, I would set big sales goals, like getting more people to use the product.

To make the goal clearer, I would create specific tasks, such as reaching out to 50 small business owners in my target market, setting up 20 product demos, and turning at least 10 of those businesses into paying customers within three months.

Additionally, to measure success, I could create SMART objectives such as:

• Increase product demos by 25% this quarter
• Generate 100 new leads per month
• Close 15 deals within the next 6 weeks

These objectives would help ensure that the sales team is focused on measurable actions that contribute directly to achieving the broader revenue growth goal.

Step 3: Define Key Success Metrics

Every business has its unique traits, but all share a common need for effective metrics and KPIs to evaluate success.

How will you measure success in your business? Metrics can change based on your business, but some common KPIs are things like profit margins, return on investment (ROI), website visits, and conversion rates.

KPIs for Sales Reps vs. Sales Managers

Sales Rep KPIs

For sales reps, KPIs focus on day-to-day performance and productivity, such as:

• Calls Made: Ensures reps maintain consistent outreach and high activity levels.
• Conversion Rate: Measures the number of prospects converted to customers, reflecting sales effectiveness.
• Average Deal Size: Monitors the revenue from each deal, motivating reps to secure larger sales.
• Sales Cycle Duration: Tracks the time taken to close deals, helping reps streamline their approach.

Sales Manager KPIs

For sales managers, KPIs are like a big-picture snapshot of how the team is doing, including things like:

• Total Revenue: Shows how much money the team is bringing in and how close they are to hitting sales goals.
• Pipeline Value: Estimates the worth of deals still in progress to help predict future earnings.
• Win Rate: The percentage of deals won, helping spot where the team can improve.
• Employee Retention Rate: Measures how well the team sticks together, which is key for long-term success.
• Training Progress: Checks if training is working and if the team is keeping their skills sharp.

How to Identify the Right Sales Metrics?

Sales metrics are numbers that measure how effective your salespeople are. They inform you what’s going well and not so well so you can improve.

Primary examples:

• Revenue: How much have you made?
• Deals closed: How many have you closed?
• Conversion rates: How many leads have you turned into customers?
• Customer lifetime value: How much each customer spends over some time period.

By monitoring these, you can tell where to put your effort for maximum gain.

Step 4: Evaluate the Present Situation

How’s your business doing right now? It’s important to take a good look at where you stand compared to the goals you set. What problems are getting in the way? What strengths do you have?

• Write down the challenges holding you back and the resources or advantages you can use. This will help you create a smarter, stronger sales plan going forward.

How to Evaluate Current Business Standing?

As the new sales director for a software company that offers cloud-based HR solutions to medium-sized tech businesses on the West Coast, I’d look at past sales data and my goals to understand where I stand right now.

For example, if my goal is to increase revenue by 20% Y/Y, I would start by analyzing the company’s current retention rates. This would help me determine if customer retention is a major area needing improvement.

Next, I’d examine the sales patterns of the technology companies we’ve already contracted. Are there any recurring pain points that we’re continually resolving? I’d also review our demo process to see if we’re leaving out key aspects of our value proposition. I could use conversation intelligence to discover how our reps are engaging with prospective customers.

In the end, I’d want to understand how well we’re doing, find any problems in our strategy, and improve our plan so my team can sell better and meet our revenue target.

Step 5: Start Sales Forecasting

Sales forecasting is about guessing future sales to help with decisions like budgeting, hiring, and setting goals. Accurate forecasts make it easier to plan and use resources in the best way.

How to Forecast Sales?

1. Gather data: Collect past sales data, market trends, and customer information.
2. Choose methods: Select suitable forecasting techniques (e.g., moving averages, regression analysis).
3. Build models: Develop and test forecasting models using statistical software.
4. Generate forecasts: Create projections for different time periods.
5. Monitor and adjust: Regularly track actual sales, analyze deviations, and refine your forecasts.

Step 6: Recognizing Gaps

• To spot gaps in your business, assess both your current and future needs. Start by determining the skills required for your team to achieve the set goals. Then, evaluate the skills of your existing employees.

• After gathering this information, provide training to your current team or consider hiring new talent to address these gaps.

How to Recognize Selling Gaps?

In our software company example, let’s say my sales forecast shows results that don’t match the goals I’ve set for the team. To fix this, I would look at the whole sales process, operations, and resources to find areas that need improvement.

I might find that our sales materials are outdated and don’t show the latest features of our cloud-based HR solutions. Also, our sales reps could be booking demos but not converting them because they lack proper training and aren’t delivering a clear message.

In the end, I might notice that the sales and marketing teams aren’t fully on the same page, which leads to prospects expecting things that we can’t deliver. Once I spot these issues, I’ll work on updating sales materials, giving better training to the team, and making sure sales and marketing work better together to hit our goals.

Step 7: Ideate New Initiatives

• Many trends in the industry come and go. When you create your sales plan, consider new ideas that may have been missed before.

• For example, if your business has mainly relied on word-of-mouth and social media marketing, now might be the perfect time to try out webinars or special promotions.

How to Ideate New Sales Initiatives?

In our software company example, I would come up with new initiatives based on the gaps I discovered earlier. One of these might include updating our sales content and marketing materials to showcase the latest features of our cloud-based HR solutions.

Next, I’d roll out new training programs to help our team conduct better demos. Finally, I’d collaborate with the marketing team to align our messaging, ensuring prospects have clear and realistic expectations about what we offer.

Step 8: Involve Key Stakeholders

• Stakeholders are the people who care about your business, like investors, employees, or customers. They often help make important decisions.
• When you finish your sales plan, it’s a good idea to bring in people from teams that impact sales, like marketing and product. Working together makes your sales plan clearer and stronger.

How to Involve Stakeholders

Once I have identified the key barriers impacting my software company’s sales team, it’s time to engage the relevant stakeholders.

First, I’ll connect with those managing sales content and marketing collateral. They are responsible for producing targeted case studies and whitepapers tailored to our ideal customers in the tech sector.

Next, I’d ask middle managers to check how the sales team is doing. If needed, I might suggest extra coaching or bring in outside experts to help with demos and training. I’d work closely with marketing leaders to sharpen our message. Making sure we clearly explain the product’s benefits helps customers understand exactly what to expect.

Step 9: Outline Action Items

• Once you’ve established your sales planning process, the final step is to outline the action items that will guide your team through the sales cycle. This ensures that every department is aligned and knows exactly what to do at each stage.

• Use your company’s capacity and quota numbers to create a list of specific action steps. Think about things like drafting a sales call script, analyzing competitors, or planning new incentives to drive sales.

How to Create a Sales Action Plan?

Let’s say I’m the newly appointed sales director for a software company offering cloud-based HR solutions. Here are some key action items I would focus on:

• Revise our prospecting strategy by providing more coaching and refining our sales messages to better reach medium-sized tech companies.
• Rework our buyer personas for key decision-makers like HR managers to better reflect the needs of our target customers.
• Conduct new training on how to demo our software effectively for potential clients in the tech sector.
• Implement our updated prospecting strategy from ideation to execution, ensuring the team follows through.
• Collaborate with sales enablement stakeholders to create relevant case studies and whitepapers for the tech sector.

While this list isn’t exhaustive, these are the essential steps that will help us build a more effective and strategic sales plan, improving our outcomes and setting a path to better performance.

Sales planning should not just end with creating a document. I suggest repeating this process every year to keep your team aligned and focused on growth.

Additionally, setting up a Standard Operating Procedure (SOP) for the sales planning process will save time and maintain consistency across your organization, making it easier to adjust your plan year after year.

Importance of Sales Planning Process

Sometimes going with your gut in sales can work, but it’s risky and hard to keep up over time. Having a clear sales plan makes sure everyone on your team is aiming for the same goals, which helps them work better together.

I remember a client whose sales kept dropping, and the team felt really down. When we looked closer, we found they didn’t have a proper sales plan. Once they put a good sales plan in place, things started to improve.

• Set achievable sales goals
• Identify high-value leads
• Perform regular performance reviews

The outcome was impressive—within just six months, they saw a 27% increase in sales, and the team was more engaged and motivated than ever.

Here are some of the important aspects of having a structured sales planning process:

1. Clear Direction and Focus

Having a plan for sales serves to give your team a guide and set direction and milestones. This helps make it simpler for you to target the right leads and avoid last-minute panic attacks to fill up sales quotas. Without a plan, you will lose track and fall short.

2. Efficient Use of Resources

An action plan will lead you to make more tactical choices about how to invest resources, your people, your money, or your time. For my client, they were previously overworked and underloaded with too many prospects. After implementing their plan, they only chased the best prospects, and that led to improved conversions and more revenue.

3. Improved Team Performance and Morale

For my client, things changed once their sales team had measurable, quantifiable goals. With a sales plan in place, the team had direction and motivation, which equated to better performance and job satisfaction. When your team understands the big picture goal, they perform better as a team.

4. Predictable Revenue Streams

A good sales plan gives you the advantage of predictable revenue, which is key for better budgeting and strategic growth. In fact, a Logility report found that businesses with effective sales planning saw a 31% improvement in forecast accuracy, leading to more strategic decisions.

5. Ongoing Improvement

An unambiguous sales plan sets down milestones and performance metrics to help track progress. I would always recommend monthly reviews to assess how the sales team is doing with its tasks. The reviews help you see where it needs improvement, identify high performers, and make quick adjustments.

Tips for Creating an Effective Sales Plan

We’ve discussed the key components of a sales plan, including examples and templates.

Now, let’s dive into some actionable tips to help you create a plan that not only meets your targets but also impresses your superiors.

• Leverage industry trends to enhance your plan. When presenting to stakeholders, using market insights and trends can show why your approach will be successful.

• Identify the tools you’ll use to track progress. Whether it’s CRM systems or dashboard software, be clear about the technologies that will help measure and track your sales success.

• Back your budget proposal with data. If your sales plan includes a budget, support it with historical performance data and reliable sales forecasts to make your proposal more convincing.

• Create tailored plans for each sales team. Different teams, like business development, inbound sales, or field sales, may have unique goals. Customizing the plan for each team will allow for more targeted strategies and KPIs.

• Collaborate with your marketing team. Sales and marketing alignment is crucial. By involving marketing in the planning process, you can better align your strategies for lead generation, finding, and building relationships.

• Talk to your sales reps. Understand their daily challenges to ensure your plan is practical and achievable. Their insights will help fine-tune your approach and avoid unrealistic expectations.

• Conduct a competitive analysis. To stay ahead, it’s essential to know your competitor’s strengths. This knowledge will guide your plan to position your company more effectively in the market.

What are the different types of sales plans?

There are several types of sales plans you can create to suit your organization’s goals. Below are some examples to help you find the best fit for your needs.

1. Marketing- Alignment Sales Plan

While many traditional sales plans already integrate marketing, you might want to develop a marketing-integrated sales plan if your company hasn’t yet aligned these two functions.

This plan focuses on crafting ideal customer profiles, refining buyer personas, and syncing marketing communications with sales messaging.

Effective integration makes sure that everyone is on the same page, reducing the risk of miscommunication and improving overall performance.

2. Business Development Strategic Sales Plan

A business-focused sales plan includes purchasing new customers through networking, partnerships with other companies, sponsorship of events, and outreach. Attention should be paid to the choice of the appropriate KPIs that best measure the effectiveness of these types of outreach.

From my experience, business development is crucial for ultimate success, since it allows your organization to have a greater idea of the competition in your own industry and design strategies to become different.

It also syncs your entire team as a whole toward the same objective, so there’s a unified focus on expansion.

3. 30-60-90-Day Sales Plan

This sales strategy is structured around a timeline with objectives set for 30, 60, and 90-day intervals. You may focus on goals like achieving sales targets or decreasing customer turnover.

It’s perfect for someone new to a position, allowing them to monitor their progress during the first three months. It also works well for a startup that is still defining its sales objectives.

Peggy Ratcliff McKee, an executive career coach, refers to the 90-day plan as an excellent starting point, allowing you to adjust goals as per the company’s specific needs.

4. New Product Sales Plan

When you launch a new product, having a sales plan to help bring in money right from the start is really important.

Based on what I’ve seen, it helps a lot to check out what your competitors are doing, decide on a clear way to sell, make your brand stand out, and find good partners to help get your product out there, especially if you’re starting to sell through other companies or stores.

5. Market Expansion Plan

A market expansion plan is a strategic approach that outlines the steps and objectives when launching into a new region or market. It primarily focuses on reaching the target audience in an untapped geographic area.

This plan usually includes checking the costs for distribution, looking at time zone differences between your sales team and potential customers, and preparing for other challenges that may come up.

Common Sales Planning Mistakes to Avoid

Here are the common sales planning mistakes to avoid:

• Lack of Clear Goals and Objectives: Setting vague or unrealistic goals.
• Insufficient Market Research: Not understanding your target audience, competitors, and market trends.
• Ignoring Customer Needs: Focusing too much on product features instead of the benefits for customers.
• Poor Lead Qualification: Chasing every lead without proper qualification.
• Lack of a Sales Pipeline: The progress of leads through the sales funnel is not tracked.
• Inadequate Sales Forecasting: Failing to predict future sales accurately.
• Neglecting Sales Training: Not providing adequate training to your sales team.
• Overlooking Customer Relationship Management (CRM): Not using a CRM system to manage customer interactions and data.
• Failing to Adapt to Change: Sticking to a rigid sales plan without considering market changes or customer feedback.
• Neglecting Sales Metrics: Not tracking key sales metrics to measure performance.

Final Words

A great sales plan isn’t just paperwork, and it’s your path to real success. When you follow a clear process, set specific goals, and keep fine-tuning your approach, you’ll boost your performance, energize your team, and drive real business growth.

Whether you’re refining what you already have or starting fresh, use this plan as your go-to guide. Take the first step now, and watch your sales take off!

FAQs

What is a sales plan?

A sales plan is like a game plan that helps you know what to do to sell more and reach your goals.

What are the key elements of a sales plan?

It includes what you want to achieve, who you want to sell to, how you’ll do it, and who’s on your team.

What goes in a sales plan template?

It has your goals, who your customers are, your sales ideas, team roles, and how you’ll track progress.

What is the 30-60-90 rule in sales?

It’s a simple plan for new salespeople to learn, try things out, and get better over their first three months.

How do you measure the success of a sales plan?

You check if you’re selling more, keeping customers, and hitting your goals over time.