Roundtable: What Are the Top Sales Mistakes Young Companies Make?

We contacted some of the top thought leaders in the world of sales to learn more about how early and expansion stage companies can improve their overall sales processes. In the first of this three-part series, sales strategists Rich Chiarello, Jonathan Farrington, Colleen Francis and GuruGanesha Khalsa discuss some of the common sales pitfalls that young companies should avoid.

In your experience, what sales mistakes do startups and growing technology companies make most often?

Rich Chiarello, President, Above the Line, LLC

The most common mistake I see involves companies that don’t switch their sales profile from evangelists to hunters as they enter the growth stage. Companies need different sales skills and natural talents at the different stages of their growth, but human nature leads to most people hiring in their own image and likeness, which does not foster variance.

 

Jonathan Farrington, Chairman, The JF Corporation

There are many, but here are two primary examples. First, companies that believe because they have such a great product, solution, or service, it will automatically sell itself. It won’t! Ralph Waldo Emerson once said, “Though a man lives in the midst of the woods, if he makes a better bobbin than his neighbor, people will beat a path to his door.” (Or something like that!) Unfortunately, 21st century marketing has moved us all on from that type of optimistic word of mouth marketing. Nothing happens in this world until someone sells something, and undervaluing the importance of sales and selling can only lead to failure.

Another common mistake is over-enthusiasm for one’s own product, solution, or service. This is, to an extent, only natural. After all, did you ever meet a mother who didn’t think her baby was beautiful? Thorough pre-design and launch market research is essential.

Colleen Francis, Founder and President, Engage Selling Solution

One is not understanding just what it takes to build a pipeline and ignoring the prospecting side. Another involves not really understanding the business value of the software or the technology. So as a result, what I see are a lot of early-stage startups hiring salespeople who are technology-based and don’t understand the business case, which is a mistake because people ultimately buy your software or technology service based on the business value it provides.

Also, these companies make mistakes because they hire the wrong kinds of salespeople. As a startup, you need to hire salespeople who are great hunters, who love to build pipelines, and who have a proven background of building something from nothing. Founders often get a little bit excited about salespeople who have really great resumes in closing large deals or managing big, multi-million dollar opportunities. But they might not be the right personality or behavioral fit for a startup company that needs someone who can dig in the trenches — who can go after deals and hunt them.

GuruGanesha Khalsa, CEO, Sales Training Institute of Virginia

The biggest mistake sales reps make is they don’t necessarily have a plan. As a result, I’d say close to 100% of the time if you were a fly on the wall watching the typical inexperienced sales rep sell, it’s very clear that the buyer is in complete and total control of the process. So when the buyer says “Jump,” the typical sales rep says, “How high?” When the buyer says “Roll over,” the typical sales rep says, “Should I land face up or face down?”

The inexperienced sales force is expending so much unnecessary time, energy, and resources. It drives the cost of sales way up. It increases the length of the average selling cycle. It results in a tremendous amount of unnecessary discounting. The average sale is usually quite lower than it could be. The closing ratio in competitive situations is low because the seller is really not in control of the process. They’re not providing leadership.

Next week: Which sales metrics matter most for young technology companies? Some of the top sales strategists in the business discuss the mistakes they see most often in early and expansion stage technology companies.