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Keeping up with revenue growth expectations was becoming a problem for a mid-size, venture funded, technology company. Although the firm continued to invest in high-profile senior sales executives, low lead conversion rates and poor forecastability threatened the company's cash flow and valuation. Having unsuccessfully churned through two Vice Presidents of Sales and nearly the entire sales force, the CEO turned to Adder Group for a new approach.
Our analysis showed that the company’s most valuable sales resources were spending nearly 80 percent of their time with contacts which would ultimately not result in revenue. Meanwhile, the overly optimistic “sales person survey” method of forecasting provided upper management with unrealizable and unstable revenue projections. Our recommendations were to dramatically expand the number of outbound contacts; redesign the sales compensation structure to better foster a team approach to developing new accounts; utilize lower cost resources to develop leads and obtain re-orders; involve high-value resources on closable new engagements only; and to introduce segmentation and firmographics input into forecasting. Our solution included an outsourced inside sales and lead development department for our client.
With the Adder Group Account Development team making an average of ten calls for every field sales person visit, new sales closing ratio quadrupled within two quarters. Furthermore, the operations netted a 50 percent increase in rate of recurring orders and took revenue forecasts to 90 percent confidence level. One year after utilizing our service and following our advice, this client reduced sales expenditure while also exceeding investor profit expectations by 35 percent.