Sales executives always shake their heads when the annual sales targets come out.
But this year the managers of Australia’s biggest companies have gone too far.
At ASX 50 companies, sales leader confidence in meeting 2014 sales targets has plummeted to 64 per cent from 91 per cent last year.
And 70 per cent of sales professionals expect sales targets to skyrocket for the year ahead.
The Synergy Group, a sales advisory firm based in Sydney, surveyed sales executives and analysed the sales performance of the ASX 50, finding more than a quarter didn’t hit their sales forecasts in 2013.
Synergy’s report, SustainSales: Outlook and Opportunities, says one-third barely hit their sales forecasts, experiencing marginal growth rates of less than 5 per cent.
Another third reported to have hit their sales targets moderately, experiencing growth of between 5 per cent and 25 per cent.
A slim 2 per cent experienced strong earnings growth of above 25 per cent.
“This suggests a tough business climate where even Australia’s most powerful corporations will face ongoing turbulence over the next two years, when shrinking profit margins will begin to impact on internal capabilities,” says Katherine Edgar, CEO of The Synergy Group.
“In the current business environment, where sales leaders are pressured to perform amid challenges beyond their control, forecasts and pricing must be regularly reviewed and targets adjusted to reflect external conditions.
“And while sales targets are being stretched, sales professionals are experiencing cuts and customers are tightening their spending. The burning question for any business today is how to get new sales.”
Almost half (42 per cent) of the surveyed sales professionals are shifting their focus towards longer-term strategies to compensate for a shrinking revenue pool by improving processes, lifting quality and drawing more on customer insights.
“It is promising that there is a growing awareness among sales professionals of the need to be more innovative and use data analysis to better understand their customers if they are to meet their targets. However, sales leaders are still struggling with the how to create a more client centric culture through innovation and more rigourous data analysis.”