All that glitters is not goals.
By Gordon Hecht
You can tell the end of the year is near by the leftover Halloween lollipops and the Christmas music playing in the Bed Bath & Beyond My Budget.
The next seven weeks will roll by quickly between holiday sales and extra time off requests. It’s a great time to get your 2022 goals written down for yourself and your team. Just like in pre-pandemic November 2019, we don’t have a crystal ball to foresee the future, so goal setting must be realistic and optimistic. Goals are simply a roadmap to a destination. You must know where you want to go and how you want to get there.
It’s easy to jot down nebulous goals like more sales, better customer service, and lower costs. The harder part is quantifying those goal into a destination — something measurable. A smart way to set goals is by using the acronym SMART. Any goal you set should be:
• Specific: Target a specific area for improvement.
• Measurable: Quantify or at least suggest an indicator of progress.
• Assignable: Specify who will do it.
• Realistic: Results can realistically be achieved, given available resources.
• Time-related: Specify when the result(s) can be achieved.
Consider a sales goal (for the company or store location). It’s easy to state a goal as “increase sales by 10 percent,” which is sorta specific but does not have the necessary roadmap to get there. Get SMART with the goal by adding in mile markers, deadlines and responsibilities. You may land up with something like:
“Achieve annual sales of $1 million, divided as $275,000 in Q1 and Q3 and $225,000 in Q2 and Q4. Increase post-store visit contacts to one follow up text or email to each non-buying shopper and add $50 in accessories to every customer who places order. Sales associates will review each unsuccessful sales presentation with store manager. Store manager will review lost sales due to inventory or product mix with senior managers on a weekly team call.”
For your front-facing sales team, goals should be stated in a way that benefits them, especially if they are rewarded by performance-based pay. Everyone likes Certificates of Achievement, but I prefer mine to be colored green with pictures of presidents on them.
Related: Sales Commissions vs. Wages
Rather than tell your team to “sell a million,” why not coach them to “earn six figures.” Convert your sales goals to their earnings goals.
A sales associate needs to earn about eight grand a month to earn $100K in 2022. Based on a commission/bonus/spiff rate of 7.5 percent, Sally Supersales needs to write about $107,000 a month. Her sales goal can be:
“Earn at least $100,000 in 2022. Maintain sales of $107,000 a month by achieving 30 percent adjustable base attachment, 70 percent accessory add on, and a 60/40 mix of premium to promo products. Contact each non-buying shopper via text, call or email within 24 hours of the initial presentation. Communicate missed sales opportunities daily with store manager noting issues with inventory, competition and product mix.”
Goals can also be measurable beyond the sales team. Next year will be challenging for staffing, controlling operational costs, and effectively managing marketing costs and results. Here’s just a few goals you will want to set and review as SMART goals to achieve success:
• Staffing: Maintain/reach full staffing. Reduce turnover and actively recruit. Setting and reviewing goals is a good start for retention.
• Operations: Reduce costs using efficient and effective delivery routes and reduce damage and inventory shrinkage. Dispose of or clearance sale outdated merchandise. Reduce cost of utility usage.
• Marketing: Effectively invest advertising funds and fully use co-op dollars. Measure effectiveness through advertising cost to purchase ratios.
• Store Appearance: Create a punch list for store improvements and schedule dates and funds for completion.
• Metrics: Anything we measure will improve. Make 2022 the year you hold yourself and your team accountable to metrics like traffic count and close rate, sales per guest, cost per delivery, advertising cost per guest, and inventory turns.
Goals are not something you write out in December and keep in a drawer for 12 months. Post your goals in the breakroom or headline them in your internal communications. Review them at least monthly; the more often the better.
Share successes and shore up underperformance and 2022 might just be the best year ever!
Gordon Hecht is a business growth and development consultant to the retail home furnishings industry. You can reach him at Gordon.Hecht@aol.com.