I spent a great deal of time in Corporate America, frequently near the sales force. Every October the heat was turned up as the salespeople redoubled their efforts to meet their annual goals set way back in January. It meant working right up to New Year's Eve in many cases.

When I talk to many of my business clients, I don't sense the same sense of urgency. In fact, in too many cases, my clients don't do forecast planning and don't check their numbers on a quarterly basis. Come October, they have no idea whether they should work harder or head for the beach.

How Many Customers/Clients Do You Need?

One of the important steps to take while running a business is to develop some type of business or marketing plan. It doesn't have to be elaborate. What you do need to know is how many purchases it will take to cover your monthly expenses and leave enough left over to pay yourself. Behind that number is how many customers or clients you need and what they need to buy. Multiply the number of clients or purchases (whatever works best for your business) by 12 to determine how many clients or purchases you need to generate in a year.

(If you have a seasonal business, it's a little more difficult to track because you have to look at fluctuations from month to month, but it can be done.)

That number is your goal for the year. By dividing the number by four, you wind up with your quarterly goal.

How Much Are You Selling Each Quarter?

Take a look at your sales. Hopefully, you are using QuickBooks, Quicken or something similar so you can access this number easily. (If not, make getting this type of product one of your top priorities -- even if you have a bookkeeper.)

Where are you? Notice in which quarters you met your goals and which quarters you didn't. What happened in each case? By doing this analysis, you'll be able to figure out if you can relax and go to the beach this month or get going to develop more customers.

If you pay attention throughout the year, from quarter to quarter, or even month to month, you'll have a better idea of the state of your business. Then you can make corrections in a timely manner.

The Numbers Behind the Numbers

The number of customers or clients you need to make a sale is only the tip of the iceberg. How many contacts do you need to make to get each client?



For example, if you do a presentation to 10 people to make a sale and you need 20 sales a month to make the money you need, then you need to do 200 presentations a month on average.

Then you need to go back even further. How many people do you need to call to get one presentation? Let's say you are a phenomenal salesperson and it only takes calls to two different people to get the presentation. You still need to plan for 400 calls a month to meet your goal.

Overwhelming? It doesn't need to be. It just needs to be a system that you (or people you hire) follow day in and day out. But it begins with knowing how many customers or clients you need to make a profit in your business.

And making a profit is what it's all about, isn't it?

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About the Author

Casey Dawes is a small business owner with over 20 years of experience in the technical industry.

Casey has been published in multiple magazines, ranging from children's magazines to technical journals. Casey's technical expertise, communication ability and coaching is a powerful combination that will help you get your business where you want it to go in the fastest time possible.