29th May 2008

How to gauge a good BDM

Selling is a numbers game that can be quantified to show exactly what it takes to achieve ultimate and predictable sales success. Every BDM in your business should have a mathematical equation for their success. Some sales people have an 8-3-2 ratio, meaning they need eight prospects (leads, applications, etc.) with three of them granting face-to-face meetings (getting them pre-qualified, or approved) in which two ultimately become new sales. Keep in mind that every BDM has a different conversion ratio. Some may be 10-3-1 while others are 5-4-3.

The only way to discover a salesperson's conversion ratio is by tracking their prospects, presentations, and sales. This procedure is then tracked over a period of time that reveals the actual numbers. You should be able to identify the conversion ratios needed by any BDM or sales team to describe how many prospects, qualified leads, and appointments are needed to reach any targeted sales goal of your organisation.

The beauty of this system is that the numbers can be tracked to generate and reach even the most aggressive sales goals. As a professional broker you then know exactly how many prospects each BDM will need in order to reach five new sales. Better yet, if you wanted to reach five new sales per week or five new sales per day, you can simply adjust the ratio. This method of identifying prospects, qualified borrowers, and ultimately sales, can be duplicated to fit any market or originator. This provides the ability to predict, plan, and check your activity levels and development of you goals and objectives.

Tracking and knowing your numbers will:

  • Identify your strengths
  • Identify your weaknesses
  • Identify what is needed to reach goals
  • Project what you can expect
  • Hold your BDMs accountable (what gets measured gets done)

Most BDMs and sales managers might think this is common sense, yet many of them aren't able to answer simple questions regarding their numbers. For instance, what if you asked one of your BDMs right now, "What is your conversion ratio?" Do they convert 40 percent of everyone they present to? Or maybe they're converting over 80 percent? How many prospects do they need to see in order to double monthly production?

If they don't know right off the top of their head, they're not alone. Most sales people in our industry don't know the answers to those questions, simply because they are not tracking their numbers. If we don't know those numbers, how would they know which area needs improvement?

National Sales Tracking

The only way any sales campaigns (e.g. Broker magazine advertising, Television) can be judged a success or failure is by tracking all of the results involved, not just the actual sales.

It is therefore important to track the correct production period. Any organistaion should have 12 monthly campaigns per year and a 20-day selling period per month (five-day work week x four weeks per month), which means that each campaign is based on a 20-day selling period to show monthly projections. This way you can see if you are on track to reach the target numbers, and how many more prospects they would need to see in order to reach their goals.

For example, in a campaign you could track the following data from your entire team or on an individual BDM basis:

Day 20 of 20 selling days
Week's Gross Settlements (Sales)
$1,360,000.00
Period Total Gross Settlements
$19,161,321.00
Daily Average
$923,611.00
Total New Settlements
119
Daily New Settlements Average
5.95
Total New Leads Originators
603
New Lead/Originator Daily Average
30.15
Total Qualified Appointments
483
Total Seen Appointments
289
 
Highest Team Producer
28 Units
Top Sales Daily Average Settlements
1.4 Units
Top Sales Conversion Ratio
88%
Top Lead Generator
154 Leads
Daily Average
7.70 Leads

 

A BDM's daily production sheet should evolve over years of tracking the relevant data fields and adding and subtracting the numbers you don't need. In other words, if you decide you needed to know how many leads or prospects each of your BDMs got on a daily basis, you would add that. If you needed to also know how many he/she had on a weekly and monthly basis, you would add that as well.


Best regards
Iain Pepper




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Iain Pepper
Head of Lending

Iain Pepper is a Vice-President and the Head of Lending for the La Trobe Group.Read full profile here.








La Trobe is one of Australia's leading independent specialist mortgage Financiers. Its business includes residential mortgages, commercial mortgages, and investment services operating one of Australia's largest Mortgage Funds under AFSL 222213. It employs over 145 staff and has raised over AUD$10Billion to assist over 100,000 customers since inception in 1952.

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