Why international sales departments do not reach their annual goals and how to solve it?

Approximately between 40% and 55% of sales managers fail to achieve their annual goals, according to various studies. Many consultancies and experts on this subject have shed some light on the main reasons why international sales departments do not achieve these objectives.

We are approaching the end of the year and, consequently, exporting companies are starting to propose new goals, plan budgets and establish sales objectives for the year 2023. However, being successful in terms of sales can be quite a challenge and a difficult path if one is not painstaking, even more if we deal with internationalization.

Approximately between 40% and 55% of sales managers fail to achieve their annual goals, according to various studies. Many consultancies and experts on this subject have shed some light on the main reasons why international sales departments do not achieve these objectives:

  • Setting too many goals and making them unrealistic or unattainable. It is undoubtedly one of the most identified failures and that has a direct impact on sales, since they have to do with strategy. It is important to order the goals to be achieved from the highest to the lowest priority, to intelligently distribute the resources and efforts of the sales department, and of course schedule and temporarily date the required progress and the results that are desired to be obtained. In short, long-term objectives must be well differentiated from short-term ones.
  • Insufficient transformation and digital presence of the company. The sales department must have access to analysis and relationship tools with its customers, as well as the proper implementation and use of a CRM. In addition to a solid website and presence in social media, it is also advisable to control traffic, find out the opinions of your current clients and carry out email marketing campaigns.
  • Lack of "international mindset" and market research. Penetrating an international market requires a detailed study of the culture, the consumer and the segment to target, the supply of your competition, the real demand for the product, or even factors such as currency fluctuations between countries. In international trade, a bad fluctuation between the exchange of two currencies can mean an increase in profits or unexpected losses.
  • There is no alignment of the different departments which each other or between the sales objectives with the corporate strategy. According to a study by Aberdeen Strategy and Research, companies that align their marketing departments with sales experience 20% growth in revenue, while companies that do not have integrated teams reported a drop in revenue of 4%. These two departments have something in common, the client, and for this reason they must work together. Likewise, the mission, vision and values of a company must be integrated into the annual goals of the sales department.

There are examples of failure such as the American Walmart in Germany, which after 10 years had to withdraw its warehouses and stores from the country because they did not know how to adapt to the habits of buyers, who preferred to trust neighborhood stores and good prices over going to the outskirts to do the shopping of the day. They also had to abandon their business in South Korea and Japan, since the Asian mindset did not conceive that the low price-good quality ratio was entirely reliable.

To sum up, the increase in sales adds an extra challenge when it comes to transporting and presenting your products abroad. In addition to those mentioned above, there are other strategies or tips that companies should follow when exporting or opening up to an unknown market.

  • Establish strategic alliances. Through, for example, Joint Ventures, it is possible to access new distribution channels, develop new products or new marketing channels.
  • Correctly use Incoterms and set the currency in which the transaction is carried out. Knowledge about the responsibilities and risks that exporters and importers take can save us from inconveniences and additional costs, which could lead to losses. On the other hand, during the negotiation, the currency in which the transaction is carried out must be fixed and the possibility of contracting exchange insurance, again, to avoid losses.
  • Know the reality of your target market and its actors. Visit the country, learn the language, investigate their needs and consumption habits to adapt our product or develop new ones, study the customs procedures and legal requirements of each country. Consulting commercial offices or other official institutions can be of great help to export optimally. Our platform, xNova International, allows the performance of two main functions through market intelligence: finding importers and studying the competition in the international market. Having specific and real-time data, the decision-making process is highly optimized, increasing the competitiveness of companies and international sales.

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