Closing Numbers and Backlog for Sales Directors

By Mike Fujihira, Sales Leader - New Home Star

Most builders have started to talk about end-of-year closing numbers. Sales Directors know how important that is in the grand scheme of things. Sales made during Q1 and Q2 lead to homes being built in Q2 and Q3. These same homes are closed in Q4, providing builders with the last of their revenue for the year. There’s the age-old saying, “never count your chickens before they’ve hatched,” but builders are relying on every one of those ‘chickens’ to hatch. They expect that every sale that is reported right now will be included in their end-of-year numbers. Therefore, it is imperative that Sales Directors are not only continuing to push for new sales in the next 45 days but also making sure customers are taken care of in regards to backlog and overall service. Ensuring their happiness is vital; failing to do so could result in the loss of a sale right at the end of the year.

Planning is key during this time sensitive process. Have a conversation with the builder regarding current sales and the expected number of closings. If it looks like the numbers may fall short, speak about the feasibility of starting construction on specs that may be sold at year’s end. If it is possible, seize the opportunity as this will add some cushion and make sure there is still a fighting chance to make up for potential home delays and cancellations. If they don’t sell? There will be buyers with urgency at the beginning of Q1 next year, so it’s a win-win!

Now that the results of high backlog are detailed, the focus must rest upon the process of keeping up with such a heavy load. Directors must help their salespeople out with the stressful process of maintaining backlog. Here are a few ways to do so:

• Sales and Production walks are as important as ever. During this busy season, it’s easy to get caught up in other things and just skip them for the week, but those in the field know that communication is important to the on-demand culture that we live in. Salespeople need the most accurate and up-to-date information, allowing them to pass it along to customers.
• Swallow the frog! With the trade market the way that it is, delays are inherently part of the business. More often than not, “bad news doesn’t get better with age.” If there are delays or other issues that the customer isn’t going to be in love with, just bite the bullet and be honest. Keep Guiding Principle #1 in mind: guide the customer through the most favorable thought process.
• Ensure that customers are receiving weekly updates. Sales Directors should be helping out with these too! Every once in awhile, take a chunk of the sales team’s backlog and conduct those weekly phone calls. Update them on how things are going while ensuring that their customer satisfaction is high. This simple, yet meaningful act can go a long way in all aspects of a sale! Not only would a direct call from a Sales Director inflict the impression of high importance to a customer, it would also serve as a great Sales Associate Engagement strategy.
• Lastly, inspect what you expect. Directors must make it a priority to stop by the Sales/Production walks, follow up with associates who are facing challenging situations, and roll their sleeves up to dive into backlog with community managers who may be in the weeds a little bit. Sales Directors set the entire tone for their teams. Doing these practices will showcase to the team the emphasis on just how critical they truly are.

All in all, cancellations are inherently part of the business and are bound to happen, but the self-inflicted wounds are the worst. Missing closings at the end of the year because of a higher cancellation rate due to the efforts, or lack thereof, is not a good feeling to have. If Directors begin to place more emphasis on customer backlog right now, it will pay off significantly in the long run when those final numbers are reviewed.