Sales
don’t just happen
In its simplest form, every
business has only three components. Those are operations, marketing and finance.
Operations is the production
and delivery of the company’s product or service. Marketing is making
customers aware of the product or service and selling it to them. Finance lets
you know how marketing and operations are doing.
In small businesses, the
owner usually knows their product or service, how to develop it, make it,
improve it and deliver it. If they’re lucky, they also know how to efficiently
market and sell so the company consistently grows.
The fortunate owner
understands what the financial statements mean and acts accordingly.
Getting new customers is
always a challenge. Some companies use marketing to bring the customers to them.
Others use salespeople to go to the customers. And for some it’s a
combination.
Let’s concentrate on the
sales process, which is an area that often breaks down. Now there are more books
and sales training programs out there than there are coffee shops in greater
Seattle. We won’t cover how to close or selling styles but rather provide an
overview of the process.
For the small owner-operated
business sales are often made on in-depth knowledge of the service or product.
This is why so many companies have a hard time growing. They never really
understand why the customer buys. For an example, let’s examine some of the
issues I recently worked on with Ben (not his real name), who owns a service
business.
Ben’s situation is he had
one customer who accounted for over 50% of his sales and that customer scaled
way back. To start growing he is advertising heavily. Unfortunately, even though
he’s receiving over three times as many calls he is closing less sales than
before.
Funny how it always comes
back to the basics. First, to whom are you selling? In other words, who has the
final approval? If you sell to businesses there is an economic buyer. Everyone
else can say no but not yes. You need to be dealing with the person who can say
yes.
Do you sell to individuals
or families? Is it the husband, wife, both or maybe the kids who have final say?
Again, you’re wasting time if you don’t have the decision maker.
If retail, do your people
still use the tired old “May I help you?” line? There are a lot of better
ways to greet people. The key is to get them off balance. One of the best is in
“The E-Myth” by Michael Gerber (xxx, 1000). He suggests that retail people
ask, “Have you been here before?” Just think of the possibilities no matter
what the answer.
In Ben’s situation, he was
selling to businesses. However, he never bothered to find out if the person he
was talking to was the decision maker. As is typical, he wasted a lot of time
with people who couldn’t do anything but gather data. It became a price issue
and he’s not priced on the low end.
More than ever,
relationships are what trigger sales. No relationship, no sale. Don’t let your
outside people try to compete on price or go for the quick sale. You have to
find out what the hot buttons are. That means getting to know your customers and
their situation. You have to solve a problem to ensure success!
Ben had to learn to not
quote prices upon the first mention of the word. But rather to ask questions. To
find out what is the situation that needs service. Does the customer understand
the difference in service levels, the value of quality employees doing the work
and the hurt that will occur if inexperienced people don’t do the job
correctly?
Two of the biggest mistakes
inexperienced people make are not using a script and not asking enough
questions. The economy would get a jump-start if all salespeople started using
scripts. If they knew how to communicate the value of their product or service
so that the buyer saw the potential benefit.
We all love to talk so much
it gets in the way of making sales. In Ben’s case he didn’t know what he was
going to say so he jumped into the price discussion and lost. When he did talk,
it was about the service and its features but not about the value proposition
and benefits. An old sales adage is to ask questions to make the client hurt and
then rescue them with your product or service. It really does work.
Why does your customer buy
from you? Who else could they buy from and why don’t they? I recently did a
study the confirmed similar studies I had read about. The company was asked why
their customers buy from them. Then the customers were asked the same question.
While the answers are similar, the order of importance is always reversed.
Your job is to provide value
to your customers. They should feel that the benefits you provide far exceed the
cost. It doesn’t matter what you sell.
In Ben’s case he never got
a chance to tell his prospects about the quality of his service compared to the
competitors. Or, the guarantees he offers. Because he didn’t ask questions, he
didn’t get a chance to explain why various elements of his service were
important and better.
What do salespeople hate the
most? What do owners usually despise? It’s paperwork! However, without
tracking statistics how do you know what is working and what isn’t. A client,
not Ben, was very disorganized with the paperwork. One good thing she did was
ask every caller how they heard about her firm. This let her determine what
marketing worked and what didn’t.
For those of you with
outside salespeople, if you don’t have them record all of their activity in an
easy to understand format you are making a big mistake. Knowing the activity
lets us track and project future sales.
The bottom line is that the
sales process is too often overlooked. Outside salespeople are thrown a product
manual and told to “get out there and sell this stuff.” Inside salespeople
are told to be nice and help the customer. Taking the time to develop a plan,
scripts, a value proposition and tracking tools is well worth the investment of
time and brainpower.