Free Advice

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.

Know your sales process

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.

Who, what, where, when, why and how

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.

Emphasize relationships

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?

Know what you’re going to say 

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.

Value is the key

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.

Monitor and learn

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.

© Copyright John Martinka 2003. All rights reserved.