The fact is if you are worth your salt, you are perhaps in the best sales climate of your career. I must be kidding –right? Consider this:

Five or ten years ago, everyone had plenty of cash, and seemingly, every prospective client had a home. To bring in new client business, it was likely you had to struggle to identify unknown, credit risky targets, and educate them about why they needed your product/service; or you had to try and steal market share by persuading well-serviced clients to make a move, probably on price. Your competitors had the money to pour into service and if a prospect or client balked, your competitors could also throw money at them.

Raise your hand if have had a competitor close their doors in the last 90 days. Raise your hand if you have had clients close their doors in the last 90 days. OK – put your hands down. Economic strategists, business leaders, and the reputable media tell us every minute of the day 20%-30% of businesses in many sectors will close their doors in the current climate.

If your competitors lose 20%-30% of their client base to business closure (not much to be done about it; no reactive pursuit to drag the business back), and the fact that the added stress of their remaining base is measurably constricting their spending, businesses are scrambling to stay afloat. Knee-jerk reaction to lost revenue is cutbacks in staff, cutbacks in hours, cutbacks in spending, all of which lead to cutbacks in service. What is the number one reason clients leave? Poor service. They are ripe and ready for the picking. Go get them. Now you must have fair pricing (notice I did not say lowest or even competitive) and be able to fulfill your promises of service and quality. Smart businesses will recognize these weaknesses in their competitors and exploit them.

Basic math says: 70%-80% of your competitor’s book of business is available to be captured – prospects who already know why they need your product or service; prospects who are already buying; prospects who are likely suffering from a service level issue.

Go get them. They will not come to you. Pardon the analogy, but what do rats on a sinking ship do? (I’m not saying that our prospects are rats, just hear me out.) Survival instincts take over and they jump onto the first seemingly stable thing that floats by. Ship wrecks sink on the spot; they do not typically float safely into the harbor and allow calm disembarking. You have to go to them. So, I’ve said it three times so far – go. Are you catching my point?

Because of fear and caution in the marketplace, you may have to double your prospecting efforts and tighten your sales interview behavior to bring them in; but the fact is that you have a fantastic prospecting market. Are you up for the work? Do you have a plan? Do you own the behaviors to make it happen? If you don’t, realize your competitors will be targeting you instead! You must do the work.

Beware – if you look like, smell like or act like the individual they trusted the last time, then you are in trouble. Prospects have their antennae up and they are watching closely. Do you know how? Do you know how to launch a conversation with the battle-weary prospect, who themselves may actually be pulling back? Prospects have become cautious, even fearful. You had better be able to move them out of that mode and into an active stance to get business done. Do this well and frequently enough, and then your 2009 will show the most new client growth you’ve seen in years!

“A Penny Saved is a Penny Earned” – Benjamin Franklin

“Always Get the Best Price, Therefore the Best Deal”

“Never Pay Retail, Always Pay Wholesale!”

In a perceived constricting economy coupled with dismal daily financial reporting, our customers’ and prospects’ desire to cut costs in any manner they can, is influencing their buying decisions more than ever before. This affects current, ongoing and newly projected purchases for 2009.

Reinforcing this picture, retail has a projection of 40% closure rates, including many household recognized names. Many economists are stating that overall there may be 20% shrinkage of private sector businesses, no matter what the field. This means that your current and perspective markets may shrink at that same rate. You’re not losing customers and prospects to competitors; you’re losing them to closure. This places greater pressure on your sales efforts to attain sales forecast at full margin, just to stay even with last year.

So how does this climate influence our businesses and your sales efforts? Well, knowing the enemy is the first step. Yes, there is pressure on all fronts to get the best price. No matter what your prospect states, this decision factor is playing a bigger and bigger role.

What is price – is it the same as cost? The answer is, of course, no. Very simply stated, price is what you pay for something, while cost is what you incur after purchasing.

The total cost of ownership needs to be addressed now more than ever before. So what are the components in determining this?

The True Components Effecting Cost

· Quality of product

· Ease of use or incorporation

· Timeliness in delivery

· Communication

· Support and expertise

Quality of product or service – Does it do what it is supposed to do the first time, or is there a constant reworking to fit the prospect’s requirements?

Ease of use – Is it “plug and play”? If not, does the supplier of the same provide the appropriate training so it appears so? Dealing with a provider shouldn’t be a chore.

Timeliness in delivery – When will it arrive is not a question that a client should be asking. They should know and be able to count on the stated schedule.

Communication – If there is an issue or difficulty, can I get the right answers when I need them; or does it seem that since the sale has been concluded, the client becomes a second-class citizen?

Support and Expertise – Does the provider really have the tools to deliver on their promises? Can they create what you need the first time, or do they take a “shelf-product of solutions” and make you conform to their requirements?

So let’s suppose that the saying, “You really do get what you pay for” is now more pertinent than ever. What happens when a disappointment occurs in any of these cost components? First of all, if a company buys or sells based upon being the lowest priced provider, what happens if and when things go wrong; and they always do?

Typically, if the product was sold on price, the provider generally does not have enough margin built into the price to care for and promptly fix any of the above-mentioned issues. In fact, since they sell on price, usually support and development capabilities are either very stretched or even mediocre. Low-profit margin companies rarely have the expertise, personnel, support or financial backing; they can’t afford them.

We need to be addressing, not the price prospects pay for products or services, but rather what they may experience when they are disappointed by a low-priced provider.

What do they experience when what they bought doesn’t work as they thought?

What support is provided when they need help?

What happens to their production and promises to their clients if they can’t deliver on time?

What does this cost?

When you add these real business experiences and associated costs, it gives us the true price, which is the “Total Cost of Ownership”.

Developing Your Prospecting Plan

The lifeblood of your sales is prospecting. Consistent high-level performance and revenue growth are impossible without a continuous flow of leads and, more important, a plan to obtain those leads. The professional salesperson needs to constantly engage in lead-generating activities; find a sufficient number of leads; convert those leads to prospects; then move the prospects through the sales cycle; and, finally, close business. Without a plan, a salesperson has no organized method to reach potential prospects.Without daily or weekly prospecting events, the salesperson easily gets lost in day-to-day activities and neglects prospecting. A strong prospecting plan will help you generate sufficient leads to reach your sales goals.

Common Prospecting Mistakes:

• Using only passive prospecting channels.

• Depending on only a single prospecting channel.

• Little time devoted to actively prospecting on a regular basis.

• No defined prospecting/action plan.

• Not keeping track of your prospecting sources and their effectiveness so you can adjust those sources accordingly.

The Right Mix for Your Prospecting Plan

By creating the right mix of prospecting activities you will:

• Increase the number of prospecting activities.

• Invest the most time with the most effective activities.

• Rotate various activities, taking the pressure off any one activity.

• Invest time to improve your skills of activities that make you uncomfortable.

• Redirect time spent on activities that yield marginal results.

Using active prospecting activities is the most important, most effective use of your time. Active prospecting activities are those that can be measured, that have results you can track and, most importantly, are ones over which you have control. Passive prospecting activities are those in which you wait for someone else to make the first move.You have little control of passive activities.

What is Active Prospecting?

Active prospecting occurs when the salesperson generates leads through his/her own activities: cold calls, direct mail campaigns with follow-up phone calls, networking, generating referrals, obtaining introductions, and creating alliance and partnering relationships.

What is Passive Prospecting?

Passive prospecting happens when the salesperson waits to receive leads from an external source: advertising, PR and marketing departments, news stories, telemarketers, promotions, trade shows, and seminars.

Referrals

Referrals are individuals whose names have been provided to a salesperson by a friend, acquaintance or client. You may know something about the referral and can mention the name of the person who referred you.

• Referrals are an ACTIVE prospecting tool.

• You can broaden your prospecting base by tapping into the contact base of those you know.

• You may feel more comfortable contacting someone who was referred to you.

• Because you have a mutual acquaintance, the referred person may be more willing to talk with you.

• Referrals can be self-perpetuating.

• You can control how many people from whom you ask for referrals, how often you ask, and if and how soon you contact the referred person.

Classes of Referrals

There are four different types of referrals:

• Cold: only name and phone number are provided.

• Cool: name, phone number, and title are provided, as well as one PAIN, budget or decision-making information.

• Introduction: individual provides name and phone number, then calls ahead to tell referred person about you, your business, and the kind of work you’ve done with him/her.

• Face-to-face introduction: same as an introduction, but individual also accompanies you to the appointment.

What you say in the initial contact with a suspect/prospect is critical

Your initial approach needs to:

• Get a prospect’s attention quickly.

• Explain what you do.

• Tell why your clients work with you.

• Discuss what PAIN they experienced prior to working with you.

• Qualify the prospect as a “fit,” based upon customer PAIN you resolve through your service or product.

• Qualify the prospect based upon his/her level of PAIN, and determine if the situation must really be corrected.

Networking

Networking occurs when you meet people in your own or other fields, formally or informally, to give and receive business leads; it can include the formation of strategic alliances.

• Networking is both an ACTIVE and a PASSIVE prospecting tool.

• Networking events enable you to meet other people, share leads, and learn who has the potential to do business with whom.

• Networking provides a chance to make cold calls in a friendly and non-threatening environment.

• Formal networking is usually associated with a specific group that meets regularly for members to get to know each other and their businesses so they will refer business to each other.

• Forming strategic alliances with sales professionals who sell non-competing or complementary products/services in your market is another way to network. Set regular meeting times and establish a process to exchange information.

The Art of Networking

Networking events can include breakfasts, lunches, dinners; occur during business or after hours; and involve such activities as joining different types of organizations and associations. By mastering the art of networking, you will build a solid network of business and personal contacts, in place and at your disposal, whenever you may need them.

To network successfully, you should:

• Set a goal for people, cards, etc., whom you will call/follow-up.

• Never try to sell anything or appear to be ready to pounce on anyone who will listen.

• Always go to networking functions prepared to give leads to others as well as get them for you.

• Focus on asking people why they are there and what business they are in before you tell them about you and your business.

• Be prepared when you have the opportunity to present your initial contact statement.

Strategic Partnering

Forming alliances with other non-competing salespeople in your market can be very beneficial. You offer each other an opportunity to be introduced to the other’s prospects/clients. You and your strategic partners will both profit from this relationship.

Strategic partners include salespeople who sell:

1. Products/services that are non-competing in your market:

• Commit formally to introduce each other to key players among your client base.

• Meet regularly to exchange information.

OR

2. Complementary products/services that enhance your product/service:

• Less formal relationship.

• If and when appropriate, introduce/recommend each other’s products/services.

What should you look for in a Strategic Partner?

When creating a strategic partnership, the partners should address several issues to ensure the relationship could work. Be aware that some attempts could fade quickly. The first step is to identify the right strategic partners so you don’t waste time.

Ask yourself these questions:

• Do both partners have the same type of prospects/clients?

• Are both partners actively prospecting for new business?

• Does each partner provide a service or product that impacts the prospect?

• Are both sales representatives in consultative positions? If the potential partner is in a retail selling position, that normally leads to decisions based predominately upon price. This will usually not be a good “fit.”

2009 will have its own challenges for us all. The key is to have a prospecting plan that you will enact, maintain and analyze. This structured approach to any marketplace is essential for success no matter what the financial climate may be.

Does it really matter? …the health of your business will only be influenced by… your attitude, beliefs, and actions.

With a hard fought Presidential election just behind us, we still hear the ringing of and will continue to hear the question, “Are you better off today than you were four years ago?” I have a better question… and it has nothing to do with politics. Will you be better off four years from now than you are today? If you just answered, “I certainly hope so” or something less committed than “YES” – what influenced your response? Your attitude, your belief, or your actions?

Certainly, the health of our economy will be influenced by our leader in the White House. However, the health of your business will only be influenced by you…your attitude, beliefs, and actions. Will the economy expand or contract? Will interest rates rise or fall? Will it be large companies or small companies that thrive in the next four years? Do you know? Should you really care?

Expanding, contracting; rising, falling; large, small…it doesn’t matter. Those are generalizations based on a national composite in a global economy. These classifications don’t dictate growth or stagnation for you. Frankly, only you dictate growth or stagnation. Opportunities for YOUR business are almost limitless. When times are good (and you can define good any way you’d like to), companies are looking for increased efficiency. They want to reap as much as they can as quickly as they can…while the pickings are good. When times aren’t so good (again, you can define that any way you’d like to), companies are looking for increased effectiveness. They want to get a bigger piece of a smaller pie.

Let me qualify my previous statement: Opportunities for business growth are almost limitless…if you are prepared. Your ability to effectively respond to change—whether you see that change as good or not so good—is primarily determined by your level of preparedness. Joe Paterno said, “the will to win is important. The will to prepare is vital.”

So, how do you prepare for change and (continue to) grow? Objectively examine what you are doing and how well you are doing it. Are your selling, communication, and deliverable skills as well honed as they could be? How about your planning skills? What about your ability and discipline to follow up and follow through? Do you practice what you preach? How good of a role model are you for your sales staff and clients?

Here are some steps you can take. First, analyze your present situation. What are you really good at? At what do you excel? What are your real strengths? What are your unique skills, talents, and abilities? Knowing “what you have in inventory” is necessary for determining the most appropriate course of action when faced with change.

Next, determine what are you not so good at? What would you rather not do? What activities do you continually put off or avoid altogether? In other words, what are your limitations or weaknesses? When you’ve identified these “areas for improvement,” prioritize them from the perspective of which can enhance your strengths and which, if improved, can make the greatest positive impact on the accomplishment of your goals. Now you have prepared your inventory – how do you execute the change? Personal and corporate training is an effective avenue to learn how to leverage your strengths and re-work your weaknesses.

Another way to prepare is to learn to be flexible. Take the blinders off. Just because you’ve always done something one way—and it worked—doesn’t mean you’ll always be doing it that way. It takes a very close inspection to decide whether what got you here will get you there. A great place to start is by expanding your realm of influence to help you grow and prepare for change. It’s been said that in the business world, success is determined by whom you know. I suggest that it’s not whom you know, but who knows you. Are you “plugged in” to your business community? Do you contribute your time, energy, effort, and expertise to civic and business associations in your community?

If you find an organization whose goals and objectives are consistent with your goals and values, then get involved. Participate and add value to the relationship. Besides the personal growth, you’ll likely be rubbing elbows with the movers and shakers of your business community who share your goals and values.

Another way to prepare for the future is to examine what you have and where you are today. How many important business relationships do you have? How can you make them stronger? How many influential business contacts do you have? How can you make them more plentiful? Which of your current clients or contacts can introduce you to other influential people? And, when are you going to ask them to do so?

Will you be better off four years from now than you are today? If you are prepared for change and you are continuing to grow, the answer will certainly be yes.

The most important tools in marketing your company are the people representing you in your marketplace. Those most visible and usually the most important in the harvesting of your marketing efforts are your sales force. Wrong people … wrong results.

The real issue is how do we measure a prospective sales hire so we can feel we have hired the right person? Look at the criteria, work effort and skill sets that you know are necessary for success; then, manage to those criteria.

Our clients use an acronym to help them develop and drive the inspection of a new sales hire — SEARCH.

Skills – What skill sets are we looking for that directly relate to the job description?

Prospecting, phone skills, approaches used, decision maker contact, getting to the must reasons for working with a prospect, qualification, closing, and the ability to develop strong relationships quickly.

Experience – Actual experience in your market and in this position.

Has sold within the technical parameters required, background directly relates to industry; has sold at levels both in annual sales production and average per unit pricing; has been successful and understands the “Chain of Command” decision-making process of your market; is comfortable and understands the dynamic of your product sales cycle duration — multiple sales interviews versus single call closure.

Attitude – Belief in self and product benefit to clients.

Wealth orientation with desire to provide service to clients; entrepreneur versus employee mentality; sells based upon solution versus price; can sell beyond price; self and internal motivation.

Results – Has and can prove successful sales results at required volumes, pricing and consistency.

Compensation from past sales efforts directly relates to new opportunity; is a proven “Hunter – Killer” versus farmer or maintainer; can demonstrate easy navigation from the opening of a new business opportunity to closing; provides service level of deliverable and maintenance of new and established clients.

Cognitive Skills – Can learn quickly.

Ability to internalize products to market and understand the niche your product/service fills; has ability to communicate value of service and product beyond surface application; relates and projects ownership values; sells impact versus product.

Habits – Has goal and activity orientation.

Tracks new business activity and client development; creates and maintains written records directly related to goals; establishes and maintains game plan results for inspection and improvement.

The greater the candidate can validate the SEARCH criteria, the more likely you will have a successful hire!

The hostage syndrome is a very real and business-threatening series of attitudes, events and poor judgments that make us dependent upon people, resources, and or processes that limit and, in many cases, cripple the effectiveness of our business.

They become evident in:

· Financial returns and increased costs.

· Distribution.

· Vendor Requirements.

· Supplier requirements.

· Personnel.

Often it can be best described as making the best choice from a variety of poor options. Not that we don’t recognize the same, but rather we don’t perceive that there are any true alternatives to these choices, or that we are not willing to change the status quo because of an immediate negative result.

Poor perceived options are a direct result of pressure. Many times, the opportunity to relieve this pressure is self-evident, but the risk of doing so will cause disruption, additional work, cost in resources, and a drastic change in some cases.

Examples:

There is a vacancy in a department that requires a specific skill set to maximize the effort or result. Since there is pressure on a daily basis to have this position filled, we accept what we can find, versus being committed to seeking the right fit.

Effects:

· Increase costs in training.

· Slower work effort of the team process.

· Constant concern over quality and performance.

· Increased supervision.

· Client (internal or external) disappointment.

A supplier requires a sales presence in a territory for their requirements. We don’t have a qualified asset to provide that presence, so we settle to have an inferior resource. This settling for, rather than seeking for the right fit, puts the relationship in jeopardy and wastes time, effort and investment.

Through this settling process, we get and accept marginal results, which places stress on the relationship with the supplier, and loss of trust. Eventually, due to the pressure to comply and the inability to meet expectations, the relationship is placed in jeopardy, if not ultimately lost.

In the interim, we compound the effect by expending valuable time and support for an asset that may take many years to cultivate, if at all. Usually this won’t work, due to the pressure of production being time-bound.

Effects:

· Slow ramp-up to supplier’s expectations.

· Large cost in training, support, salaries, expense reimbursement.

· Eventual failure of the hire.

· Possible loss of supplier.

We have several marginal producers on board, and although they are paying for themselves, they are not achieving forecast. The fact that they are not achieving forecast means that they are not profitable. But what production is realized often is considered better than nothing, so we continue to allow the same to continue. By doing so, we enable these poor results and thus can be perceived as supportive of the same for the greater good. Unfortunately, this is harming the greater good.

Effects:

· Loss of profits.

· Increased costs.

· Negative impact on producers.

· Increased supervision requirements.

In production cases in which we are purchasing product, we accept poor quality, delayed delivery and inferior workmanship, due to cost and competitive pricing in order to address the market and to be topically price competitive. In these cases, the end user will only bear so much and then seek an alternative provider. At the same time, in order to make deliverable deadlines, we invest additional resources to make it right; retooling, driving margins and profits down, at the same time, deploying resources that often have originally been targeted for other required efforts increasing costs to fulfill promises made.

Effects:

· Key resources are diverted from other projects.

· Smaller projects are delayed or deadlines missed.

· Quality of smaller projects suffers.

A large opportunity presents itself that we know we can supply and will be profitable. In order to fill the contract, this opportunity requires an expenditure of the majority of resources that are available. In affect, the business becomes dedicated to the fulfillment requirements of one client. The account literally drives substantial income to our business and may be as much as 60-75% of our work effort. Our organization is now designed to fit this key client, and therefore, we become dependent upon the continued relationship.

Effects:

· In the creation of this dependency, we exhaust current resources and become comfortable in the arrangement, neglecting the original core business.

· We have created such a narrow focus that if the account is lost, it could cripple the business.

· New advances and/or techniques are not explored that would be essential in the overall marketplace.

We have a star producer who is exceptional in all but behavior and culture. This individual proceeds at their own pace and exhibits overt non-compliance, but they are the top producer. We look the other way and make excuses for the same, due to the affect they have on our bottom line revenue generation.

Effects:

· Culture is affected.

· Remaining producers become complacent and non-compliant.

· Overall morale, both in support and sales staff is affected.

· Overall production suffers.

There is another hostage situation that we also create. Small business owners may suffer the penny-wise dollar foolish syndrome. Instead of hiring resources that perform support and/or administration services, we elect to do these ourselves. We see this as a cost savings or that there is no one in the organization competent to complete these tasks.

Effects:

· Our number one resource, ourselves, is taken out of vital production and management roles.

· We increase investment of personal time working in the business.

· Micro-management occurs.

· Empowerment principles fall by the wayside.

Owners under pressure:

As in most situations in life, “We are our own worst enemies”. Pressure usually comes from inattention to details, lack of consistency, unclear policies and the making of exceptions. Usually the undertow of all of this is fear.  Culture, the creation and maintenance of the same is the key.

· Clearly state and broadcast culture.

· Do not tolerate exceptions to culture standards.

· Always keep your vision statement in mind.

· Make important decisions in a timely fashion.

· Develop an empowered workforce.

· Be the role model for accountability.

• I sell lawn maintenance services.
• We design point-of-sale solutions for multi-store retail operations.
• We provide accounting services for the hospitality industry.
• We custom design and fabricate outdoor signs.
• We sell and service large format document scanners.
• I sell advertising specialties.

What’s wrong with this?

The problem is that after awhile, all the descriptions start to sound the same. Not literally, but conceptually. The answers focus on the salesperson (or his/her company) and the product or service–not the needs or problems of potential customers.

By discussing solutions before identifying the need for a solution–a goal to be accomplished, a problem to be solved, or a challenging situation to be addressed–one fails to capture the prospects’ interest. Alternatively, if you bring the need to the forefront before discussing solutions, you elicit a different reaction. Rather than instinctively tuning out as soon as they hear “I sell…” or “We provide…,” potential prospects will at least listen to the description of the situation that your product or service addresses. At this point, they are now in a position to decide if they currently have a need for your product or service.

What should you do?

Preface your answer to “What do you do?” types of questions with a question or statement that focuses on the problem your product or service addresses. Here are some examples:

• You may be aware that large retail operations must keep a minute-by-minute account of their inventory to facilitate the coordination of purchasing and distribution in order to avoid out-of-stock situations. We design, install, and service point-of-sale inventory systems that allow them to accomplish the needed results.

• Have you ever wondered how people scan or copy large documents like 2 ft. by 3 ft. blueprints? We sell and service the equipment that allows them to perform a one-pass scan of these types of large documents.

You can introduce “needs” with other phrases such as, “Do you know how…,” “You probably haven’t thought about…,” or “Would you be surprised to find out…”

To get your prospects’ attention and arouse their curiosity, first focus on their challenges, then introduce your solution.