#39: Sales pipeline

Over the past few articles we have been looking at the key components of your sales process, from identifying what a Salesperson actually does, the difference between the features and benefits of your product and why it is important to know these during meetings, and your USP.

Another thing you also need to manage your sales pipeline. Take a look at the two tables below:

The first one is very useful in anticipating your future cash flow. The first column is the prospect. The second column is the stage the relationship has reached. The third column is the estimated absolute size of the contract. The fourth column is the discounted “value” of the contract, with the estimated size multiplied by the percentage likelihood that the business is won.

By way of example, prospect I is at stage three, so there is a 20% likelihood that you win the business. The business is estimated to be worth £250, so the discounted value is £50.

Another way of looking at your pipeline is the second table. It’s the same sort of data re-sorted. It shows you how many names you have at each stage in the sales process, so it’s useful to estimate what volume of business is coming towards you from a resourcing standpoint.

If overnight everything moved from column five to column six you might think “how I am going to deal with this?” as they have all said yes at the same time.

You can also pick up on things that are stalling; if something has been in column five for ages you might ask yourself why, and investigate.

The key is how many names can you add to the first column, and how fast can you move them to the far-right column.

Try putting a table like this together and start sorting through your contacts, you might be surprised how far you have come with some of them. It will also weed out the time wasters and free up your time for people that actually want to work with you.

Remember, you can always get in touch with me for more help on this or anything else in my expert articles.

#38: Unique selling point

There are a lot of questions you’re inevitably going to get asked in business; “What is the aim of your business?”, “What are your key values and how do you meet them?”, “Where do you see your business in the next 5 years?”. Some of these you might find fairly easy to answer, maybe you have been asked them multiple times before, but some questions require a lot more thought.

One such question is when somebody says to you, “What is your USP”? It’s a horrible question to get, but sooner or later someone will ask you.

What makes you different? Why should I use you? USP in marketing terms is either unique selling point, or unique selling proposition. In today’s world I think that if somebody else is prepared to throw money or people at it, most USPs can almost certainly be replicated unless you have a secret formula.

I believe the definition of a USP is that it’s sustainable, defensible and genuinely unique, but if you look around today’s market there are not many products or services that hit those criteria. Nevertheless, if somebody says to you “What is your USP?” you need to have an answer. For most people the USP will be you, something about you and the way you transact business.

The next one is fielding the question: “How can you prove you can do what you say you are going to do?” This is a hard one to handle. Ways you can deal with this include:

• Do you have relevant qualifications that are evidence that you can do what you say you can do?
• Can you offer some sort of free trial which will make people comfortable?
• Can you get testimonials and references from either satisfied clients or, to buy you time in the early days, business contacts from your previous employment?

That brings us on nicely to sales methodologies, the first of which is the Sales Qualification Process.

This is one used by a former client of mine in the storage business.
The key purposes for this company were:

a. To profile the customers they wanted
b. To weed out any potential bad debts
c. To weed out any potential time wasters

A few remarks on each of the components:

• Source of lead or referral – where did the opportunity come from? Is it from a trusted source, who you know would only pass you a qualified opportunity, or is it a less trusted resource that may be passing you a problem?
• Potential size of transaction – if it’s huge, don’t just rub your hands together with delight; think about whether you can actually deliver or whether you would embarrass yourself if you could not cope. If it’s tiny, don’t decline out of hand; think about whether you are being tested, and if you do a good job will you get something more substantial down the line.
• Size of company – in days gone by the larger the company the more likely they would be there to pay you when you finish the work, but the current economic climate has indicated this is not necessarily the case. With smaller businesses you may want to check their ability to pay. There are credit checks you can do by using agencies that have access to the same databases that the banks have; they normally do debt recovery also! This is obviously for business to business.
• Identification of decision maker – nothing is more frustrating than pitching to the wrong person. If you have identified the decision maker – great; if not can you positively influence the person who is representing your interests to give a good account of your proposition? Make sure you understand the decision-making process
• Identification of budget – find out if your prospect has a budget. If the prospect has not allocated a budget, then how serious are they?
• Clarity of requirement – are you clear in your mind what the client wants and whether you can deliver it?
• Urgency of requirement – Is this mission critical for them or not? If it’s not, then if they get busy could it cease to be important?
• Finally, why are they talking to you? What has prompted them to contact you? Are they serious about getting a quote or are you just there to make up the numbers? If that is the case, you do not want to waste your time if there is no chance to win the business.

If you have gone through the qualification process and are still talking, and neither of you has “deselected” the other, then your prospect is going to be surprised if you don’t ask for the business.

#37: Sales – Part 2

Last week we looked at the first of two articles on sales, looking at how a ‘Salesperson’ is generally perceived and what I consider to be the three main attributes of a successful salesperson.

This week we are going to take a look at some of the things that can happen in sales meetings. Firstly, features and benefits.

You really need to appreciate the difference. A feature is what something does; a benefit is what it does for the client. The danger is that people tend to focus in client meetings about the features but not benefits, which reduces the number of sales they can get because it is the thing that is of least interest to the client but quite often the most interest to the seller.

If you have devised a funky piece of software, you want to tell everyone about it, but the client really does not care; they want to know what it does for them in their world.

When I did my sales training they had me selling a car. From memory I had to make the point that it was fitted with halogen headlamps (feature), which meant that it was safer to drive in the dark, (benefit).

Bearing in mind if it is a consumer sale the benefit does not have to be a financial one and, in this case, it was safety. I was paired up with the sales trainer who said he was an old man who did not drive at night; so I sold him a benefit that was completely irrelevant to him! But the point was made. If you then apply this to a business to business sale – you can begin to see how it works.

Imagine that you have just been appointed the UK head of sales for a company selling “hands-free” phone kits and you are calling on the manager of a big call centre. You demonstrate the hands-free kit and say that this means that the operatives in the call centre can work completely hands-free, and therefore complete more transactions per day, which means more money for the business. The key words are “which means” as they link the feature to the benefit.

They work every time. You have to talk about the features otherwise you can’t have a conversation, but you have to link why that is of benefit to the client. If you think about it, if you are not saying, “which means,” the client is thinking “so what”? It gets you from features to benefits. Trust it as a technique and it works.

Next time we will continue to look at sales, as lets face it they’re a big part of your business, but will concentrate on the Sales Pipeline. We have covered this before in a previous article, but I want to move back to this and go through it in more detail. It is very important!

Don’t forget you can always contact me if you would like any more advice or have any questions, I’m always happy to help.

#36: Sales – Part 1

Over the past few weeks we have looked at why small business fail, potential problems with business partnerships, and networking. The next key component is sales.

When I run my workshops I do a little word association exercise; I say one word and ask the delegates to write down the first thing that comes into their head.

The one word is “Salesperson” – the responses I generally receive are predominately negative, including words such as:

• Impolite
• Shallow
• Pushy
• Smoothie
• Aggressive
• Shark
• Bully
• Suit
• Sleazy
• Scumbag

It is fair to say that most of the words volunteered are not words that you would feel happy being used about yourself!

So, ladies and gentlemen, we have a challenge; if we are going to eat then normally we have to sell and yet we associate selling with pushy, sleazy scumbags in suits! So how do we do sales without having to risk ourselves being perceived as one or more of the negative images conjured up? I have to try to demystify the sales process for you and make it slightly less scary.

My personal view is there are three attributes of a successful salesperson:

1. The first attribute is the ability to be liked. If you consider your own experience, you are more likely to buy from somebody you like!

2. The second attribute is the ability to listen. There is a famous saying that God gave us two ears and one mouth and we should use them in that proportion, and this is absolutely true. The good salesperson asks the right questions then shuts up, and if you have asked the right questions and remain silent the client will tell you all you need to know. Some of the best salespeople I have encountered are amongst the quietest people I know.

3. The third one is to my mind the hardest one to handle, namely the ability to enter the client’s world, rather than try to drag the client into yours. That is where most people fall down.

When people get into the sales process and are in the thick of it, they get nervous and tense. When that happens, they revert to where they are comfortable, namely themselves and their business, and they stop talking about the client and his or her business.

What you are trying to do is solve their problem in their world. If you can master that, coupled with the other two attributes, then you have the main components of a good sales person. You still need a process to work with and some tools at your disposal, but in terms of a sound base, you will have it.

Next time we will continue to look at sales but concentrate on the features and benefits, both of which are very different. But we’ll get to that next time!

#35: Networking – Part 2

Today we are going follow on from my last article where we looked at the first type of networking – your existing network – and how to develop it further.

The second type of networking is opportunistic. You go to an event, an exhibition, or a trade fair, where you will have opportunities to “work the room”. You can talk to people – at registration, and in the breaks.

If you attend an event that is relevant to your business, in that room could be potential clients, competitors, potential service providers to you and people you can team up with. I have not gone to an event where I have not come away with at least two or three cards of people to follow up with, however good or bad the event was.

The third category is planned networking. This is where you join a networking group for the specific purpose of building relationships and promoting your business. The only one I have time to do now is the Gatwick Diamond Business Association, which meets once a month. The website will give you a pretty good idea of what an organised networking group is all about.

Other networking groups are run by Chambers of Commerce, BNI and the IOD. For the ladies there is one which is called “Women in Business”. It’s worth going along as a guest/visitor to a few events to gauge which ones suit you best.

Once you have made a decision you will need to stick at it though, as it takes time to build trusted relationships. They are all variations on a theme, and generally give you an opportunity to tell your story to either your table, or the full group, depending on how many attendees there are.

This usually takes the form of an “elevator pitch”. An example of what I might say is displayed below:

Good morning everyone, my name is David Mellor from David Mellor Mentoring, based in the Gatwick Area.

• What do we do? We help business owners make more money and free up their time.

• How do we do that? We take them out of their natural habitat, we help them review where their business is, identify where they would like to take it, but most importantly we work alongside them for as long as it takes to help them get there.

• Benefits for them are that it puts them back in control of their business, and it gives them a direction and a focus, all of which lead to increased profitability.

• Typical issues that we find are that they are working far too many hours, they are not making enough money, they don’t trust any of their staff to do the job as well as they can and quite often they are lonely.

So if you know any business owners that show any of those symptoms, I would love to hear from them; just remember my name is David Mellor from David Mellor Mentoring in the Gatwick area – you have my contact details on my card.

Oh and don’t forget – you don’t want to end up like Christopher Columbus, who when he set off did not know where he was going, when he got there he did not know where he was, and when he got back he did not know where he had been. He did it all with somebody else’s money, but you probably don’t have that luxury. Thank you.

In an elevator pitch you tell people who you are, where you are based, what your business is, what you do, what makes you different, the kind of clients you are looking for, a reminder of how to contact you and finally some kind of memory hook or strap line which makes you memorable – in my case the Columbus story!

#34: Networking – Part 1

Gathering business contacts to create a valued network can take time, as not everyone will be on the same page as you in terms of what they want and need. Some people will be on board from the start, others will need a bit more convincing.

The obvious place to start is your existing network of family, friends, neighbours and people who you have worked with in your career thus far. What I suggest you do is collect all the names on an excel spreadsheet (particularly the work contacts) and classify them 1 – 5.

1. People you are convinced will buy from you at some stage in the future.
2. People you are pretty certain will buy from you but you are not quite so sure.
3. People who realistically are never going to buy from you but you like them, they are well networked, and they are useful for market intelligence.
4. People where you really have no idea whether they are potential buyers or not.
5. People you consider to be irrelevant in your new world.

Having numbered them, you should immediately archive the 5s; the 4s and the 2s. The next stage is to create a diary system where by you get in touch with them every other month; the 3s you do the same with but on a quarterly basis; and the 1s you find a reason to be in touch with once a month without irritating them.

By the end of Year 1, you should only have 1s and 3s left. The 2s will become 1, 3 or 5s, same with the 4s. The 5s have already been archived. You can still be reactive towards the 5s, but you cannot afford to spend time on them; you have to spend time on those who are the most relevant.

You also need to have enough time to add new and highly relevant people to your network. There is nothing to stop you getting on and doing this now! You don’t have to wait as you know who they are.

This forms the basis of your business network, the key is to keep it updated and continue to add new people to your lists. The more you have, the more chances there are of making a sale, increasing not only your profit but also how many people hear about your business.

#33: Awareness

Now that you have learnt how to successfully structure and run your business, as well as hearing some horror and success stories of business partnerships, you should be in a place where you are ready to get your business out there.

Let’s try a little mental exercise:

Today is “Launch Day” – you have opened for business today, but no one out there knows you exist. So what are you going to do to let them know? What you can do probably depends on what your business is, but will be a “cocktail” of the list below:

• Word of mouth
• Launch party
• Flyers
• Press release
• Promotional offer
• Trade show/exhibition
• Advertising
• Business cards
• Traditional networking
• Website
• Brochures
• Social networking – e.g. LinkedIn
• Promotional gift or gadget
• Direct marketing (mail, e-mail, telephone)

Networking is so important it will have its own section shortly.

And a few words on websites: Five years ago I would have said that a website was a “nice to have” on launch day, as opposed to a “need to have”. Things have moved on and if you are going to be taken seriously you really need one, however minimalist.

There are two reasons for this. Firstly, if you launch your business and don’t have a website you run the risk that your potential clients will question your seriousness. Secondly, increasingly it is becoming the icebreaker conversation if you are meeting somebody new. If I meet somebody at a networking event, and we agree to meet up at a later date, the opening conversation at the subsequent meeting often relates to the website. If you don’t have one you take away the icebreaker conversation.

Routes to Market

• You should have more than one of these. The obvious route to market is people who will buy direct from you, or direct marketing.

• The second route to market is people who will refer prospects to you, in the expectation that you will do the same for them, also known as reciprocal indirect marketing.

• The third route is people who would be prepared to sell on your behalf, i.e. they would introduce clients to you but they would expect to be paid in some way. This is what we call fee-based indirect marketing.

• The fourth route is people who do something that is either similar to you or complementary to you, with the result that you can sell alongside them and the two of you can win business together that you could not win on your own. You each help the other.

• And finally, the fifth route is networks that you could join with the specific purpose of building relationships and promoting your business. This would be the biggest change for most people, but it could also well be your biggest source of business.

Which takes us on to networking…something we will cover in the next article! Until then you can always contact me with any queries you have on routes to market and launch days.