Thoughtful Thursdays - Is your business documentation in place?

Today's thought is directed towards, but not limited to, entrepreneurs in the start up phase of their businesses. It is often a task that gets taken care of after receiving the first order. Do you have all the necessary documents in place to process the order?

The downside of not being prepared can have disappointing consequences. These can vary from a lengthening of your your sales cycle to not being paid for products and/or services provided.
These consequences may be it is avoided with some forethought.

It is great to get the first orders, it is also beneficial to have a flawless transaction.

Do you have what you need?

• Applications for establishing credit
• Sales agreements
• Certificates of compliance
• Material Safety Data Sheets
• Instructions for use of the product
• Estimate forms
• Order forms
• Invoices
• Packing slips
• Bills of lading
• Customs paperwork
• Purchase orders
• Delivery receipts
• A way to keep it all organized

As basic as it may seem, it is surprising what is forgotten and left to chance. Be sure of your processes. In closing, it is also a good idea to test your processes before taking them live.

Good selling,
Richard

Thoughtful Thursdays - Crunch the numbers

This week I read and enjoyed a recent post on Sant's Messages That Matter titled Overcoming the Fear of Value, where the fear is identified as "value paranoia".

I strongly agree on importance of quantifying the value proposition and how critical it is to shortening the sales cycle.

If you can not place a dollar value, or propose a process to calculate and measure this value with your customer I expect you do not yet have enough information to advance to the proposal stage of your sales cycle or for some reason you are not ready to be accountable to your customer.

Whether you are providing a product or service, the value can be calculated and expressed as a dollar value or a percentage.

If your product can save production time, you can estimate annual savings based on time saved multiplied by hourly production costs.

A service offering may require a more collaborative effort to establish mutually agreed to metrics and a baseline to compare measured results, but you can still convert this to dollars and cents.

Also be mindful that there is a cost to taking on a new vendor. Setting up a new account, adding new SKU's or raw material numbers, modifying manufacturing orders are all tasks that require resources. The value you bring must take this into account as well.

Take the time to quantify the value, and the chances of a successful close will be significantly increased.

Good selling,
Richard

Thoughtful Thursdays - Why Leave YOUR Money on the Table? - A Rant for Canadian Small Business Start-Ups

Today's thought is more of a rant.

It always puzzles me when an owner of new small venture, operating as a sole proprietorship, resists setting up a basic business infrastructure at the outset. To be honest it really disappoints me when I hear the excuses. Here are two I have heard more than once.

• I'm waiting to get my first order before opening up an account for the business
  
• I don't have to participate in the GST, my sales are or will not be $30,000 a year

In my opinion, both are signs of a lack of commitment to the business idea. I have a lot of difficulty getting my head around the first one and the second is a huge red flag.

I agree that if your sales are below an annual rate of $30,000 the Government of Canada says you do not have to participate in the Good and Services Tax. What kind of message does that send to the customer? They aren't stupid, they will know you are a very small business and chances are you may not be around for long, especially if you expect the business to be self-sustaining. What is worse is that you are probably leaving money on the table - your money!

And what about HST? It is coming July 1, 2010.

Unfortunately many of the people that fall into this category are the ones who can least afford to throw money away, not that anyone can. Perhaps you think you are doing your customers a favour? You might be, but why at your expense? What happened to your value proposition?

If you are serious about starting a business and are thinking of not setting up a proper infrastructure for any reason, think again. Would you plant a garden, not water it and expect it to flourish?

Good selling,
Richard

Thoughtful Thursdays - What is sales?

Today's thought comes from a higher level view of sales. Rather than talk about tactics let's consider what sales actually is.

We know that the goal is to make a sale, but what does the sales process do?

It is described by many as the process that converts prospects to customers. I can not disagree with this; a successful close accomplishes exactly that. Depending on the business, this can take minutes or months, but this does not really answer the question posed.

Doesn't the sales process in fact facilitate another process - the buying process?

To facilitate is defined by Merriam-Webster as verb meaning "to make easier", or "help bring about." It then follows that sales is a process that helps others make a buying decision easier.

A learned colleague of mine allows me to use his words: "Stop selling and start helping."

Never forget that you are there to help make it easy for your prospect to say "yes" and craft your sales approach accordingly.

Good selling,
Richard

Thoughtful Thursdays - Following up is a matter of peristence and determination

In the early stages of the sales cycle, an incredible amount of time can be spent just getting in contact with the right people. Frustrating and discouraging as it may be, following up is a necessary step in the sales process.

Knowing when to follow up is just as important as the action itself. Leave it too long and you might find yourself having to start the sales cycle all over again. Too early and often can lead to ticking off your prospect. So when is a good time to follow up?

Depending on what you are following up on, the timing may be different. A rule of thumb that I use is one business week - no longer and sometimes shorter. If you are following up on a voicemail I would call again within 2 days.

What ever the case, the easiest way to avoid the worry about timing for the follow up is to set it up and communicate it in advance. If you have left a voice message, include when you are going to call back. If it is a letter, state when you are going to follow up. Be sure to do what you said and you will begin to develop trust with your prospect - you are following up on your commitments.

Never assume that your message is not being heard or your letters are not getting read. If you doubt your market research (identifying your target market) on the basis of not being able to get in contact with your prospects, you have successfully sold yourself out of a possible opportunity with unsubstantiated, but perhaps convenient untruths.

As I have said in previous posts, do not let yourself talk yourself out of doing what you know you should be doing. Leave those activities for your competitors to master.

Following up with confidence in the value you are representing will pay off.

Good selling,

Richard