Your goal for every customer should be to turn them into a customer for life, a popular concept that’s made the rounds in the last few years. Bowl them over with your service. Become such an integral part of their company that you have your own desk in their office. Know their needs so intimately that you develop solutions before the customers even discover the needs themselves.
Out of all your customers, you won’t have very many with that kind of relationship, but when you do, you’ll profit from it. I’ve been fortunate enough to have a handful of such customers with whom I’ve done business both when I worked for other companies and after I started my own. A few of them have represented millions of dollars in income over the years. You can enjoy the same kind of long-term relationship with your best customers if you practice just one thing: never stop selling them.
They may become your friends; in fact, I hope they do. They may come to rely on your service or products to the exclusion of all others. They may tell you that they’ll always be your customers and sign long-term contracts to prove it. But if you take them and their business for granted, you’ll regret it someday.
You’ll also be sorry if you rely on them as your sole or main source of income. Having one dominant customer is a dangerous situation because there are too many variables outside your control—and theirs. “For life” is a long, long, time.
Situations and people change. What was the foundation for a wonderful relationship two years ago may not mean anything today. Your relationship with your customer for life has to develop and change the same way your relationship with your spouse or significant other evolves over time. That’s the only way the relationship will stay vibrant, alive, and satisfying to both of you.
So never stop selling them. Every time your company comes out with a new product or service, pitch it to your current customers first. If it’s really a “new and improved” model, don’t you owe it to them? If there’s a limited supply, shouldn’t your best customers get first shot at it? That should be one of their rewards for being a loyal customer.
And always look for ways to add value to their current purchases from you. If your company sees fit to offer an inducement to new customers, shouldn’t your best current customers get the same deal? It’s a real slap in the face if they don’t. And if the new business incentive is a small price to pay for a new account, it’s an even smaller price to pay to keep a current one. That’s one of the management dilemmas behind sales promotions.
Dave Donelson distills the experiences of hundreds of entrepreneurs into practical advice for business owners and managers in the Dynamic Manager's Guides and Handbooks, a series of how-to books about marketing and advertising, sales techniques, and management strategy.
Showing posts with label time management. Show all posts
Showing posts with label time management. Show all posts
Friday, March 15, 2013
Friday, March 8, 2013
Existing Customers vs New Prospects
Your current customers are your best single source of new business. They know you, they know your product, they have demonstrated their willingness to purchase. What’s more, you know them, you’ve learned about their needs, and you’ve invested a significant amount of your time in the success of their business. You should work to protect that investment and encourage it to grow the same way you manage your investment portfolio, making adjustments periodically to maximize the return on your investment.
Your current customers are also your company’s most profitable customers. The heavy start-up costs have been absorbed and written off already. The current customers have passed the credit checks, had their account data fed into your computer, been educated about your billing practices, learned how to use your customer support and service staffs, and otherwise incurred the typical back-office expense necessary to start doing business with a new account.
They’ve probably also passed the most expensive stage of incurring initial selling costs. You’ve used the get-acquainted offer, the short-term trial contract, and the sales promotion expense to bring them into the company. You’ve done your basic research, invested your time in preparing the initial proposals, tracked down the decision-makers, and made all the follow-up presentations to make the first sale. Once you’ve done these things, you generally don’t have to do them again. You can skip or abbreviate at least some of these time-expensive tasks.
You can concentrate on keeping the current customer happy and increase your business with them while you go about developing other new accounts. As you’ve probably guessed by now, you have to do both tasks to build a successful account list or territory. There is no rest in sales unless you decide you’re not going to grow your business both ways. And if that’s your decision, you’ll have plenty of time to rest—in the line at the unemployment office.
Dave Donelson distills the experiences of hundreds of entrepreneurs into practical advice for business owners and managers in the Dynamic Manager's Guides and Handbooks, a series of how-to books about marketing and advertising, sales techniques, and management strategy.
Your current customers are also your company’s most profitable customers. The heavy start-up costs have been absorbed and written off already. The current customers have passed the credit checks, had their account data fed into your computer, been educated about your billing practices, learned how to use your customer support and service staffs, and otherwise incurred the typical back-office expense necessary to start doing business with a new account.
They’ve probably also passed the most expensive stage of incurring initial selling costs. You’ve used the get-acquainted offer, the short-term trial contract, and the sales promotion expense to bring them into the company. You’ve done your basic research, invested your time in preparing the initial proposals, tracked down the decision-makers, and made all the follow-up presentations to make the first sale. Once you’ve done these things, you generally don’t have to do them again. You can skip or abbreviate at least some of these time-expensive tasks.
You can concentrate on keeping the current customer happy and increase your business with them while you go about developing other new accounts. As you’ve probably guessed by now, you have to do both tasks to build a successful account list or territory. There is no rest in sales unless you decide you’re not going to grow your business both ways. And if that’s your decision, you’ll have plenty of time to rest—in the line at the unemployment office.
Dave Donelson distills the experiences of hundreds of entrepreneurs into practical advice for business owners and managers in the Dynamic Manager's Guides and Handbooks, a series of how-to books about marketing and advertising, sales techniques, and management strategy.
Monday, September 5, 2011
Every Business Needs A Plan For Success
A business plan is your map to the money. It tells you where you’re going to get it and how much of it you’re going to be able to keep. And just like any map, the more detail the plan has, the easier it makes it to get to your destination.
Do you need a business plan? Would you hire someone to remodel your kitchen who didn’t have a set of blueprints? I’m sure you wouldn’t think of it. So why run a business without a plan? Unfortunately, it happens all the time, which may be the reason well over 500,000 businesses fail every year.
Most of the small business owners I deal with really know their craft. They know what materials to use, which vendors offer the best terms, which customer is most likely to complain, and so on. They’re also pretty good business people. They understand controlling expenses, tracking labor and material, and pricing their product to make a profit. They work hard and are justifiably proud of the results.
Their business plans, though, all too often sound like “If I build it, they will come.” That may work in the movies, but it stands as much chance for success as a plan to install a tonneau cover that doesn’t include the model number of the truck.
If you expect to run a profitable business, you need a business plan for many of the same reasons you need a plan to remodel a house. It helps you focus on the important factors that contribute to success. It helps you make key decisions on everything from the types of work you look for to the number of employees (if any) that you hire. A sound business plan is also an absolute must if you are looking for capital, whether it be from investors, banks, or even suppliers.
A concrete business plan identifies the customers, quantifies the sales they will produce, and analyzes how profitable those sales will be. It’s like a job estimate that begins at the end of the process (the sale to the customer) and works backward. It helps you determine how much material to order and how much labor to plan on, project the costs, and figure out whether the job will be profitable at the price quoted. Only, instead of doing it on a job-by-job basis like an estimate, the business plan does it for your company as a whole over a period of time.
A business plan isn’t really about what kind of work you’re going to do or how much shop space you need. Those are elements of it, but they are so minor that they’re almost footnotes. There are five basic components:
1. Business Description – A short statement about why the business exists and what it hopes to accomplish. Generally, the more specific—and shorter—the better.
2. Marketing Plan – Answers the questions about how the business will be successful. Who is going to buy the product or service? Why? What need does it satisfy? How many potential customers for it are there? How often will they buy? What are their competitive alternatives? What price will they pay? How will they know about it? How will you get it to them?
3. Financial Plan – Shows the expected financial results of the marketing plan. How much income will be produced? What net worth will be generated? Who will receive that income (you or the bank)?
4. Cash Flow Plan – The step-by-step instructions for generating cash and keeping it. How will the working assets be acquired? When will operating cash be needed? How soon will profits appear? What happens until then?
5. Management Plan – Describes the shop owner or manager’s role in the business. Who will do what? What are their qualifications? How much training expense and time is required? How much time will be devoted to production, marketing, and administration? It also includes contingency plans for events like natural disasters, up- and downturns in the economy, and competitive changes.
This very brief description of each component is not at all complete but it should give you a flavor of what kind of information, hard data, guesstimates, and reasoning go into the business plan. Most of all, a good business plan needs to be grounded in reality, not wishes. I like to say that it should produce an optimistic outlook based on pessimistic expectations.
Preparing a good plan doesn’t happen over a lunch hour. It requires research and thought. Sound business plans can come in many forms, but they all have one thing in common: they are in writing. Whether you use one of the many good software packages available or fill up a loose-leaf binder with pencil-written notes, the act of writing it down forces you to give your plan the time and thought it deserves.
Dave Donelson distills the experiences of hundreds of entrepreneurs into practical advice for small business owners and managers in the Dynamic Manager's Guides, a series of how-to books about marketing and advertising, sales techniques, motivating personnel, financial management, and business strategy.
Do you need a business plan? Would you hire someone to remodel your kitchen who didn’t have a set of blueprints? I’m sure you wouldn’t think of it. So why run a business without a plan? Unfortunately, it happens all the time, which may be the reason well over 500,000 businesses fail every year.
Most of the small business owners I deal with really know their craft. They know what materials to use, which vendors offer the best terms, which customer is most likely to complain, and so on. They’re also pretty good business people. They understand controlling expenses, tracking labor and material, and pricing their product to make a profit. They work hard and are justifiably proud of the results.
Their business plans, though, all too often sound like “If I build it, they will come.” That may work in the movies, but it stands as much chance for success as a plan to install a tonneau cover that doesn’t include the model number of the truck.
If you expect to run a profitable business, you need a business plan for many of the same reasons you need a plan to remodel a house. It helps you focus on the important factors that contribute to success. It helps you make key decisions on everything from the types of work you look for to the number of employees (if any) that you hire. A sound business plan is also an absolute must if you are looking for capital, whether it be from investors, banks, or even suppliers.
A concrete business plan identifies the customers, quantifies the sales they will produce, and analyzes how profitable those sales will be. It’s like a job estimate that begins at the end of the process (the sale to the customer) and works backward. It helps you determine how much material to order and how much labor to plan on, project the costs, and figure out whether the job will be profitable at the price quoted. Only, instead of doing it on a job-by-job basis like an estimate, the business plan does it for your company as a whole over a period of time.
A business plan isn’t really about what kind of work you’re going to do or how much shop space you need. Those are elements of it, but they are so minor that they’re almost footnotes. There are five basic components:
1. Business Description – A short statement about why the business exists and what it hopes to accomplish. Generally, the more specific—and shorter—the better.
2. Marketing Plan – Answers the questions about how the business will be successful. Who is going to buy the product or service? Why? What need does it satisfy? How many potential customers for it are there? How often will they buy? What are their competitive alternatives? What price will they pay? How will they know about it? How will you get it to them?
3. Financial Plan – Shows the expected financial results of the marketing plan. How much income will be produced? What net worth will be generated? Who will receive that income (you or the bank)?
4. Cash Flow Plan – The step-by-step instructions for generating cash and keeping it. How will the working assets be acquired? When will operating cash be needed? How soon will profits appear? What happens until then?
5. Management Plan – Describes the shop owner or manager’s role in the business. Who will do what? What are their qualifications? How much training expense and time is required? How much time will be devoted to production, marketing, and administration? It also includes contingency plans for events like natural disasters, up- and downturns in the economy, and competitive changes.
This very brief description of each component is not at all complete but it should give you a flavor of what kind of information, hard data, guesstimates, and reasoning go into the business plan. Most of all, a good business plan needs to be grounded in reality, not wishes. I like to say that it should produce an optimistic outlook based on pessimistic expectations.
Preparing a good plan doesn’t happen over a lunch hour. It requires research and thought. Sound business plans can come in many forms, but they all have one thing in common: they are in writing. Whether you use one of the many good software packages available or fill up a loose-leaf binder with pencil-written notes, the act of writing it down forces you to give your plan the time and thought it deserves.
Dave Donelson distills the experiences of hundreds of entrepreneurs into practical advice for small business owners and managers in the Dynamic Manager's Guides, a series of how-to books about marketing and advertising, sales techniques, motivating personnel, financial management, and business strategy.
Thursday, June 2, 2011
Sharpen Your Sales And Management Skills
How can 13 be a lucky number? When it's the number of Dynamic Manager Handbooks now available as ebooks. The really lucky number, though, is 99 cents. That's the low, low price of these valuable management aids!
The Dynamic Manager Handbooks are for entrepreneurs, managers, and others who want to succeed in small business by learning more about management techniques, operations, and best practices. Each volume in the collection is devoted to a single topic. The material was extracted from the Dynamic Manager Guides, my series of books based on my experiences as a business journalist, consultant, and entrepreneur.
The Dynamic Manager Handbooks are available in formats for all popular ereaders, including your Amazon Kindle, Barnes & Noble Nook and many others at Smashwords.com
Titles currently available in the series
Sales Promotions: The Dynamic Manager's Handbook of 23 Ad Campaigns and Sales Promotions You Can Use
Customer Relations: The Dynamic Manager's Handbook of Customer Satisfaction
Sales Time Management: The Dynamic Manager's Handbook on How To Increase Sales Productivity
First Call Selling: The Dynamic Manager's Handbook on How To Make Sales On The First Call
Five Rules of Advertising: The Dynamic Manager's Handbook of Small Business Advertising
Marketing In Cyberspace: The Dynamic Manager's Handbook of Social Media Marketing
Beat The Big Box: The Dynamic Manager's Handbook of Winning The Retail Battle
Promotion and Public Relations: The Dynamic Manager's Handbook of Alternative Ways To Build Your Business
Customer Service: The Dynamic Manager's Handbook on How To Build Customer Loyalty
Making Sales Appointments: The Dynamic Manager's Handbook on How To Reach Prospects
Closing The Sale: The Dynamic Manager's Handbook on How To Make Sales Happen
Retail Selling: The Dynamic Manager's Handbook on How To Increase Retail Sales
Overcoming Objections: The Dynamic Manager's Handbook on How To Handle Sales Objections
There are many more sales and management skills to be covered, so visit your favorite ebook seller often to find the latest Dynamic Manager Handbook.
Dave Donelson distills the experiences of hundreds of entrepreneurs into practical advice for small business owners and managers in the Dynamic Manager's Guides, a series of how-to books about marketing and advertising, sales techniques, hiring, firing, and motivating personnel, financial management, and business strategy.
The Dynamic Manager Handbooks are for entrepreneurs, managers, and others who want to succeed in small business by learning more about management techniques, operations, and best practices. Each volume in the collection is devoted to a single topic. The material was extracted from the Dynamic Manager Guides, my series of books based on my experiences as a business journalist, consultant, and entrepreneur.
The Dynamic Manager Handbooks are available in formats for all popular ereaders, including your Amazon Kindle, Barnes & Noble Nook and many others at Smashwords.com
Titles currently available in the series
Sales Promotions: The Dynamic Manager's Handbook of 23 Ad Campaigns and Sales Promotions You Can Use
Customer Relations: The Dynamic Manager's Handbook of Customer Satisfaction
Sales Time Management: The Dynamic Manager's Handbook on How To Increase Sales Productivity
First Call Selling: The Dynamic Manager's Handbook on How To Make Sales On The First Call
Five Rules of Advertising: The Dynamic Manager's Handbook of Small Business Advertising
Marketing In Cyberspace: The Dynamic Manager's Handbook of Social Media Marketing
Beat The Big Box: The Dynamic Manager's Handbook of Winning The Retail Battle
Promotion and Public Relations: The Dynamic Manager's Handbook of Alternative Ways To Build Your Business
Customer Service: The Dynamic Manager's Handbook on How To Build Customer Loyalty
Making Sales Appointments: The Dynamic Manager's Handbook on How To Reach Prospects
Closing The Sale: The Dynamic Manager's Handbook on How To Make Sales Happen
Retail Selling: The Dynamic Manager's Handbook on How To Increase Retail Sales
Overcoming Objections: The Dynamic Manager's Handbook on How To Handle Sales Objections
There are many more sales and management skills to be covered, so visit your favorite ebook seller often to find the latest Dynamic Manager Handbook.
Dave Donelson distills the experiences of hundreds of entrepreneurs into practical advice for small business owners and managers in the Dynamic Manager's Guides, a series of how-to books about marketing and advertising, sales techniques, hiring, firing, and motivating personnel, financial management, and business strategy.
Tuesday, May 10, 2011
Time Management
From a practical standpoint, you don’t have 24 selling hours in a day. You don’t even have eight. I estimate that most salespeople can count on no more than five hours and 30 minutes daily when they can expect to make face-to-face presentations. This is due mainly to the availability of your prospects and customers. Even if you work an 8 AM to 6 PM ten-hour day, you’ll probably not be able to get more than five and a half hours in front of prospects.
Occasionally, of course, you’ll have breakfast and lunch meetings with customers, squeeze in one last call at 4:45 PM, etc. But for the most part, you’ll find it difficult to consistently make appointments with anyone before 9:30 AM because your prospects are busy organizing their own day (which does not revolve around you). Much the same holds true for lunch, which seldom starts at noon or lasts exactly an hour for most decision makers and influencers.
Here’s what a typical sales day looks like:
8 – 9:30 AM Arrive at office, attend meetings, organize day, leave for first call
9:30 AM – 12 PM Prime Sales time
12 – 1:30 PM Lunch, return phone calls, paperwork, leave for calls
1:30 – 4:30 PM Prime Sales time
4:30 – 6 PM Return to office, return phone calls, attend meetings, paperwork
As you can see, you have five hours and 30 minutes of prime selling time in the day. How do you maximize it? Using the priority system you’ve set up, you have to plan your activities.
“Plan your work and work your plan” is yet another “golden oldie” sales adage. And it’s a good one because it describes the essence of sound time management. It’s not enough to lay out a plan, you have to execute it to get any benefit from it. In fact, if you don’t “work your plan,” you’ve wasted the time it took to draw it up.
You can spend a lot of time planning. You can also invest hundreds of dollars in account management software and cross-indexed leather-bound time management systems. Or you can make up a “to do” list on a napkin at the coffee shop where you start your day. These are all planning systems that can work. I suggest trying something in between.
You need both long-term and short-term plans. Or call them strategic and tactical plans, if you have a military frame of mind. Which one is more important? Neither. They serve two distinct but equally important purposes.
Dave Donelson distills the experiences of hundreds of entrepreneurs into practical advice for small business owners and managers in the Dynamic Manager's Guides, a series of how-to books about marketing and advertising, sales techniques, hiring, firing, and motivating personnel, financial management, and business strategy.
Occasionally, of course, you’ll have breakfast and lunch meetings with customers, squeeze in one last call at 4:45 PM, etc. But for the most part, you’ll find it difficult to consistently make appointments with anyone before 9:30 AM because your prospects are busy organizing their own day (which does not revolve around you). Much the same holds true for lunch, which seldom starts at noon or lasts exactly an hour for most decision makers and influencers.
Here’s what a typical sales day looks like:
8 – 9:30 AM Arrive at office, attend meetings, organize day, leave for first call
9:30 AM – 12 PM Prime Sales time
12 – 1:30 PM Lunch, return phone calls, paperwork, leave for calls
1:30 – 4:30 PM Prime Sales time
4:30 – 6 PM Return to office, return phone calls, attend meetings, paperwork
As you can see, you have five hours and 30 minutes of prime selling time in the day. How do you maximize it? Using the priority system you’ve set up, you have to plan your activities.
“Plan your work and work your plan” is yet another “golden oldie” sales adage. And it’s a good one because it describes the essence of sound time management. It’s not enough to lay out a plan, you have to execute it to get any benefit from it. In fact, if you don’t “work your plan,” you’ve wasted the time it took to draw it up.
You can spend a lot of time planning. You can also invest hundreds of dollars in account management software and cross-indexed leather-bound time management systems. Or you can make up a “to do” list on a napkin at the coffee shop where you start your day. These are all planning systems that can work. I suggest trying something in between.
You need both long-term and short-term plans. Or call them strategic and tactical plans, if you have a military frame of mind. Which one is more important? Neither. They serve two distinct but equally important purposes.
Dave Donelson distills the experiences of hundreds of entrepreneurs into practical advice for small business owners and managers in the Dynamic Manager's Guides, a series of how-to books about marketing and advertising, sales techniques, hiring, firing, and motivating personnel, financial management, and business strategy.
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