Business Performance coaching can help all aspects of your life
Closing More Sales by Letting “D” Class Prospects Go
You cant win them all.
Clare had been doing very well in sales. But she knew she could do better. So she called and asked for some help with business performance. I agreed she was a good coaching client and I could help increase her business performance.
She was making a reasonable living, but felt that she wasn’t focused. Wasn’t spending time, effort, and energy in the right places. Clare was running on two cylinders…which weren’t running very smoothly…and was making over £100,000.
For years she said to herself: “Imagine what I could do if only I could get focused and manage my time better. Then I could make some ‘real’ money.”
When I asked what her conversion rates were, she pondered the question for a few moments, and then said that she didn’t have the slightest idea. She had never kept any kind of statistical records.
We then asked more sales-related questions:
what is the size of your average sale?
how many sales did you make last year?
what was your biggest sale last year?
how much money did you earn on it?
what was your smallest sale last year?
how much money did you earn on it?
what is the profile for your ‘ideal’ client?
how many sales do you close on the first meeting/call?
the second? The third? The fourth, fifth, sixth, or tenth?
what is your best source for leads?
what are your sales, profit, and income goals for this coming year?
Clare thought about these questions for a few moments, and with a puzzled-look on her face, she said in a soft, quiet voice, “I don’t know the answers to most of your questions, but if you’ll wait a moment I can dig up the answers to the others, I just don’t have that information at my fingertips.
She continued, “As a matter of fact I was never much into record keeping. For the most part, I’ve just been flying by the seat of my pants.”
If you want to be successful, you must run your business, like a business. You need to know:
who are your best (most profitable) customers
where they came from
how much they spent with you
what are your most profitable products
the average value of your sales
your closing ratios.
You should have the answers to these questions at your fingertips, for without them, you’re flying blind into a sandstorm.
You’ve no idea what direction you’re going. (Last week a client reported that he’d run out of petrol while driving to an appointment. He’d been looking at the SatNav. Unfortunately, he’d forgotten to look at his fuel gauge.)
Because Clare didn’t keep any records, she didn’t know where she was, and as a result she didn’t know what changes she should be making in her business planning. She didn’t realise that you can’t win them all. How the class of your prospects influences your business performance
Over the next few weeks she started keeping sales records. Recording the names of the people she met with, what she thought they would purchase, the dates she met with them, whether or not they bought anything and the amount of the sale.
As we studied the records, we noticed something very interesting in the spreadsheet: Closure rate was about 23 percent of sales on the first call, 12 percent on the second, and 6 percent on the third call.
When she spoke with a prospect a fourth, fifth, or subsequent time, only 2 percent of those people ever purchased. And those that did were the smallest, least profitable sales.
Having been trained in the “everybody’s a prospect” school of selling and had always followed the “I’m going to call on them till they buy or they die!” sales methodology, it was difficult to alter her mindset.
She had the persistence of a bulldog. She refused to let go.
As Clare reviewed the records, she noted that she was closing 37 percent of opportunities on either the first or second call, and only 8 percent thereafter.
We considered this interesting fact, we talked about how much time she was investing in following-up on these opportunities. For the most part, the people who bought on the first or second meeting were typically rather easy sales. They were fun clients to work with, together with many of these customers becoming her friends too.
But the 63 percent who didn’t buy on the first or second call were typically much more difficult to work with. Never returned phone calls, or responded to voice or e-mail messages. Avoided or cancelled meetings. They just weren’t easy to work with.
I asked Clare, ”How much time are you spending chasing these people?” Because this is not time well spent.
She thought for a moment and said, “I’ve been spending almost 60 percent of my time chasing people who aren’t buying. And the few that do buy aren’t usually worth the effort…in that they don’t often become long-term customers. It’s almost like they’re giving me an order just to get rid of me.” Oh my, I can’t win them all. I should stop.
As she spoke, she appeared to have an “lightbulb moment .” A smile came across her face as she realized what had been keeping her from making the commissions she really wanted. She was wasting the majority of time chasing people who were never going to buy.
We then discussed the ‘novel’ notion of not calling the prospect after the second contact. If they haven’t bought, move on, looking for a better prospect. A prospect who’s in the market to buy from you, now. You can’t win them all. she hadn’t realised how the class of your prospects influences your business performance
Together we spent some time working on telephone techniques and helped her perfect her Elevator Speech. Correspondingly, her love for the job was reawakened.
And we spent time improving her networking skills so when she went to business and industry meetings she could meet more people, make more friends, find more opportunities, and close more sales.
Over the past few weeks, Clare’s results have been startling. Because she’s more focused on finding people who are in the market today, she’s not pushing on those that aren’t interested.
Now she using the telephone much more effectively to find prospects and qualify them. Her closing ratios have improved…and she’s making more money. to say nothing of the quality of her sales. Remember, you cant win them all.
And best of all, she’s got more time for friends, family, and herself. She’s no longer working harder, and she’s not just working smarter. She’s working less.