If you’re in sales or a small business owner you may one day find yourself facing a situation similar to what Seth Godin describes in his blog today.
The bottom line of Seth’s post is that you don’t want to hesitate to give someone the opportunity to make a lot of money if you’re also making a lot of money. For example, why would you want to put a limit on commissions when for every $1000 the salesperson makes you make $5000? This is another example of what should be common sense in sales and small business. However, too often greed on the part of the company sets in and kills the deal. Seth’s example of the Dr. Dre headphones is a good example.
From a personal standpoint, I can tell you many stories of companies who decided to pay my company a flat fee instead of allowing us to assume part of the risk with them because they realized we were likely to be very successful and they didn’t want to pay out large commissions while forgetting they would be making large profits as a result. It happens more often than you would imagine.
I could also tell you a story (if I was allowed too) about a big software company that entered into a contract with a small sales and marketing company to split the profits on all sales on a suite of products that the company had deemed to be dead or dying off. The sales and marketing company was so successful they hit their 3-year contractual sales requirement in the first 9 months. Instead of being ecstatic, the software company looked at the huge checks it was writing to the sales and marketing company and said they wanted to cancel the contract – without cause. After much discussion and, of course, attorneys and legal fees, the big software company won. They succeeded in killing the golden goose.
Don’t be like this company. Let people share in the risk and have the opportunity to excel. If they win – you win. And, nothing motivates people more than being responsible for their own rewards – especially if those rewards have an exceptional upside.
Oh, and should you ever have the opportunity to enter into a similar Dr. Dre or a sales and marketing like contract, I have one suggestion I hope you take. Spend your money on a good attorney before you sign anything. If you don’t you may find yourself spending a lot more if things ever fall apart.
Another sales secret is that it is possible for your business to be too small or too big. Your goal should be to have it just the right size to meet your sales objectives and to be able to scale up or down as necessary.
I once bought a retail fishing store (long and funny story) only to learn by experience that it fell into the too small – too big scale. Because of the size of the facility, I needed employees but because it just wasn’t big enough in physical size, I wasn’t generating enough revenue and the employees could not be as sales efficient if the store were bigger and could stock more and larger products.
My choices were very limited. I had a lease I could not get out of and I could not physically expand. I could have cut the space in half and run it myself but that would have meant cutting inventory to fit in the physical space and customers would likely go elsewhere. And, I wasn’t interested in running it myself.
So, I closed it up and took my lumps. But, the lumps were smaller than if I had tried to continue down the same path. And, I learned some great lessons about retail that I now pass on to clients and friends.
I’ll share the most important retail lesson I learned. Don’t sell products that can be bought more cheaply at big box stores or online from Amazon.
Take the fishing store for example. You could buy anything we sold from Bass Pro Shops, Cabelas, or even the local Wal-Mart for 15% – 30% less. We tried to compete with this by offering more value in the way of service and education. We had frequent free seminars on certain aspects of fishing like using downriggers for salmon on the Great Lakes. We figured we’d sell a lot of downriggers. But, what actually happened is the customer attended the free seminar and then went to one of the big stores we he could look at all types of downriggers and use the knowledge we gave him to pick from mass of options – options we could not stock or show.
So today’s small business small secrets are:
You can be too big or too small of a company. If that is happening don’t hesitate to scale up or down or else you’ll fail.
Don’t sell anything that is viewed as a commodity and can be bought for a lot less online or at a big box store.
There are many, many secret for sale success for small businesses that I’ve either learned from a Sales Wizard over the years or through my own trial and error. The first secret for small business success is to remember you are a small business. Don’t try and act like a large one even if that is your goal – at least until you’re ready. Thing big but act small. Here are some more that should be present in your small business.
You’re nimble. You can make decisions quickly and change directions on a dime.
You can keep costs low. Your start-up is much less costly than what it cost not too many years ago.
My favorite is you engage in collaboration and not competition.
You’re not surrounded by naysayers with different agendas.
You’re more innovative than 99% of large companies.
You can quickly become a leader within your tribe and community.
As typical non-conformists you are superb idea creators.
Your leader is involved in client interaction giving you a tremendous advantage over faceless large companies.
You don’t engage in CYA as the buck really does stop with you so you can think big without the fear of making a mistake.
You can create openness throughout the organization.
You can create, participate in, and track remarkable – even extraordinary – experiences for your customers.
If you’re a small company and you don’t see all of these ten in your business it’s time to reassess if maybe you’ve lost sight of why you started your small business and where you’re headed.
This is the beginning of the small business sale success secrets that I and the Sales Wizard will be sharing with you over the coming weeks. Let’s make it a two-way conversation and share your sales secrets too. Remember openness is key for us.
The kind of laughter that leaves you in tears and your lungs gasping for breath. They are as contagious as a yawn and so much more conducive to feeling better. I don’t know about you but I feel fantastic after a good laugh. Long-distance runners talk about the marvelous benefits of endorphins relieving pain. I’ll take fifteen minutes with someone really funny over an hour of running any day for pain relief. And, I won’t have to worry about being chased by dogs or bad weather.
My friend Walt who has the timing of a stand-up comic and an ability to riff for hours makes my wife, Joann, laugh so much that she ends up putting her hand up and begging him to stop as she can’t take anymore.
It’s like being tickled without being physically touched.
I have a number of alerts set to let me know the latest news and articles about things I find interesting:
Sales and Marketing
Video and Still Photography
And a bunch more.
Without a doubt though some of the best laughs I get during the day happen when I read stories (sometimes disguised as news) about Mobile Technology.
You’re probably thinking Bob really is a geek if this is how he gets his laughs. And, you might be right but how can you not laugh when in the same set of alerts at the same time I get articles that totally contradict each other.
One will state how Android based phones have replaced the iPhone and is stealing all its customers. PC Magazine and CNET are always good for conflicting artilces. Another will state that iPhone is the king and Android will always be catching up. Just now there is an article letting me know Nokia has officially surrendered its smart phone lead to Apple. I think the unofficial belief is that happened some time ago.
Another writer in India just informed me that the key to stopping the BlackBerry death spiral is color. That’s right. All they had to do was throw off the marketing yoke of Henry Ford and make it in some color other than black.
I think many of these articles and news stories get written based on information from “reliable sources” and offshore suppliers who have “inside information.”
Originally I was going to call this post “You Can’t Make This Stuff Up.”
And, then I realized as I was writing it – maybe they do.
I very rarely go to a mall. Truth is I rarely go shopping unless it is online. But every once in a while when I’m out of town on business I’ll find myself at a mall. One time I found myself wandering the nearly deserted attached Tysons Galleria when I got stuck in the Ritz Carlton in Tysons Corner, VA in an ice storm for two days. I had such a good time shopping that American Express called to see if my card had been stolen because of all the “different to me” purchases.
This story is about a different time spent in a mall. I was traveling in the Palm Beach Gardens area of Florida and I was looking to kill some time while waiting on a friend so I stopped into what turned out to be a very upscale mall. My plan was to people watch.
That’s where I met her – The Best Customer She Never Knew.
I was looking at watches in what would be best described as an independent, upscale, jewelry store. I actually don’t wear watches these days and I have a bunch already so I’m not a good prospect. But, I enjoy looking at them and this store had quite a few expensive ones. A well-dressed woman who might even have been the owner approached me and asked what most salespeople ask, “Can I help you?” I responded the way most customers do by saying, “No thank you. I’m just looking.” I expected her to say something else to leave the door open to come back to me but she just wheeled on her high heels and went back to whatever she was doing before I came into the store. I think it was polishing something.
A few minutes later a woman came in and also approached the watch display case. She seemed to know what she was looking for so I moved aside to let her get a better look. At the same time we made eye contact and exchanged hellos. The salesperson who had to have seen her come in since she walked right by her to get to the watches continued polishing or whatever it was that was keeping her occupied. After a few minutes, the woman looked around and smiled at me again and said, “I guess nobody wants to make a sale today.” I laughed and said, “Yeah, I guess the jewelry business is just too good these days.”
Finally the woman walked back toward the salesperson and said, “Excuse me. Could I get some help here?”
The sales rep let out an audible sigh and slowly made her way toward the watch display case.
“I’d like to see that Breitling right there,” she said pointing to a beautiful man’s timepiece.
I don’t know much about high-end watches but I know Breitling is one of them and I know they are expensive – like thousands of dollars expensive. I also knew that my people watching was about to get more interesting.
You see the woman was dressed in faded jeans and a blouse and she had a look of being a bit disheveled. She was carrying a handbag that was made of distressed leather. But, it appeared to me that her most pertinent feature (from the disdain the salesperson showed) was her skin color. It wasn’t white. And, that fact plus her way of dressing had already made up the sales rep’s mind that the customer was, at the very best, wasting her time.
She sighed again as she got the watch out of the case and held it tight in her fingers as she showed it to her. I was pretty sure the woman would want to hold it if she was going to spend that kind of money on what must be a gift. I was also pretty sure the salesperson wasn’t too keen on letting her touch it. She reached for it and finally the rep let her hold it. “It’s a beautiful watch,” she said admiringly.
She looked it over and even put it on her wrist. Since it was a man’s watch it was much too big for her but you could see she was imagining it on someone else’s wrist. She had a large smile on her face and I knew she liked it. I waited to hear the big question.
“How much is it?” she asked as she took it off her wrist. The rep took the watch and put it back into the display case and locked the door. She then looked up at her and with condescension dripping from her lips and another sigh, she said, “$7,250.” She then put her hands on her hips and stared at the woman with a look that said, “Will you now please leave.”
As her eyes narrowed, the customer started to open her mouth to say something. Instead she started laughing. At first it was more of a chortle and then it turned into a melodious giggle as she walked out the door shaking her head. I think the sales rep thought she was laughing at the price. I was positive she was really laughing at the clerk when what she really wanted to do was give her a piece of her mind.
I didn’t realize it but I started chuckling myself. The salesperson gave me a look as if to say, “Why don’t you join her and get out of my store.” And, so I left thinking about how poorly the clerk treated the lady. I didn’t know if she was a real prospect or not but I did know that the salesperson never bothered to find out and that she had judged her as not worthy of her time as soon as she saw her.
But, that’s not how this story ends.
I walked a few stores down the mall and decided to stop in and have a coffee at a cafe. As luck would have it, our would-be customer was sitting at a table having her own cup. I got my coffee and sat at a table that faced her. I could see she recognized me so I smiled and said, “I enjoyed how you dealt with that rude clerk back there. You had me laughing with you.”
She put her cup down and said, “Well, I really wanted to tell her to bite me. But, I was afraid she might.” And, with that we both started laughing all over again.
Wiping the tears of laughter from her eyes my new friend said, “The watch is for my husband. It’s his birthday on Saturday and he loves watches. There is another store not too far away where I can buy it. I’m getting it to go with his car.”
“Go with his car,” I thought. “What does she mean?”
She saw the look of puzzlement in my eyes and explained, “He drives a Bentley. The watch is a Breitling Bentley.”
And, with that revelation, I started laughing all over again!
Do you love your clients? You should. We do here because we know that they could have gone to thousands of other consulting firms and sales and marketing coaches. I get all excited when a client chooses us because I know they found something out before they invested in our services that made them love us too. And, so we do our absolute best to deliver really great results and value to them.
If you’re in any kind of service – especially creative services – then you know that a client relationship has many of the same elements as a marriage. You may not always agree on everything and there will be times when you want to stomp out of the room and sulk but ultimately you come together as a team for your mutual benefit. And, when you do work as a team and also share respect and caring about each other then most often magic happens in the creative fields. That’s when you shift into feeling and creating and forget about contracts and fees and all the stuff that all business owners face.
Often I talk to sole-practitioners or freelancers who find themselves always worried about being successful. They worry constantly about the business side of their business because they have identified that’s their weakness. This worrying and fear ends up taking away from the creative side which then affects the business side and round and round we go – usually in a downward spiral.
The truth is that not everyone who lives a life of creativity can be a successful business person too.
But, you can partner or team up with someone who has the business skills. You can find someone who already understands the business side and make them your partner. You can hire someone who specializes in what you need and make them a permanent part of your team. They’ll make you money because you can now focus on the creative side.
The same thing goes for client development which is a euphemism for selling. You have to sell yourself, your company and your services. And, you have to put yourself in front of enough people who are interested in purchasing services like you offer so you can tell your story. That means spending a lot of time marketing, prospecting, and selling. Once again, not everyone can do that. You may be the best animator or designer or copywriter in the country. But, if you can’t market, prospect and sell it won’t matter unless you plan on working for the man all your life and even then you’ll be expected to do a fair share of all three of these jobs.
The solution is the same as above. Why be a lone wolf when you can be the leader of a pack? Almost all the creatives I meet that tell me their story of going it alone and struggling or failing are not the types of people who would prefer to live in a cave by themselves. Most of us humans have a deep need to belong to a community, team, or tribe.
Why be a lone wolf when you can be a leader of a pack? Build a team. Build a family.
We all think we have it. We buy the cars we drive, the food we eat, the computer we surf with and the hairstylist we use by exercising our free will. We choose who to marry, how to raise our kids, and where we invest our money using our free will. We spend our work and leisure time doing things we have freely chosen to do by exercising our free will. Right?
Or Do We? Well, sure, you may be thinking that your choices are influenced by things like environment, education, financial wherewithal, and a myriad of other things and other people. But, the fact is that we almost always have been sold by someone else in what we buy, who we date, why we do most things in life.
So if sales has such an impact in our lives why do so few people know how to do it well? How might your life be different if you really knew how to apply some simple principles – not techniques or tactics – but simple actions you can use that are not manipulative and will allow you to be more successful in your personal and business life?
Here are some questions to ask yourself:
Do you cringe inside at the thought of having to sell?
Do you cringe at the thought of dealing with a salesperson?
Would you pick up a book about learning to sell if you knew it wouldn’t violate your personal principles and it would actually make you feel good about the process?
Would you invest in sales education if you knew if could make your life and business?
As someone who has written, taught and breathed selling for over 40 years, I’ve seen plenty of lives changed for the better when you learn some sales principles . Sales professionals, business owners, moms and dads, students – you name them – have benefited by learning how to sell their ideas, dreams, projects, services and products to name just a few things.
BUT – (you knew there was a BUT coming) – but as a good friend of mine said the other day, “If people don’t know they need to learn how to sell better, how will they know they need to invest in a book or education?”
You see the odds are very high that since you are reading this blog that you already know how to sell or want to learn how to sell better. You’re already aware of all the benefits it brings to both your personal and business life. But, what about the people who answered yes to questions 1 and 2 above? They either don’t know they need to learn to sell better or fear of something is holding them back.
Over $65 billion will be spent this year on weight-loss programs, diet drinks and food, surgery, books, etc. all with the hope of looking and feeling better.
I think my next book will be entitled “How to Get Thin and Happy Through Selling.” What do you think?
I have a secret to tell you about people. They don’t always tell the truth. And, some of them will wish you the best of success while thinking of ways to overtly or covertly mess up your plans.
When you’re getting ready to start a new business or launch a new product you’ll get all excited and probably even a little scared. You’ll want to tell people all about it before it’s time and that will sometimes backfire on you. Or, people will wish you the best of success while actively working to sabotage you.
For example, when I started my first photography studio in the early 70’s in my hometown, I chose to purchase all my equipment and supplies from a local camera store instead of from one of the big professional dealers. I paid at least a 20% premium on most of the equipment but I wanted to support the community and buy locally.
About nine months later as I was moving the studio to larger and better space and I needed more equipment. I happened to be talking to another local businessperson and told them my plans. They asked if I still bought from the local store and I said, “Yes, of course.” Then he told me that I should know that the manager of the store (not the owner) was always “bad mouthing my work.” I was shocked as I was still very young and very idealistic. I thought “Why would someone do that when I am giving them more business than any other place in town?”
It doesn’t matter why he did it. The not-so-secret-secret is that people will betray your trust and support. Your banker with whom you shared information about a commercial property you are going to buy will tell someone he knows who has been looking at it and that someone will buy it out from under you. It will happen to you too.
You’ll share your idea for a new venture with someone you think of as a friend and they will tell someone who will tell someone who also thinks it is a good idea. It will often be inadvertent. People like to tell secrets. It makes them powerful or it gets them needed attention. It will happen to you too.
A motto during WW II was “Loose Lips Might Sink Ships.” It’s not a bad one to consider before you launch your ship. You wouldn’t want to see it never set sail or sink at sea. And as far as dealing with the type of person like my camera store manager take my advice and when you can verify that someone is working against your success – write them off. They’ll never ask you why you quit doing business with them. They’ll already know. It happens to them all the time.