Five Major Sales Leaks That Could Be Affecting Your Company
My wife Anne gets after me because I’m not always careful enough with my spare change and bills, and they often fall out of my pocket. This often occurs in her car, and many a shopping excursion has been thus funded. She says I “leak money” (and does her best to restrict my access to the same).
Some of our customers leak sales rather than money, and this was brought home to me when I recently had a conversation with a good customer who had started using our Quosal Order Porter Mobile for the iPad application. He said he was doing three times as many quotes as he previously had been. Naturally, I think that’s great – but I realized, as he did, that he’d been missing out on two thirds of his sales opportunities before – he was leaking sales by writing them down on yellow sticky notes, or business cards, or just trying to commit to memory a customer’s request for a new product, or his own on-site observations of a customer’s needs. Now, he takes out his iPad and delivers the quote on-the-spot.
There are many ways to leak sales, and all of us do, sometimes on a daily basis. It’s a very costly habit. Here are a few ways that I see sales dribbling away for businesses of all types, but particularly our information technology audience.
Five Major Leaks:
- Failing to provide a quote when directly asked by a client
- Failure to let the customer say “no” to a more expensive option
- Failure to ask for leads from your best source – your customers
- Standardized product margins, and failure to review them
- Failure to debrief your engineers when they return from a client site, and act on the information
This happens all the time, and it’s of course one of the highest priority leaks to plug – because it not only costs you a sale but also could ultimately cost you a customer that’s asking not only to buy something from you, but for the service of your expertise as a trusted advisor translated to a sales proposal. This is a bad habit that many of us have. Break that habit – fast. This is a leak that can sink the ship.
Many sales professionals do their customers the disservice of underselling and saying “no” for the customer. Your customer is a smart person – let THEM decide whether they’d like the Toyota, Cadillac, or Rolls Royce. A lot of people prefer quality over savings, and bells and whistles are called that for a reason. Are you quoting accessories, extended warranties, and especially additional services? Take the extra few minutes to do so. You’ll be surprised how often your customer will say “yes”.
Your good customers are as interested in your success as anyone, and if you ask them if they know others that might need your services, they’ll tell you if they know anyone. Referrals are the best source of new sales for many businesses. A proactive approach can yield great results. Ask your customers for a lead.
We have a feature in Quosal that allows our customers to set a standardized margin or markup percentage. I’ve often thought of removing the feature or at least putting a disclaimer on it which says something along the lines of “Failure to make as much money as you can is not the responsibility of Quosal LLC, its employees, assigns, or heirs.” The reason for this is that many businesses will set such a standard margin much lower than it has to be, and their sales staff will simply default to that margin. During one training session with a new client, I showed them the feature, and they promptly set a standard gross margin of 8 points on server hardware. Feeling guilty, I asked them to try an experiment – set the gross margin to 12.5 points instead. They balked, hemmed, hawed, and shuffled – but grudgingly accepted my suggestion. I checked back after a few weeks and guess what – their salespeople had quoted the new margins as acceptingly as the original. Sales and margins were up. Let your business be as profitable as it can be, not what you limit it to be.
Guess who knows the most about what your customers need, want, or could use? Is it possibly the people that spend the most time at a customer’s office, or on the phone with them? It most certainly could be. Here’s a broken paradigm that makes your sales leak like crazy: Engineer goes on site, learns of something the customer needs. Comes back to the office, tells the sales rep. A couple of weeks later, sales rep MAYBE gets a quote out – for the wrong thing, since it’s been two weeks. Does this sound familiar? Your engineers should be shaken down and despoiled of every sticky note and business card they’ve made random notes on, until you’re satisfied you know of every opportunity they discovered while with the customer. Then, your sales team should ACT on this information – with a prompt, professional, reliable quote that specifically cites comments from the engineer about those needs – the engineer is, after all, often the most trusted person from your company to the customer. (If you’re not an IT company, substitute the trusted service advisor that calls on your customer).
I’m going to add one bonus leak: The failure to really focus on the desires of our existing customers to do more business with us. We often are much more worried about signing new customers – but the simple reality is that our own existing customers are a tremendous source of business as well.
Are you looking to grow your business, increase top-line revenue, profit margins and profits? Plug those Sales Leaks!
Find out some great ways to stop those leaks and build your sales at Quosal’s Quotation Nation event.
The Hilton Bonnett Creek Orlando, Wednesday, November 9th, 8:00am-5:00pm. Register Now!
Kent McNall
President and CEO
Quosal LLC
