Salespeople I meet are starting to remind me of alchemists from the middle ages.
Alchemy was the purported ability to turn base metals into precious gold. Today, many people fancy themselves sales alchemists who can turn combative, unprofitable prospects into loyal, high-margin customers. The only problem is that it doesn’t work.
A combative negotiator, disloyal to suppliers, will not change overnight because your “better service” saves them money. A disorganized builder who requires constant deliveries due to scheduling mistakes will not suddenly become organized the day you open the relationship. The key to sales success is locating the right prospects, the ones who promise to provide profitable, long term relationships.
Proactively prospect for gold nuggets rather than attempt to magically turn invaluable rocks into precious gems. Create a list of the characteristics you seek in an ideal customer. Then find customers that either fulfill those traits or at least demonstrate openness, before the first transaction, to follow your leadership guidance. Here are some of the ones I advocate:
Fair Margins: It is a fallacy to believe you can “buy” a prospect’s business with a low price and later raise margins after the relationship begins. History has repeatedly proven that salespeople lose those customers exactly in the same way the earned them…to a competitor who also believes he can “buy” the business with a lower price.
Loyalty: Your ideal customer is loyal, which means you should respect the loyalty he offers your competitors. It also means that it is advantageous to build relationships with builders when they are in the early stages of business. Prospecting requires the patience to wait for the moment that a potentially loyal customer is dissatisfied with its existing supplier.
Long-Term Potential: As you read this, somewhere a salesperson is asking a prospect, “Got anything coming up I can bid on?” This reflects a transactional mindset that will not foster a successful long-term relationship. Your goal is not the next project, but sell the contractor every project for the rest of his business existence. Focus on long-term relationship building instead of “bidding” to get the next project. The extra work and patience pays off in the long run.
Low Nuisance Factor: The “nuisance factor” is what I call the return-on-time invested in doing business. It’s worth an extra delivery and a lot of preparation time for a valuable client that gives you tremendous return-on-time. It’s not worth the hassles a high-maintenance customer gives when service and delivery costs eat into profits. The problem is the disconnect between compensation and customer value. A true sales leader sells profits before volume. Select clients whose maintenance costs do not destroy profits.
Ben Franklin once said, “Keep your eyes wide open before marriage, half shut afterwards.” It’s way too late to set the parameters of your business relationship after it begins. You must strive to clarify expectations before the first transaction. This means being clear about the types of clients with whom you want to do business and proactively seeking out those opportunities.
Prospecting is literally the process of sifting through worthless pieces of rock to discover nuggets of valuable gold. A good prospect is a nugget of gold that promises to do business with some degree of cooperation. Many salespeople argue these types of clients are not out there, but they are. You should at least look to find them. One thing is certain. If you don’t know what you’re looking for, you’ll surely find it.