During my recent travels around the country, many dealers have expressed extreme concern about the state of the building industry. You can hardly turn on the television or open a newspaper without hearing the bad news. The fact is clear: Housing starts are down. What should you do? Well, you can debate the causes of the slowdown and concern yourself with an economic outlook over which you have no control. Or you can strategically maximize your sales opportunities under adverse circumstances. For certain, the slowdown offers a critical lesson: You should have been vigilantly prospecting for new business all along.
You can't change the news, but you can control your response to it. I'd like to conclude this year's Sell Sheet series by offering you a new vision that will help you deal with the current slowdown and provide a foundation for success that will endure in both good times and bad. I believe the best sales response you can have in times of scarcity and abundance is to strive for a new position in the market, the position of Second Place.
Most salespeople, being competitive, regard second place as merely the first loser. But in our industry, being the “next choice of suppliers” is sometimes the best strategy. It makes a lot of sense to strike up relationships with as many people as you can and, rather than expect instant gratification for your sales efforts, take a longer-term approach.
A builder survey conducted by PROSALES a few years ago confirmed that loyalty is one of the strongest motivators in selecting a supplier. This is hardly information you need a survey to confirm; your own experience has probably demonstrated that trying to encourage a prospect who is satisfied with his current dealer to change suppliers only leads to frustration that includes combative price negotiations. The sales that are usually the most successful are those that come after a period of courtship and are consummated as mutually profitable relationships. In other words, loyalty and rapport in relationships begin before the first transaction is completed.
When a sale is made too rapidly, most salespeople agree that red flags should go up. The implication is that the builder may have poor credit or will not be particularly loyal to you if it was so anxious to make a change away from its last supplier. The simple truth is that builders and industry contractors, like all humans, are creatures of habit and generally do not switch suppliers until something goes wrong. Most customers are not anxious to switch suppliers because it means meeting new people, learning new procedures, and, most importantly, taking a risk! Therefore, you should remind yourself of what you already know: A prospect considering a new supplier will choose the one that is familiar and minimizes risk during a transition. The first supplier that comes to mind when it is time to make a change is the one that has been lurking in second place all along.
If you want to improve your sales performance over the long haul, stop trying to achieve instant gratification and realize that long-term success requires a systematic program of prospecting, cultivating relationships with potential customers before they become customers. To become the first supplier a builder will choose when they have a problem (which is when they choose a new supplier), the best strategy you can employ is to be the first choice of alternatives.