In business, nothing happens until a sale takes place. Sales are the engine room of any company. No matter how good your product or service is, no sales will result in your company going out of business or stagnating as your competitors win more and more business. In sales, many questions spring to mind. How can I make my product stand out from those of my competitors? What types of questions should I ask? How do I handle objections? How should I ask for the order? The list goes on and on. For the answers to these and other sales challenges, we’ve asked five internationally known authors of sales books and audio tapes to share their top 25 secrets forsakes success.
Brian Tracy: Key Sales Principles
Brian Tracy is president of Brian Tracy International in Solana Beach, California and is the author of several books, including Advanced Selling Strategies and The Great Little Book on Successful Selling. His key sales principles are as follows:
1. Sell benefits, not features.
The biggest mistake entrepreneurs make is in focusing on what their product or service is, rather than on it’s what the product does. As Tracy explains: “A health-food product contains nutrients that are good for the body.That’s what it is. What the product does is make the customer thinner, more energetic, and able to accomplish more with less sleep.” His advice: “Always concentrate on how your product will benefit your customer.”
2. Sell to the people most likely to buy.
Your best prospects have a keen interest in your product or service, and the financial resources to purchase it. They are the ones who will buy most quickly. “If you’re selling photocopy machines,don’t try to sell to people who have never bought one before,” Tracy suggests.“Sell to those who already have one, or to those you know would be interested in buying one. Show them how yours is superior.”
3. Differentiate your product.
Why should a customer buy from you and not from your competitor? Tracy suggests coming up with at least three features that will give a customer reason to buy from you. “People don’t like to go out of their comfort zone to try something new. So, give them three good reasons to try your product,” Tracy explains. “Your product or service, for example, works faster, is less expensive and has a higher-quality level of ingredients.”
4. Get face to face.
Spending huge sums of money on print-media advertising or direct mail is one of the least effective ways for entrepreneurs to build up their business. There is no short cut to the personal approach. Get one-on-one with your customer – if not in person, at least by phone.
5. Focus on the second sale.
Nearly 85 percent of all sales are produced by word of mouth. “They’re the result of someone telling a friend or associate to buy a product or service because the customer was satisfied,” says Tracy.Therefore, concentrate on developing future and referral business with each customer. “Everything you do must be aimed at the second sale. Ask yourself:will this be such a satisfactory experience that my customer will buy from me again or tell his friends?”
Shari Posey: Preparations & Guarantees
Shari Posey is president of Executive Insights, an audio-tape production company in Long Beach, California, and specialises in products for entrepreneurs. Here Posey illustrates how a sales presentation starts with careful preparation and ends with guaranteeing customer satisfaction:
1. Write out your sales presentation.
Making a sales presentation “isn’t something you do on the fly,” warns Posey. Always use a written presentation.Think about the six major selling points of your product or service. Develop leading questions to probe your customer’s reactions and needs to each selling point. “This will help you determine what objections your prospect might have so you can show how your product or service can meet their needs.”
2. Write down objections.
Show your prospect you are truly listening to what they are saying by writing down their objections. In this way, you can specifically answer their objections by showing how they will benefit from your product or service. It could be, for instance, by saving money, raising productivity, increasing employee motivation or boosting their company’s name recognition.
3. Offer a first-time incentive.
Offer your prospect something significant,so if they do like your product or service, they’ll be inclined to make a decision now, rather than wait a few days or put off the decision indefinitely.First-time incentives might include: “10 percent off with your purchase today”,or “With today’s purchase, you’ll receive one free hour of consultation.”
4. Offer a 100% guarantee.
Let your customers know their satisfaction is guaranteed. “A good return policy minimises customer objections and shows that you believe in your product or service,” says Posey. Product guarantees should be unconditional and should not include hidden clauses, like “guaranteed for only 30 days”. You can use a guarantee even if you’re selling a service:“Satisfaction guaranteed. You’ll be thrilled with our service or we’ll redo it at our expense.”
5. Close with two options.
Rather than ask, “How does this sound?”,give your prospect a choice. For example, if you’re selling educational book sto preschool owners, ask if they want to purchase the book series or the book and tape series together. When they state their choice, write the order. “Your prospect is not likely to stop you,” Posey explains, “because mentally they realise they’ve committed and they’ve said ‘yes’.“
Linda Richardson: Sales Presentation Success
Linda Richardson is president of The Richardson Company, a leadership and sales-training company in Philadelphia and is author of Stop Telling, Start Selling: Using Customer Focus Dialogue to Close Sales. She offers the following secrets for success when making your sales presentation:
1. Build rapport.
Before discussing business, build rapport with your prospect. To build rapport, do some homework. Find out if you have a colleague in common. Has the prospect’s company been in the news lately? Is he interested in sports? “Get a little insight into the company and the individual so you can make the rapport genuine,” says Richardson.
2. Ask a broad range of questions.
Ask questions that require more than a“yes” or “no” response, and that deal with more than just costs, price,procedures and the technical aspects of the prospect’s business. Most importantly, says Richardson,“ask questions that will reveal the prospect’s motivation to purchase, his problems, needs and decision-making processes.” In addition, she advises:“Don’t be afraid to ask a client why he or she feels a certain way. That’s how you will get to understand your customer’s needs.”
3. Probe deeper.
If a prospect tells you, “We’re looking for cost savings and efficiency”, will you immediately tell him how your product meets his need for cost savings and efficiency? A really smart salesperson won’t, says Richardson. He or she will ask more questions and probe deeper,saying: “I understand why that is important. Can you give me a specific example?” Richardson suggests that you “ask for more information so you can better position your product and show you understand the client’s needs”.
4. Learn to listen.
Salespeople who do all the talking during a presentation not only bore the prospect, but also generally lose the sale. You should be listening at least 50 percent of the time, notes Richardson. You can improve your listening skills by taking notes, observing your prospect’s body language, not jumping to conclusions and concentrating on what your prospect is saying.
Write thank-you notes, call the customer after the sale to make sure he or she is satisfied, and maintain a schedule of future communications. “You have to be in front of that client and always show attention and responsiveness, and follow-up is critical,” says Richardson.
Bob Bly: Sales Materials That Shine
Bob Bly is an independent copywriter and consultant in Dumont, New Jersey and specialises in business-to-business and direct-response marketing. He is the author of more than 50 books, including The Copywriter’s Handbook. He tells us how to really impress your prospect and give him sales materials that will make him want to order now.
1. Target your material towards a specific audience.
These days, it’s not possible to understand and meet the needs of every potential customer. Show you are a specialist, Bly urges. “You have a selling advantage and come across as believable when your sales materials are tightly targeted to specific audiences,” he explains. “Say you offer ‘accounting services for advertising agencies’, not just ‘accounting services’.“
2. Use testimonials.
People might not believe your product or service can do what you say it will. You can overcome this disbelief by having a past or present customer praise you and your company. Testimonials are usually written in the customer’s own words, are surrounded by quotation marks and are attributed to the individual. They can be used in sales letters,brochures and advertisements.
3. Write from the customer’s point of view.
“Start your copy with something that engages the prospect,” Bly suggests, “and what most people are interested in is themselves.” If an insurance agency wanted to introduce its new employee health-benefit programme for small business owners, it might wish to state the obvious,using the phrase, “Introducing our Guarda-Health Employee Benefit Plan”. The agency would get better results if it wrote something that directly interests the prospect, like: “Are the skyrocketing costs of your insurance premiums threatening to put your company out of business?” As Bly explains, “That’s something business owners who provide benefits to their employees can relate to.”
4. Use questions.
A great way to engage your prospect is to pose questions in the headlines of your sales literature. “Every car-wash owner should know these seven business success secrets. Do you?” Or, “Why haven’t satellite-dish owners been told these facts?”
5. Turn a negative into a positive.
If you are new in business and haven’t sold many products or signed up many clients for your services, don’t despair. You can phrase your situation this way: “Not one widget buyer in a thousand has ever experienced the advantages of this new XYZ widget design.”
Barry Farber: Get to Know Your Customer
Barry Farber is a sales, management and motivational speaker, and the author of several books, including 12 Clichés of Selling and Why They Work. Here are five of his top sales secrets for getting to know your customer and asking for his feedback:
1. Know your customer’s business.
Customers expect you to know their business, customers and competition as well as you know your own product or service. Study your customer’s industry. Know its problems and trends. Find out who his biggest competitors are. Some research tools include the company’s annual report, trade publications, chamber of commerce directories, and the company’s own brochures, newsletters and catalogues.
2. Organise your sales presentation.
The basic structure of any sales presentation includes six key points: build rapport with your prospect,introduce the business topic, ask questions to better understand your prospect needs, summarise your key selling points, and close the sale.“Always begin the process by first visualising a successful outcome,” Farber says.
3. Take notes.
Don’t rely only on your memory to remind you about what’s important to your prospect. Ask them upfront if it’s alright for you to take notes during your sales presentation. Write down key points you can refer to later during your presentation.
4. Answer objections with “feel, felt, found”.
Don’t argue when a prospect says, “I’m not interested”, “I just bought one”, or “I don’t have time right now.” Simply say:“I understand how you feel. A lot of my present customers felt the same way.But when they found out how much time they saved by using our product, they were amazed.” Then ask for an appointment.
5. Ask for feedback.
If you want to improve your sales presentation or your relations with your customers, ask them what you need to do to maintain and increase their business. “Many customers have minor complaints but will never say anything. They just won’t buy from you again,” Farber says. “If you ask their opinion, they’ll be glad to tell you and to give you the chance to solve the problem.”
When Do You Know It’s Time To Sell Your Business
Five telling signs.
Even though running your own business gives you many freedoms, everyone still has those days or even weeks of wondering, “Shall I stay or shall I go?” Sometimes this thought becomes persistent instead of a passing phase – and for your own financial future and that of your business, you need to be able to recognise signals that mean the right moment has come to consider selling your business.
This is never an easy decision, especially as the amount of stress and constant pressure that a business owner contends with will play havoc with the decision-making process.
Having engaged with hundreds of business owners over the years, we see the five most solid signals that prompt them to sell are:
This is the single most common factor influencing the decision to sell a business. Whatever age you have chosen as your retirement goal, if you are approaching this then give yourself an opportunity to assess both the benefits and challenges of having your own business.
Have you considered an exit strategy, such as hiring someone else to run the business instead of you? Or, as in many cases, does your business represents your most valuable asset? In this case, it would need to be cashed out at some stage as this would represent your pension. Selling your business successfully and fetching maximum value could well be critical to ensure that your retirement is well supported by financial surplus.
2. Lifestyle Change
Growing a business can be an infinite journey. Have you reached your goals with this business and do you have the appetite for the ‘next chapter’? Or do you want to move off into a completely new business direction? Perhaps you would prefer to follow a passion of yours or spend extra time with your family, investing more time in yourself and them to counter the massive investment of time and energy that you have made over the years.
3. You are ‘gatvol’
We often underestimate what it takes to live life as an entrepreneur and the amount of compounded pressure we ‘on-board’ over the years. Whether it is customers, suppliers, staff or the banks, you know this stress has reached a decisive, even destructive level if you can’t shrug it off and instead you find yourself repeatedly saying, ‘Enough is enough!’
4. Building a business versus running a business
Go back to the beginning of when you started your business. Do you remember the passion, fire and motivation that drove you to achieving your first sale? How about that sense of achievement as you hit the subsequent milestones? All that represented the very DNA that you have as an entrepreneur – but as your business grew, so did everyone and everything you need manage on a daily basis. Do you find yourself being more of a human resources manager than that entrepreneur with that fire in your belly? Is running a business enough to motivate you and drive your core DNA?
Perhaps this is the signal for you to sell the larger business that you have developed to someone with the skills and interest in the administration it requires. Selling your business would free you up to apply your entrepreneurial skills in a new context.
5. You can’t do it on your own
In many cases you may still have time and energy to keep growing your business – but you may recognise that you are not willing and able to do this yourself. Sometimes you would appreciate a ‘big brother’ who can share the load. This could equate to a partner injecting money into your business, taking on some of your risk or opening up new opportunities for you and your business. This has become more and more prevalent in South Africa with the BEE codes and pressure on certain industries. Bringing on the right strategic partner to help you navigate uncharted waters is a critical step to take in your eventual exit strategy.
Decoding the signals that suggest it might be time to sell all or part of your business means that you will make the right decisions to stay or go based on sound reasoning. Remember that this is one of the few times in your life that you truly get ‘one shot’ to get it right.
Selling Your Business? How To Exit In Style
Gary Palmer, CEO of Paragon Lending Solutions runs through some practical requirements to realise the best value possible when selling all, or part of your business.
Preparing to sell a business you have put years of work into, or even built from scratch, can a be a daunting prospect. Aligning the disconnect between what you think it’s worth versus what a buyer is prepared to pay is just one of the challenges.
Act like you’re on the market – all the time
Like the Scout’s motto says: Be Prepared. A business owner needs to make sure their business is sale-ready at all times. Not only will this save a heap of administration when you do want to sell, but also means that, should an excellent offer land on your desk, your business financials and compliance issues are well in hand.
A business must be able to show a clean set of audited financials as well as up-to-date management accounts. Your accountant will be able to help get these in order if they aren’t already.
Make sure you aren’t running personal expenses through your business. This can be a challenge for some small businesses. Despite the allure of minimising taxes by running private expenses through the company books, it poses significant risk when preparing clean financials.
Prepare a due diligence pack. This can be provided by your auditor or financier and will include a list of your current contracts, VAT and SARS clearance certificates and defendable cashflow projections. Having all the documents required for a due diligence in one place that is easily accessible will go a long way to cutting down on the time it will take your prospective buyer to assess the company’s value and future potential.
It’s also important to remember that assembling all the necessary documentation takes time. It’s better to begin the process well ahead of when it will be needed. It’s also quite possible that a potential buyer may put a premium on the buying price if they know they are walking into a business which is clean, up to date and has no unexpected auditing or compliance skeletons in the closet.
Consider all the angles
Business owners opt to sell their business, or part of their business, for any number of reasons. This could be in order to retire and live off the proceeds, or because they want to raise money for another business opportunity. It’s important for owners to remember that there are associated expenses and even delays that they should plan for.
Before any negotiation begins, a business owner will need to find the right buyer. There are a number of brokers and financial service companies who can help source qualified potential buyers and, unless you have an offer on the table, it is a good idea to work with a third party to get line up a few credible potential buyers.
Once the deal has been negotiated and you have settled on the price, you must factor in Capital Gains tax. It is sensible to have a good idea of this before negotiations begin and to work out your asking price accordingly. Other expenses may also impact what you walk away with, including professional fees for your lawyer, auditor and other consultants with whom you have worked during the sale. You should also plan for delays due to valuation debates and requests for supporting documentation which may take time.
Finally, it is always a good idea to consider whether you want to walk away immediately after the sale. Many business owners choose to stay on in operations, and by doing so can negotiate a more favourable price with earn-outs attached to the sale price. After all, you are the person who knows the business best and has a relationship with your clients – and this insight comes with a value attached.
Most importantly, if you are planning to sell your business, it’s a good idea to have advisors and partners who have been through the process many times and are able to help you navigate what may be unchartered waters for the first-time seller.
When Is The Right Time To Sell Your Business?
Of the 6 most common questions I get asked on a regular basis, when is the right time to sell is by far the most common. The mergers and acquisitions game is part art, part science and a whole lot of elbow grease.
Your personal context
- How old are you?
- How much energy do you have left in your tank?
- Have you extracted value out of the business already?
- Have you managed to de-risk yourself by investing in equivalent assets outside of your business?
Only you can answer these questions, but they will go a long way in providing clarity for you and your ability to take the first step to selling your business?
Is your business ready to sell?
If I had R100 for every time someone had said to me that they want to wait another twelve months before they sell, I would have accumulated a substantial amount of money. Despite what the majority of advisors say, there is very often no real need to ‘dress up’ your business for sale.
Don’t get me wrong. You need a going concern that delivers solid returns to catch the eye of the right acquirer. However, who are you dressing your business up for?
If you do this properly, you will have more than one buyer at the table. Chances are, what is attractive to one buyer won’t necessarily be attractive to someone else. It is impossible to be all things to all acquirers.
You say you are just 12 months away….
12 Months is a magical number. Business owners always seem to be 12 months away from being ready to sell their business. Maybe it’s that big contract you are hoping to land. Perhaps you want to put in a new IT system. There will always be something.
Speaking from experience, I had a client that was going to wait, but instead committed to the process. Had they waited 12 months they would have been hit with ‘Nene-gate’, Brexit and Trump all in a 12-month period! There is no way that anyone could have anticipated a trifecta like that. I had another client that put in a new SAP system in those 12 months and the acquirer used Oracle!
You will reach the 12 month point anyway…
With the time that it takes to complete a successful transaction there is a good chance that you will cross that threshold of that big contract that you were hoping to land, putting that succession plan in or whatever the reason was that you wanted to delay the process for.
Something else that generally ruffles a few feathers, is that selling the (proven) potential generally fetches a far greater value than the past. This in itself is a whole other topic, but in the context of when is the right time to go to market, always keep this factor front of mind.
What is happening in the economy and your industry?
We are fortunate to have seen an increased sentiment in, and around, the South African economy in 2018. There is an uptick in international interest, but you know what the reality is, it never really took a major dive. The reason being that irrespective of the economy or your industry, good businesses sell. Some of my best deals happened in 2016 when the economy was under severe pressure.
Remember that when times are tough, acquirers need to buy good businesses to grow, as their own profit and be under pressure. When the economy and your industry is doing well, acquires will buy as they have excess cash to invest and will have a more bullish outlook on taking risk in their investments.
Truth is….there is no perfect time
The one thing that I have learnt over the past few years is that one can theorise for months trying to think of endless ways to increase the value of your business. Without climbing into the market and actually determining what your reality is, you will keep delaying your decision to take your business to market.
There is only one real hurdle that needs to be overcome, and that is you. If it is any consolation you will never be 100% ready. What have you got to lose? If you go to market and, worst case scenario, you don’t sell, you still have a great business to run and grow.
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