The starting point of any proposal is research. Find out as much as you can about the prospect’s business, business model, competitors, organisational structure, and buying behaviour. This way you will understand what the customer’s real concerns are and know how to address the value system of decision-makers.
In many companies, the decision-makers wear different hats. This mix of decision-makers requires a proposal that appeals to different sets of disciplines. For a decision maker to read the proposal you need to have visibility in the marketplace.
This is established through meetings, emails and phone calls. Bigger companies create visibility through advertising, sponsorships, websites and newsletters.
Telling the right story
Start by getting your team together and brainstorm. Generate as many ideas as you can, discuss them, and then prioritise the best ones. Merge these ideas into themes and then write the story of the business. Stick to these rules:
- Keep it simple – focus on the most important issue you want the prospect to remember.
- Have a story line – create the proposal around the prospect’s situation
- It must be memorable – draw a vivid picture of the fantastic outcome you can offer the prospect.
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The executive summary is a sales tool
The word “summary” makes us think that an executive summary must summarise the proposal, but a proposal is much more of a tool if it summarises the reasons why the customer should buy from you. The focus must be on the prospect. The name of the prospect should appear as frequently as the name of the vendor.
According to Tom Sant, America’s foremost proposal writer, a proposal should be divided into four parts.
- Part 1: Explains that the proposal writer understands the prospects business.
- Part 2: Describes the potential impact on the customer’s organisation if the problem is solved, if the need is fulfilled, or the goal is achieved.
- Part 3: This section must be written in non-technical language. Each element of the solution should tie into the customer’s problems or needs.
- Part 4: Again write this section as simply as possible. In this section ask for the business, which can be done by just saying, “We are very exciting about working with you”. Include one or two key points that differentiate you and that prove that you are the right company for the client to choose.
Target your audience in the body of the proposal
The body of the proposal is about your business. Make sure that the information flows logically. Explain solutions you offer, your experience, and your capabilities. They need to see details of how you work and what you provide. Include proof of your financial stability and competency.
Every industry has its own particular “language” such as words, terms and expressions. However, these terms are foreign to people from other industries. Avoid the use of jargon, or if you must use it, explain it. Define what makes you different from your competition and how you can reduce the prospects overall costs.
Be fastidious about checking your proposal
Your proposal will be competing with proposals prepared by professional writers and designers. You may not have those resources at your disposal, but you can be fastidious about checking for typing, spelling and grammatical errors. Ask someone else to check your document for errors before you submit it, it takes a fresh eye to spot the typos.
Many proposals have been thrown out because the proposal-writer left the name of one of the prospect’s competitors in a paragraph copied from an old proposal. Avoid any language that is considered offensive – including women, men, persons with disabilities, persons belonging to visible minorities, senior citizens, and so on.
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Personally present your proposal
Research has proved that proposals that are presented personally have a 50% higher chance of winning over those who do not present personally. Face-to-face time with the prospect is the best way to secure a deal.
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.
6 Little Things That Make A Big Difference To The Value Of Your Company
Here is a list of six little details to get right before you put your business on the market.
With the Olympic Games just having taken place last month, it is interesting to reflect back on some of the big events of the 2016 Olympic Games in Rio.
In the Men’s 100m final, for example, the winning time of 9.81s was posted by Usain Bolt. The time among medalists was one of the closest in Olympic history, and while Johan Blake of Jamaica posted a respectable time of 9.93 – he finished out of the medals in fourth place.
In the 100m dash, vital milliseconds can be lost in the tiniest of miscalculations. And when it comes to selling your business, markets can be equally cruel. Get everything right, and you can successfully sell your business for a premium. Misjudge a couple of minor details and a buyer can walk, leaving you with nothing.
Related: Here’s How To Value Your Business
1. Find your lease
If you rent space, you may be required to notify your landlord if you intend to sell your company. Read through the fine print and ensure you’re not scrambling at the last minute to seek permission from your landlord to sell.
2. Professionalise your books
Consider having audited financial statements prepared to give a buyer confidence in your bookkeeping.
3. Stop using your company as an ATM
Many business owners run trips and other perks through their business, but if you’re planning to sell, these treats will artificially depress your earnings, which will reduce the value of your company in the eyes of a buyer by much more than the value of the perks.
4. Protect your gross margin
Oftentimes, when leading up to being listed for sale, companies grow by chasing low-margin business. You tell yourself you need top-line growth, but when an acquirer sees your growth has come at the expense of your gross margin, she will question your pricing authority and assume your journey to the bottom of the commoditisation heap has begun.
5. Tighten your agreements
If you’re lucky enough to have formal contracts with your customers, make sure your customer contracts include a “survivor clause” stipulating that the obligations of the contract “survive” the change of ownership of your company.
That way, your customers can’t use the sale of your company to wiggle out of their commitments to your business.
Have a lawyer paper the language to ensure it has teeth in your jurisdiction.
6. Get your Value Builder Score
It will take 13 minutes to answer the Value Builder questionnaire. You’ll see how you performed on the eight key drivers of company value and you can identify any gaps you need to fill before taking your business to market.
Like competing in the Olympics, selling a business can be an all-or-nothing affair. Get it right and you will walk away a winner. Fumble your preparation, and you could end up out of the medals.
7 Tips for Cold-Calling Success
The cold call can be painful. Here are some tips for getting through it successfully.
The aspect of selling that strikes the greatest fear in people’s hearts is usually cold calls. A good way to make cold calls more appealing is to stop thinking of them as “cold” calls. Try thinking of them as “introductory” calls instead. All you’re trying to do is introduce yourself and your business to the prospect.
It’s important to understand the purpose of introductory calls so you have a realistic attitude about this type of business development activity.
Phone prospecting takes longer to pay off than other types of marketing efforts, so go into it knowing you’re exploring a new frontier and it’s going to take some time to get results.
As with any marketing method, you should never make introductory calls without a plan. First, always use a targeted list of prospects when making your calls.
If your product is household cleaning services, why call a random neighbourhood if you have no knowledge of income levels, number of household wage earners, or number of children? If you sell nutritional products to hospitals, why call nurses or doctors if a third-party pharmacy makes all the buying decisions? Get the right list of prospects.
You can obtain information about prospects from the list broker who provides you with the list; if you’re working from your house list, you should already have the information. If for some reason you don’t, try an introductory call like the following: “We provide mobile pet grooming for dogs and cats. Would that be a service your customers would want to know about, Dr. Veterinarian?”
Next, determine the best time frames for calling. If you’re selling financial services to upper-income CEOs or entrepreneurs, wouldn’t it be nice to know when their corporate fiscal years end?
Perhaps most of their investment purchases are made two to four weeks prior to that year-end close-out. That’s when they know how much extra income needs to be sheltered in a pension plan.
Sometimes timing is your ace in the hole. Granted, follow-up calls throughout the year may make that one important sale possible, but knowing when to instigate the first call is a priceless piece of information.
Third, plan by preparing a “sales script.” Write down what you’re going to say, what responses the prospect is likely to have, and how you’ll reply to them. No, you’re not going to follow this word for word, but if you’re nervous about making calls, it helps to have something in front of you. Chances are, after you get beyond the opening sentences, you’ll be able to “wing it” just fine.
If preparation for cold-calling is easy but actually making calls is painful for you, here are seven easy steps to get you on the phone fast:
1. Personalise each call by preparing mentally
Your mind-set needs to be aligned with your language, or the conversation won’t ring true. You need to work on developing a warm but not sugarcoated telephone voice that has that “Don’t I know you?” ring to it.
2. Perfect your phone style alone before making any calls
If you’re self-conscious about calling, you need to feel safe to act uninhibited. Try this: Gather a voice recorder, a mirror, a sales journal of incoming and outgoing phone scripts, a pen, and a legal-sized pad. Either write or select a favourite phone dialogue, then talk to yourself in the mirror. Do you look relaxed, or are your facial expressions rigid? Our exteriors reflect our inner selves. If you look like you’re in knots, your voice will sound strained as well.
Press the “record” button on your recorder, and pretend you’re talking to a new prospect. Play back the recording, and listen to your conversation. Ask yourself how you could improve your delivery.
If your voice seems unnatural and the dialogue contrived, don’t despair. As you practice and participate in real phone experiences, you’ll improve. Mastering the art of cold-calling is no different than improving your golf swing or skiing technique.
3. Create familiarity all around you
Use family photos, framed testimonial letters, motivational quotes, or whatever gets you in a positive, enthusiastic mood. If you like, play some music that inspires you.
4. Use your imagination
Pretend you’re a prospective customer calling a bookstore to see if they have a book in stock. If it helps, record how you sound to get the feel of your inquiring phone voice.
It’s always easier to imagine you’re a customer in need of information than a salesperson trying to force your way into the customer’s time.
The inquiry call is good practice because the tone of the conversation is “Can you help me?” or “I need some information.” Try to convey that same attitude when you use the phone to contact future customers.
5. Watch your tone of voice
You don’t want to sound sheepish and embarrassed, nor do you want to be arrogant. The ideal tone is warm, businesslike, curious, and straight to the point.
A good option is a question or a cut-to-the-chase statement such as “I’ve got a question. We’re offering a two-for-one special during the next 30 days on all our coffee drinks, just to get people into the store. I need to know if you’ve ever stopped in while shopping at the mall, and, if not, why not? We have got the greatest ice-blended mochas in town.”
6. Make your goal a fast “50 in 150” — that is, 50 calls in 150 minutes
Three minutes per call is all you need. With so many voice-mail systems intercepting calls today, this should be easy. Never give people the impression you have time to chat. Chatting isn’t prospecting. You’re on a mission. Get to the point, then move to the next prospect.
7. Take five after 15
After 15 calls, take a five-minute break — stretch, eat, sip a soda, turn on some tunes, and pat yourself on the back because you’re making it happen. Then grab the phone for 15 more calls.
This article was originally posted here on Entrepreneur.com.
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