Archive for November 22nd, 2009

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Trouble

November 22, 2009

On several recent occasions I have been asked to review letters that were being written concerning significant business problems. One business had repeatedly failed to meet a commitment to a major customer and the other was delinquent on payments to its vendors.

As I reviewed those letters I recalled some advice I had given to two boys a few years back. In the process of pulling a relatively harmless springtime prank, they had been discovered. As you would anticipate, they panicked and ran. While fleeing, they nearly got into more trouble. Arriving at my kitchen breathless and concerned, they felt a need to confess their sins.

They were good kids, so I first told them that although they really shouldn’t have engaged in the activities that they had, it wasn’t really all that bad. Also I added, there weren’t many adults who had escaped adolescence without having been in a little trouble themselves. While it may not always seem so, if you stand up and face your difficulties, people will generally be more understanding than you might anticipate.

I told them that the next time they get caught doing something that they shouldn’t, they should do four things. First, stop doing what you’re doing. Second, identify yourself. Third, apologize for what you have done. And finally, make amends as best you can.

Businesses aren’t all that dissimilar from mischievous youth in springtime from time to time. Similar advice might be in order.

To begin with there are very few businesses that have been around long enough to be successful that haven’t had some problems in the past. Most experienced business people will be surprisingly understanding of your problems and mistakes if you deal with them in a forthright manner.

The unforgivable sin is to run or hide from your problems. Just like those two boys on that spring afternoon, running from the problem only makes it worse. The business equivalent of running is commonplace. It manifests itself in unreturned telephone calls and unrealistic promises, both of which accomplish little other than provide temporary relief. But hiding will only make the problem worse once you’re eventually exposed. In editing the letters that my business associates had written, I found myself incorporating the advice I had given those mischievous boys several years earlier.

If necessary, begin by introducing or identifying yourself. “I am the owner of XYZ Corp.” People are more understanding of problems if they have a face behind them. Don’t send letters from “the sales department” or some other faceless functionary. Step up and take your punishment like a man or woman.

If the letter is about apologizing for a problem or a screw-up, don’t beat around the bush. Apologize! Don’t make excuses or attempt to obfuscate the issues, that will only get the other party arguing with you about who is at fault and who is being hurt. When it’s your fault, come right out and say so, you’ll be surprised how understanding most people will be. Being forthright in admitting your mistakes is a disarming strategy that can win you a lot of points.

In business it’s not always as easy to stop doing what you’ve been doing as it is when you’re a teenager. Sometimes a late payment, quality or delivery problems can’t be solved overnight. But you sure can fess up to what you’ve been doing and put forth a sensible plan and timetable for how you will remedy the problem in the future.

Business problems are never totally one sided. When you’ve got a problem it’s easy to be defensive and look to shifting part of the blame to others. My experience is that when you are defensive, it only makes the other party less sympathetic. Don’t forget that your goof has caused them problems too. Your unpaid bill may well mean they too have problems paying their bills.

Next time you get yourself in one of those business cracks that all successful businesses find themselves in from time to time, remember the advice given to those mischievous youths. It seemed to keep them out of trouble (as far as I heard anyway) and it helped contribute to a couple of good letters.

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Business Assets

November 22, 2009

Business are built on a base of assets; cash, receivables, inventories, patents, trademarks, equipment, and real estate. But in the final analysis, “business is people.” Regardless of the level of investment in all your other assets, it’s your people who will ultimately determine the performance of your business.

I was in the parts/service area of an auto dealership recently. The service managers was completing a job estimate for another customer who had phoned in a request. One of the employees of the parts department was standing near by. He was leaning back against a desk with his arms crossed in front of his chest. His bearing lead me to believe that he held a responsible position, perhaps he was the parts manager.

The service manager turned from his desk and extended some paperwork in the direction of the parts department employee and said, “I’ll need an estimate on these parts to complete this job.”

The parts manager remained fixed with crossed arms as he turned his head to look at the clock on the wall which read 4:45 PM. He then smirked and replied, “It’ll have to be tomorrow, its five o’clock and we’re closed.” Someone in the background said that tomorrow was Saturday. He shirked his shoulders and said, “I guess it’ll be Monday then.”

The story sounds a bit dramatic, but I’m afraid its an altogether too commonplace occurrence. With all the time, effort, and money that has been spent by American industry, particularly the automobile industry, to improve customer service and productivity, this is a good reminder that money doesn’t solve problems, people do!

That same week I went to the movies with one of my daughters. The movie that we wanted to see was playing at one of those new theaters that really is several little theaters combined. After a brief wait in line, it was our turn to buy our tickets.

I asked for two tickets to the movie we had chosen. The ticket vendor politely replied that there were only front row seats remaining for the seven o’clock show. Front row seats in a movie theater are not such a good deal. We were about to leave, but made a last minute decision to buy tickets to one of the other movies that was scheduled to begin at about the same time.

As we proceeded to our show, I stuck my head into the door for the movie that we had been told there were only front row seats remaining. The theater was half empty!

I’m certain that the ticket sales person hadn’t intentionally mislead us, but the result of that misinformation was almost a lost sale. How many others in that line decided to walk away?

Another example. I was recently in a well known restaurant for dinner with my family. One of my children asked the waitress for directions to the rest rooms. A puzzled look came over her face and she said she wasn’t sure where they were either. I should have gotten up and left right then!

The waitress was more than pleasant and was embarrassed as she explained that she was new on the job. What kind of managers were responsible for putting a new employee in a situation like that? While you might disregard this as a poorly managed establishment, I suggest that the situation repeats itself all too frequently throughout business and industry. This was not an otherwise poorly run business.

Why do some employees quit at 4:45 on Friday afternoon why others remain on the job, sometimes long after closing time, until they’ve met all their responsibilities? Do you suppose that ticket sales person would have passed on that erroneous information if her income was dependent on how many tickets she sold that evening? Is it fair for an employer to send an employee out to do a job without first training them properly.

As you ponder your assets and liabilities at the start of this new year, determine on which side of the balance sheet your human resources are. In the final analysis, “business is people”. They can make you or break you. You get to make the decision!

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Don’t Sell “Salesmanship Short”

November 22, 2009

It was early on a Sunday afternoon and there were very few shoppers around. We happened into a store that sold small electric appliances. One item that we were particularly interested in had a sign that said, “ask for demonstration.”

We looked around for a sales person. There was just one and he was standing behind the counter engaged in a conversation with a security guard that had just strolled in before us.

I looked in the direction of the salesman, paused for a minute, and then asked if he could help us when he got a chance. He said, “I’ll be there in a minute.”

We would have conducted our own demonstration but the appliance was battery-powered and the sample had no batteries installed.

Several more minutes passed before we again attempted to interrupt the salesman’s conversation with the security guard. “Excuse me, do you have any batteries?” we asked.

“I’ll be right there,” replied the salesman.

We overheard the security guard say, “Go ahead, man, I’ll stop back later when you’re not so busy.”

The salesman came over, pleasantly greeted us, and asked what could he do for us. We stated our interest in the appliance and asked if he could get some batteries for a demonstration. He said he was sorry but they didn’t have any batteries.

Somewhat in disbelief, we thanked him and left. All stores keep track of their sales, but who counts the lost sales opportunities?

There are plenty of directions to point a finger if things aren’t going so well. There’s uncertainty about the economy. Are we coming out of a recession or are we spiraling into a deeper one? Consumer spending is down and some say interest rates might be heading back up.

Before you start pointing fingers at macro economic phenomena for stagnant sales, take a good look at your sales effort. You might well be pointing that finger at yourself.

I don’t know how economists factor poor salesmanship into the equation for declining retail sales, but I know they are a factor.

I know for a fact that there’s one store manager looking at a weekend sales report that’s lower than it should be, not because of a recession, interest rates, or anything else but a halfhearted sales effort. Anybody can sell ice cream on a hot day, it’s management’s job to insure that sales people are properly prepared and motivated to take advantage of every sales opportunity that comes by.

Five of the ten most common mistakes in sales are:

  1. Lack of preparation and an inability to provide the customer the information they need.
  2. Talking too much and listening too little.
  3. Focusing on product features and technology instead of the customers’ needs and interests. Customers are interested in results and benefits.
  4. Underestimating the value of establishing a rapport with the customer.
  5. Failure to set sales goals.

Can you name the other five? Make sure your sales staff isn’t prolonging the nation’s recession by missing good sales opportunities.

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Strategic Selling

November 22, 2009

Nobody ever went broke from selling too much. Your company’s ability to increase sales is dependent on the development of successful marketing and sales strategies.

Strategy is a word that is frequently associated with the marketing function. Marketing includes all those activities that are involved in planning, promoting, pricing, positioning, and preparing a product or service for distribution.

Selling is the last step in the marketing process. When it comes time for the selling however, the pressure to move products often creates a peddling process rather than allowing for the development of a successful sales strategy.

Product peddlers push products. Peddlers are focused on converting their product or service into cash. A successful sales strategy is focused on the needs of the buyer. Strategic selling is concerned with delivering a benefit to the buyer In the long run, those companies with well thought out and carefully implemented sales strategies are the most successful.

A successful sales strategy begins with positioning. Your customers, whether they are business owners, purchasing managers, or buyers, are called on by hundreds of sales people every year. You need to begin by differentiating yourself and your company from all the others.

Effective positioning begins by establishing a professional relationship. Make an appointment for your first visit. Successful people are busy, unsuccessful people aren’t so busy. Which do you want to be?

Try to avoid “cold calls.” They contribute to an image that your time isn’t important. After all, when do you make cold calls? Usually when you have nothing better to do. If, in truth, you “were just in the area and decided to stop by,” do so only for the purpose of making an appointment for another time.

Identify the purpose of this initial visit to be fact finding, not selling. Don’t insult the potential customer by leading them to believe that you won’t eventually have something to offer them, but let them know that you need to gather some information in order to determine if you might have something that would be of use to them. By establishing yourself as someone who is willing to listen before you speak, you will have positioned yourself as being different.

You have now established a fair forum in which to implement your sales strategy. Strategic selling requires an understanding of the business. Effective sales people must not only understand their own product, they must also have an understanding of their customer’s business.

Don’t try to be a know it all in somebody else’s business, you will only be an irritant. But by making the effort to understand enough about their business to appreciate their concerns, you will again separate yourself from other sales people.

Take the time to do the homework necessary to understand your customer’s industry. Know the terminology, the do’s and the don’ts, the keys to success, current issues, trends, and developments of importance. Early in your visit inquire as to their plans and what they are hoping to accomplish.

Armed with that knowledge, you are now ready to make suggestions concerning products or services that can further your customers objectives.

There will be times when you don’t have an appropriate solution. In those instances, a peddler will still push product. A successful strategic seller will confess that they don’t have the best solution available. Part of a successful sales strategy is recognizing that it’s a small world; friends and credibility will always pay greater dividends than a short term sale that yields a dissatisfied customer.

You should be proud of the product or service that you are selling, but don’t start out boasting about it to your customers. People really don’t care how sophisticated your product is, how technologically superior it is, or how long it has taken to perfect it. What they care about is how it will help them accomplish whatever it is that they want to do.

A successful sales strategy is based on knowing the customer’s objective and then showing them how your product can help them accomplish it. That’s what ‘benefit selling’ is all about. You don’t sell a great product, you sell the benefit that it will deliver.

When you begin as an advocate, you run the risk of creating an adversarial environment. When you begin by identifying your customer’s needs, you are then in a position to suggest something that might help them accomplish their objectives. In so doing, you have avoided the typical adversarial relationship that exists at the beginning of most sales calls. “Here’s my great product for all your money.”

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A Genuine Smile For A Guaranteed Sale

November 22, 2009

The Saturday afternoon traffic was backed up three or four cars in each direction. The busy intersection was controlled by four stop signs. The car approaching from the opposite direction commenced a left turn. Anticipating passing through the intersection as it completed the turn, we proceeded.

A second car from the opposite direction, an expensive sports sedan, ran the stop sign as it raced to follow the first car making the left turn. Stopped in mid intersection it was hard not to miss the arrogant look on the face of the driver.

If you’re not careful, it’s the sort of little incident that can raise your blood pressure for no good reason. The drivers familiar face and the initialed license plates indicated he was a prominent high technology executive, probably in town for a “relaxing” weekend.

Not more than a few days later another car continued through a stop sign and proceeded to merged in front of us. As the car rolled through the stop sign, the driver waved through the open window and shrugged his shoulder with a smile on his face as if to say, “I know I’m wrong but I’m in a hurry, sorry.”

The second driver’s friendly gesture caused us to react quite differently. Two similar incidents, but two different reactions. Why? It’s the difference between an arrogant scowl and a friendly smile.

It’s not just a smile. We all know the difference between a friendly smile and an artificial grin, and it’s a big difference. The friendly smile says “I’m one of you guys.” The grin is uncomfortably insincere and says, “I’m better than you and I’m getting paid to do this.”

A friendly smile can significantly impact the result of most anything you do. A smile is something that you can’t buy. But put a smile on your face and I guarantee you’ll be able to sell a lot more. You’ll feel better and so will the people around you.

Some of the most successful business people I have known, individuals I have admired for a number of reasons, are smilers. Is their friendly disposition a result of their success or a contributor to it?

Others carry great burdens but have the strength to maintain a smile. It’s makes both them and those around them feel better. It’s not always easy to smile, but in the long run it’s successful.

As a flight student, I can remember certain instructors that we called “screamers”. At your slightest mistake, the control stick would shake and the cockpit would reverberate with high decibel comments concerning your family’s ancestors.

Other instructors got the same message across, usually more effectively, in a pleasant manner. They just seemed happy to be alive and flying airplanes. They took things in stride and went about correcting mistakes with a “smile”.

Uncle Sam paid both the “screamers” and the “smilers” the same. But if it had been a free market system, the “smilers” would have all the customers. The “screamers” would have gone out of business and probably would have never figured out why. After all, they were just as good a pilots.

There is a mistaken impression in business that serious subjects require serious faces. Serious faces have been interpreted to be a sort of knowledgeable, professional scowl.

Nothing could be further from the truth. Show me the individual that can enter a meeting with a smile and put a room full of people at ease, and I’ll show you a winner.

It’s a difficult world and it’s not always easy to have a smile. But remember, it’s not so easier for the other guy either. That’s preciously the reason that a smile is so valuable. Smiles are contagious. They make feel people good and we all like that.

You can say “no” more effectively with a smile. Nobody likes being told “no” and most people don’t like having to say “no”. It’s a difficult and stressful moment. But even a “no”, delivered in an understanding manner and accompanied with a compassionate smile, will often lead to a better relationship.

It wasn’t too long ago that the competitive, workaholic, Type A personality was thought to be unhealthy. Type As were believed to be especially prone to heart attacks and other aliments. Recent research seems to indicate that only the hostility associated with the Type A personality is unhealthy.

It’s near impossible to have a genuine friendly smile while you’re felling hostile. The addition of a smile will make that competitive work all that much more productive and you’ll be happier and live longer to enjoy it.

Because it’s your business, smile. You’ll make more money, live longer, and be happier.

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“Friendship Selling” For Customer Service

November 22, 2009

The customer was doing business at the store for the first time. She had recently met the owner and wanted to patronize his business.

The store was impressive, but the employees seemed somewhat indifferent as the new customer browsed through. There wasn’t anything particularly wrong, but there just wasn’t anything particularly right either.

Several weeks later, the owner of the store introduced his friend to several of his employees. On the customer’s next visit to the store, the previously indifferent employees, greeted her warmly and couldn’t have been nicer.

A lot has been written about customer service lately, but there is really only one rule that your employees need to remember. “Treat the customers like they were the owner’s best friends.”

You can’t develop procedures that will apply to all situations, but you can develop a philosophy which will form the basis for making good decisions concerning customer service. “Treating customers like best friends” is such a philosophy. It’s a principle that any sales person can apply to most any situation. The results will be good.

Think about it. What companies do you like to do business with? Aren’t they the businesses that treat you special.

Don’t you like to shop where you are known and treated more like a friend rather than as an anonymous customer? You can’t always be known, but some sales people have a way of treating you like a friend right from the start.

“Friendship selling” is a principle that can be applied to all businesses. Depending on the ages and the situations, the principle may need some variation, but it can always be made to work. To achieve superior customer service, all sales people should develop this orientation.

Begin by treating the customer like they are the owner’s best friend. If you’re the owner, pretend the customer is your long lost best friend.

If your sales people are young and the customers are older, have your sales people treat the customers like they are their fiancé’s parents. If the age is the other way around, have your older sales people pretend the customers are their grandchildren.

Develop an orientation that makes that customer a VIP before you ever set eyes on them. A customer is not just a faceless entity at the other end of the phone. A customer is more than just another somebody who walks in off the street.

The reality is inescapable. We all like to be treated special. When we are, we buy more and feel better about it. Important people and friends get treated better, so start treating customers like they are your best friends. You’ll soon find they are!

While most businesses would deny it, the truth of the matter is that the average customer is treated like just another body on an endless conveyor belt. That’s bad enough, but tolerable. But being treated as average while others are fussed over is particularly irritating. While VIP treatment is nice, it can uncomfortable if it’s obvious that someone else isn’t being treated as well.

The most comfortable and productive environment is where the feelings of friendship, respect, and importance are the norm, not the exception. When you are treated as warmly on your first visit as you are on your tenth visit. When you are treated with respect whether you are buying or just looking. When you are given as much attention after you place the order as you were given before you placed the order.

If the key to good customer service is treating your customers like friends, how should you handle your adversaries? Be honest, we all have disputes. Your objective should be to conduct your business so that your adversaries don’t become your enemies.

The marketplace provides a positive incentive. Nobody makes money from their enemies! If you’re a good business person, the obvious principle is “don’t make enemies”.

It’s not always easy to walk away from a fight, particularly if you’re convinced you ‘re right. Outside of the momentary satisfaction, there is rarely any long term benefit to pointlessly pounding the other guy with your principles.

With the daily frustrations that we all must deal with, that’s a tall order. But if there is a profit motive to support you, maybe you have a better chance. When you minimize the number of enemies that you have in the world, your business will probably get better. But for sure, your health and happiness will improve

Because its your business, remember that friendship sells and enemies don’t buy.

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Winning Waitress

November 22, 2009

Salesmanship is the key skill in every business. Whether you are an attorney or an accountant, run a restaurant or a retail shop, in manufacturing or in medicine, the ability to sell is what separates average from excellent.

If selling is the key skill, you need to be sensitive to how your product or service is sold. As this story of the “surly server” points out, having a positive attitude is not a bad place to begin.

Vacations and family schedules turned my home into a bachelors pad several weeks ago. My son and I opted to eat breakfast out rather than cook for ourselves for several days. There were a host of choices for breakfast. I knew a couple of friends who regularly visited one restaurant for their “morning coffee”, it was nearby, and it had those intangibles that just made you feel that it would be a good spot for breakfast. Restaurant #1 received the first opportunity for our business.

The first day we ate there was O.K. With my nose stuck in the morning paper, I don’t remember anything particularly good or bad. But that’s bad for who ever owns that restaurant. When you get a first time customer in the door, you want to give them a strong reason to return.

Creatures of habit that we all are, we returned next day. Our waitress made us feel like products on an assembly line, just passing through, only to be replaced by others, just as unimportant. A second waitress refilled a coffee cup and cleared the table, all the while giving me the impression that I was little more than an intrusion in her already unpleasant morning.

As we departed, I saw one my friends sitting at the counter. Does he put up with this on a daily basis? Maybe a true “regular” gets better treatment. Whatever the explanation, I was going to find a new spot for breakfast tomorrow. They had lost our business.

The next morning my son and I walked a few extra blocks and went to restaurant #2. After being pleasantly greeted, we were cheerfully and efficiently served. A cheerful smile and efficient service can get your day started right. Over breakfast we discussed the importance of starting the day with a positive attitude, its impact on your work and those around you. It’s not always easy, but it’s worth it. I pointed out that restaurant #1 probably doesn’t even miss our business, an opportunity lost that they never knew existed. If that happens often enough however, they will be sentenced to mediocrity and be wondering why.

Just as we were about to finish our discussion, who walks into restaurant #2, you guessed it, the “regular” from restaurant #1. “What are you doing here?”, I inquired. “I just can’t take that other place anymore” he responded. The lost opportunities might be greater than I first thought for old #1.

“That’s funny you mentioned it”, I said, “we had breakfast there the last two days and just decided we weren’t going to put up with that surly waitress again.”

“Which one” he asked. “They’re all that way there. My wife thinks I’m crazy for going there, it gets to be a habit, but I think I’ve finally had enough”.

Bad attitudes are contagious, particularly first thing in the morning. That’s really the reason we took our business elsewhere, who needs to pay a grouch first thing in the morning when you probably can find one for free without looking to hard. How many others had reacted the same? It’s hard to tell, but it’s clear we weren’t alone.

Some restaurants view their servers as mere clerks and transporters of products from kitchen to table. Others view their staffs as elite professionals Either can be irritating

The true role of the server is that of salesperson. There is no more important position in any business. They are in face to face contact with the customer, they have a product to sell, they can alter the size of the order, the sale of high margin extras (desserts, wines etc.), influence the the customers perception of the value received, and impact repeat business and future sales.

If you believe bad attitudes are contagious, start by checking yours. Maybe you feel entitled to be a bit of a grouch first thing in the morning. Unfortunately however,your employees might pick it up and pass it on to your customers. Something you would never do directly, but that’s the problem with a bad attitude, it’s contagious.

Because it’s your business, determine who the sales people are and use good old fashioned selling methods, beginning with a positive attitude.