So you have decided to go into business. Congratulations. For the sake of an example, let’s say you have decided to start a travel agency. (Throughout the remainder of the book, I’ll use the travel agency example because I find that the “Thank you Mike” perks from travel agents are a lot more fun to use than, say, those from tractor manufacturers.)
You heard that business travel could supply a consistent flow of clients so you want to go out and sign up a few good accounts. Most people in your position, I’m sorry to say, would hire an outside salesperson and say, “There are millions of companies out there who travel for business purposes and who need our services. Don’t come back without a bunch of new clients.”
This is a mistake. The deck is shuffled. Most people get so excited about their new venture they just jump in the water head first and wonder what happened within a year or two. Let’s do a little walking before we break into a run.
If you worked for me, the first two weeks you would be at your desk or in the library creating a game plan so you would know exactly what we wanted to achieve every step along the way.
Divide And Conquer
The first step would be to outline a logical sales territory. Let’s go to school by learning from a couple of the more successful companies. Take a look at IBM and Xerox. They have zone managers, territory managers, divisional managers and national managers. They break down the country into saleable sections. They cut the whole pie into pieces.
Small business owners fail to see the logic of this simple yet winning strategy of “Divide and Conquer.” They insist on trying to be all things to all people . . . everywhere. When I ask travel agents in my sales seminars, “Where’s your territory?” they answer “New Jersey” or “Illinois” or “My territory? It’s anywhere I can find a client.”
If you’re going to be successful and your territory is “everywhere” then you better be able to tell me everything about “everywhere.” Say you think your territory is New Jersey, and I ask, “How many corporate accounts are there in New Jersey?” You answer “Thousands.” That doesn’t tell me anything. That doesn’t give me any confidence that you are on top of things.
Let me explain what I’m driving at from a different angle. If you’re playing basketball, you are playing the game “on the court.” Football players play football “on the field.” Clearly visible white lines mark out of bounds from the actual playing surface. You need to be on the field or on the court to be in the game. The same is true in ice hockey. You need to be on the ice to be playing hockey. If you are not on the ice, you are watching hockey.
Salespeople, to be effective, also need a well defined arena, a court, a field of play. In the game of sales, this is called a territory. And until you know exactly where your defined territory is, you cannot begin to create an effective prospecting and sales system.
Get this as straight as you can as early as you can. You can’t go out and sell everywhere effectively. Your brain can’t comprehend “everywhere,” so you will fail to systematically prospect what really should be your territory. Instead you will eventually short-circuit with sales overload and become another statistic on the “former salesperson” chart (the fastest growing chart in American history).
The solution is easy. Define your selling territory. Start defining it as it relates to your specific place of business. In our travel agency example, your territory may be a set distance around your office from where your “product” is distributed.
Think small in the beginning. A mile from your business might be a good starting point. I know what you’re thinking. “I already have accounts five miles away. Why should I be confined to such a small area? There is action out there, and I want my piece of it.” That’s fine. Keep ‘em. But I still want you to define and start developing a territory one mile from your primary location. Trust me. This is the only way to do it.
Once you define your territory, make it your business to know what’s in that area. Let me ask you a question. Do you now know where every business office is within your one-mile territory? Have you called every one? Are there any new startups which could be insulated or hidden? Is there a new suite of offices in your territory with twenty-five guys who could use your product by the ton?
My point is this. There are many of these “little gold mines” near your office that you are not presently aware of. (Often they don’t look like prospects . . . until they become clients.)
Why be concerned locally? Because all things being equal, if your business is equal to the competition in every other way, the single factor that separates you from the rat pack is your proximity to the prospect’s front door.
Once you have defined the territory, two challenges common to start-up business efforts must be faced head-on immediately. The first one I call your “Awareness Factor.” Simply put, not enough people beyond the confines of your immediate family and friends know that you are alive. You are just another Yellow Page line paying rent down on Main Street.
Your second problem negatively affecting your future eating habits is that once prospects know you are alive, they don’t (yet) have a single reason to choose you as a provider of goods and services.
Your objectives just became clear. You have to make sure more people know you are alive, and then you have to give them plenty of reasons to want to do business with you. Once you realize the importance of this last sentence, the game becomes fun, and you will be in for the ride of your life.
You must be realistic when creating a prospecting game plan. If you create an overly ambitious plan that will cost an arm and a leg, it’s not going to work (unless you were smart enough to cash in your Internet stocks at the top). So your plan has to fit your budgetary constraints
Time is another issue. You have little league games, on-call chauffeuring duties for the kids, church functions and other personal commitments. You want to get ahead, but you don’t want to put yourself in the bondage of sixty to seventy hour workweeks. The system I am going to outline can fit into any time constraint and still work for you.
Let’s put a ribbon on this territory thing by citing one last example. Say we just
opened a flower shop on the upper east side of New York City on 76th Street and Third Avenue. We are as excited as two people can be. I’m the flower arranger, and you are my only salesperson. After we open up and toast our success, I send you almost eighty blocks away down to Wall Street to sell flowers. Does that make sense? Of course not. In New York City every two blocks has a shop where you can buy a bouquet of flowers. Every two block square has a drug store, a grocery store, a liquor store. Every two block square has everything you could ever need. The shop owners in New York City are smart enough to realize that their territory is two blocks . . . and that is a big enough territory because it is filled with people. Therefore it is a foolish waste of time and energy to run down to Wall Street to find a customer. We have plenty of would-be buyers in the immediate vicinity.
Many small businesses, including travel agencies, establish a business presence on Main Street and then start running all over the countryside trying to sell their product. A little discipline is needed here. Define your territory and then start digging.
Hit The Books Before The Bricks
The next step involves a little research. You want to find out how many people within that territory might have a reason to talk to you or have a use for your service. Here’s another example.
Suppose your sixteen-year-old daughter wants to make a few bucks to go see *NSYNC. Babysitting is a natural, but she doesn’t drive. And for purposes of our example, Mom and Dad’s Limo Service is closed. (Clearly this is a fantasy example.) So, her territory has to be limited to walking distance from the house.
Is every house within a mile a good prospect? (Again, fantasy strikes . . . assuming any teenager would walk a mile.) Of course not. Many homes don’t have children. Many homes have children, but they are old enough to have already copped *NSYNC tickets from a scalper. Obviously, just because a house was built within her territory, doesn’t mean it automatically qualifies as a prospect for baby sitting services.
But once your daughter has identified those specific houses with kids between six months and ten years old, her job of selling baby sitting services becomes very straightforward.
The same is true for small businesses. Once you have defined your territory, you have to identify all the potential customers (prospects) in it. One easy way to get started is to visit your town library and ask your reference librarian for help. Every state publishes these resource tools. These books cost about eighty dollars apiece, but you don’t need to buy them. (If you are “e-powered,” go to the appropriate state’s “.gov” web site and start surfing.) For example, if you are selling to industrial or manufacturing companies, ask to see your state’s Industrial Directory.
These resources are typically organized by town and/or county. Decide what towns or counties fall within your defined territory. You will find the following information listed for each manufacturing company: The name of the company, address, phone number, products they make, sales, square footage of the plant, when it was established, number of employees, and corporate officers (e.g. chairman, president, treasurer, purchasing agent, controller, etc.) You will find out who the directors are, who they bank with, and who their accounting and law firms are. All this information is going to be listed on a single page, and there will be thirty companies per page. Now this is called jumping out of the blocks on a mission.
Here is where salespeople who take shortcuts make a costly error. The companies listed on these pages are not prospects. By definition they are nothing more then “suspects” at this juncture. Here’s the difference. When you think someone has a need for your service, they are a suspect. When you know they have a need for your service, they become prospects.
How can you tell the difference? Phone the company and say,
MM: “Good morning, my name is Mike Marchev from Small Company USA. I am updating my mailing list and at the same time asking two questions to complete a survey. Do you have time to help me out today?”
They will say “yes”. . . or they will say “no.” If they say no, do not take it personally. But in 99 out of a hundred calls, they will say yes. You then say,
MM: “Does your company travel for business purposes?” They will say yes or no. If the person says “yes”, the company might be a
prospect. Follow with this question,
MM: “Does your company use a travel agency?” The person will answer either yes or no. If yes, that is a pretty good clue that
they might be a prospect. If they say that they don’t, ask another question,
MM: “Does that mean you book tickets directly with the airlines?”
Once again they will respond with a yes or no. That’s all you are looking for right now. You don’t want to try to sell anything or give the impression that you are eager to gain entry into their work environment. They didn’t ask you to call, so in effect you are an intruder.
Remember, at this stage of the game all you want to find out is who uses your type of service or product so you can determine if they qualify for your prospect list or not. When companies eliminate themselves from your prospect list, don’t interpret this as a bad day at Black Rock . It isn’t. Quite the contrary, it is good news. Your success rate will improve the more tightly you define your prospect list’s qualifications. You can’t afford any deadbeat candidates on your list. You must become highly disciplined at building your prospect list. That means controlling your natural salesperson’s optimism. No, that octogenarian couple that runs the “No Chew Luncheonette” is not likely to franchise the concept and begin flying all over the country. Scratch them off the list.
So, that’s how you get started, but this job is never over. You must continually look for new names for your prospect list. Growing your list will soon become a very enjoyable and rewarding part of your business.
Now, I can hear many of you saying, “but I don’t sell to manufacturing companies.”
The State Industrial Directory was an example. I still want you to make contact with your reference librarian. Naturally, I suggest that you use the appropriate directory that makes the most sense to you.
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