Small Biz 101: Tips for Increasing Sales RyanC 04 Jan 2006

33 comments Latest by Bill Snyder

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Happy new year everyone! Hope you had a rockin’ holiday season.

This is the 4th article in my Small Biz 101 series here on SvN. The first three were: How to Get Started, Cash Flow Basics and No One Starts with a Masterpiece.

In case we haven’t met before, my name is Ryan Carson and I’m the founder of Carson Systems, where we work hard to bring you Carson Workshops, DropSend, The Future of Web Apps and Vitamin.

The goal of this series is to share some of the lessons I’ve learned from starting my own small business. With that in mind, I’m going to tackle the tricky subject of how to bring in the dough.

How to bring in customers

So you’ve quit your 9-to-5 and you’re ready to make millions. How do you get started?

Welcome to the world of sales. Whether you’re in the service industry or the product business, you need to sell, sell and sell some more.

You may be thinking "Wait a minute. I started my own company because I’m passionate about XYZ, not to be a salesman." This couldn’t be further from the truth. As soon as you start your own company, sales is your raison d’être. Don’t stress though, it’s not as bad as you think.

I’ve had the privilege of being in both the service industry (working as a web developer) and the product industry (selling web applications), so here some tips and tricks I’ve picked up along the way:

8 ways to increase sales

  1. Network like a crazy person. People do business with people they know and trust. It’s that simple. However, when you’re out meeting new people, don’t just think about ways they can help you, think about how you can help them too.
  2. Create a niche. Pick a specific area to excel in and tackle that. This will make it much easier to focus your efforts and beat the competition.
  3. Get your pricing right. Often when you start out, you won’t get your prices quite right. We recently encountered this with Carson Workshops. We decided to drop the prices from $695 to $495 on our US workshops (Getting Started with Ajax & How We Built Flickr). It was a tough call, but in the end we felt it gave the best value to customers, while still retaining reasonable profits.
  4. What’s In It For Them? As I mentioned in my first article, these are some of the most powerful words you will ever learn. Why would someone purchase your product or service? What will they gain? Be harshly honest.
  5. Don’t be an ass. This may sound obvious, but people like doing business with nice people. If you’re friendly and kind, it’s way more likely people will become repeat customers (not to mention the fact it’s just a better way to live).
  6. Do unto others as you would have them do unto you. Put yourself in your customer’s shoes. Treat your customers like you would want to be treated.
  7. Be thrifty with your marketing. In the early days of Carson Systems, I threw away tons of money on things like direct mail, phone calls, ad campaigns, etc. Most of the time, it’s just not worth it for small businesses. Things like blogs, newsletters and networking, are virtually free, whilst being very effective.
  8. Use a CRM tool. A great way to keep in touch with your customers and encourage repeat business is to use a customer relationship manager (CRM) tool. If you want to give someone a call and can’t remember what you spoke about last time, a CRM tool is invaluable. I’ve heard the 37signals crew have something up their sleeve in this area, so keep an eye out.

So hopefully you’ll find the above tips useful for getting new customers, but how can you deal with the inevitable rejections that will come your way? Here are a couple useful tips:

5 ways to avoid discouragement

  1. Be realistic. There’s nothing worse than making crazy optimistic goals and then crashing back down to reality. Start off with realistic, achievable sales goals. When you hit them, congratulate yourself and increase them.
  2. Make daily goals. If you know you need to get five new customers a month, then work backward from that and figure out how many contacts/phone calls you need to make to achieve those five sales. Then divide this by the number of working days in the month. If you have an achievable daily goal, you’ll feel great when you check it off your list.
  3. Find someone to encourage you. I spent the first year of Carson Systems as the sole employee and it was insanely discouraging at times. If it wasn’t for my wonderful wife and faithful cat (who I found myself talking to), I would’ve given up. Find someone who you can have a beer with on a weekly basis, and share your victories and defeats with them.
  4. Get the hard stuff over with first. If you know you hate a certain task, get it over with first. After it’s over, you’ll feel exhilarated the rest of the day. If you put it off till the end of the day, you’ll spend the whole day dreading it.
  5. Don’t take rejection personally. A large percentage of potential customers will say no (and some will even be nasty about it). Just remind yourself that it’s totally normal and they’re not rejecting you personally.

Summary

I hope I’ve given you a couple ideas on how to increase sales and steer clear of the inevitable discouragement that will come your way. If you put these ideas to work, you’ll have a good head start on the competition.

In the next article, I’ll dish out some juicy tips for self promotion and marketing. Meanwhile, if you’ve got any great tips for getting new customers, please comment below.

33 comments so far (Jump to latest)

Sandeep Sood 04 Jan 06

Do shit for free.

Sometimes, what it takes to build customer trust is to do something small for free.

But, make sure of the following:

- Ensure your trust that the customer has work for you (and a budget to support your expectations)

- Clearly define a scope for what you are going to do for them.

- Manage the free work professionally, as if it was a paid project.

For us, when we were a tiny company (aka, me in my studio apartment) without too many big names to show in our portfolio, doing work for free has helped to turn suspicious prospects into long term custoemrs.

paulo 04 Jan 06

Ryan —- great stuff. I started my firm three years ago and your advice is spot on.

What CRM tools can you suggest for a small firm?

I just brought in two partners and need to move from my iCal/Addressbok/Sticky Notes/To-do list way of doing things to something we can use collectively. We need to share calendars, track leads and opportunities, etc. It is proving to be difficult to keep waiting for Sunrise…

sj 04 Jan 06

A couple of options exist - if your team is internal you can use ACT! (not online - remember when this was an option?) It’s easy to use and very good for what it is.

Goldmine was great back in the day too. You could set up ‘tracks’ of communication - for example, after a sales call you could have a reminder to call them in 7 days, have it print out a form letter 30 days after, and so on into the future. In college I set this up for a few clients and it worked really well. Not sure if it’s still around anymore though…

A more robust (almost too robust) online option is SalesForce. Their prices are extremely reasonable and the feature set is impressive. A bonus - an API so you can have it do exactly what you want to do (perhaps create a dashboard or Konfab widget.) It also integrates really well with Outlook, so you can track any communication you have with a client.

My big beef with it is that it’s kinda ugly. And their homepage takes forever to load. But it definitely gets the job done.

Nice post Ryan…

Scott 04 Jan 06

A valuable and compact rundown. I’ve also found that networking through friends & family is quite effective.

Furthermore, you gotta have guts. If you’ve got a product that’s truly useful for a potential client, sometimes telling them about it with a phone call or email can win you an account. Don’t be pushy, just educate them on what you’re doing.

Mathew Patterson 04 Jan 06

More good stuff Ryan. Of all of these points I think number 2, pick a niche, is key. There are so many competitors out there, and having a niche is a great way to reduce your competition, ideally all the way down to 0.

I’ve posted about how I am finding some short term income recently, ‘short term’ as in this week.

Ebrahim 04 Jan 06

“Avoiding Discouragement” is (and has been) the main and most important aspect of every successful business, rest is easy and achievable.

Ryan Carson 04 Jan 06

Thanks for the kind words everyone - glad the series is proving useful.

On the CRM front, I use Outlook’s Business Contact Manager. However, it’s clunky, so I’ll be switching so something else.

Tim Almond 05 Jan 06

The strategy that Sandeep suggests is the one that I’m following..

If you are small, you are fighting for exposure with a lot of other small companies. If you build custom web or mobile apps, why is someone going to use you over another company?

Giving things away, it seems to me can either get your product known (if there’s a paid for version). Alternatively, you can take a strategy of giving away some code (like some .net controls/python widgets) with a plan to exposing your expertise. Or both, of course.

I’ve tried “networking clubs” and they are mostly a complete waste of time and money. Almost none of the companies have any budget, and mostly they’re too small and simple to want to have complex software solutions.

Jon Vaughan 05 Jan 06

Offtopic this - so apologies - I have no affiliation with but I have recently used and liked the vTiger CRM product. Its open source, PHP and MySQL and pretty straightforward to get working.

Ivan Minic 05 Jan 06

Very good selection!

TJ Mapes 05 Jan 06

I thought that was a great insipration to young entrepreneurs. I also won’t be able to make the carson workshops, but with I could and wish the best. Sounds like a great thing.

Kieran 05 Jan 06

“Get the hard stuff over with first. If you know you hate a certain task, get it over with first. After itís over, youíll feel exhilarated the rest of the day. If you put it off till the end of the day, youíll spend the whole day dreading it. “

What if the hard thing is taking all day + the next 2-3days, like this spec I’m writing :)

I bet a good way to get/build up your customers is by posting on a blog with loads of customer and dropping a few links to your website in there!

Great work guys
K

Paul Larson 05 Jan 06

There is definitely good networking and bad networking. Bad networking is when you’re in a room full of mortgage and insurance salesmen. Good networking is when you’re in a room full of folks in your target market, which also helps you avoid those that want $250 Web sites. I networked like a ‘crazy person’ for a year, but it just produced a long list of bad leads. Good leads and good clients are more important than sheer numbers of contacts.

Thomas Marban 05 Jan 06

CRM: vTiger or SugarCRM
cīest ca!

Prashant Singh 05 Jan 06

Great stuff ! your guideline are really very helpfull in managing day to day affair of a startup . specially the bit about doing sales jobs . based on my experience as a sales guy in IT industry i can say that most people think of sales as a necesary evil some thing which is beneath there dignity . your views are refreshing .

about networking sites i would say they can give a good starting point . you can’t really measure the ROI and mostly they can be an add on mot the core actvity for lead generation .

Free CRM software like sugarcrm.com are reall helpful if you don’t have a dedicated account Manager .

amine 05 Jan 06

Good Stuff !!!
Donít take rejection personally…Shouldn’t, but kinda hard.

CodeNinja 05 Jan 06

Networking can take a significant amount of time out of your productive day (when done properly). When I first started my business, I was networking about every night at local customer hangouts, dinner with potential clients, golf on Sundays… the works.

I found that when I managed to land a few projects, I no longer had time to network, but when the projects were finished, I had no more work because I didn’t have time to smooze…

Then I got smarter and found a way to automate the process of finding targeted potential customers online… my sales tripled and I suddenly had the extra time to work on the new projects.

In short, work smarter, not harder.

Josh Williams 05 Jan 06

Spot on Carson. Wise words. BTW — Props to 37s on the selection of guest editors for SvN. Adds a lot.

John Brown 05 Jan 06

Thanks Ryan - much appreciated!

We’ve found using the niche technique and partnering with a couple other small businesses to be key for us. We can’t be experts in everything but with a handful of partners you’ve drastically broadened your expertise AND your potential client network. We’ve been very happy and are now working on how to scale our business (and ourselves) more!

Best of luck to all…

jk 05 Jan 06

My experience, like John Brown’s, has been that a few key partnerships make a lot of difference. (I’ve not taken the plunge to full time yet, but have been moonlighting about 20 hours per week for about 6 months.)

For example, we redesigned a site for a local network maintenance firm at a cut rate, expecting that we would get more business through them (in fact they had already refered clients to us). They are the trusted “computer guys” at many local small-medium sized businesses and get asked about web design often. They refer those folks to me because they are very happy with the work we did for them.

(Forgive me if this sounds over-the-top, but honestly, while I was writting this comment I got a call from someone these guys had refered accepting our proposal).

Thanks, Ryan, as a newbie to running a business, this is good stuff.

Anita Campbell 05 Jan 06

Hi Ryan, nice article.

Since you invited tips, let me add the following: track everything you do relating to sales — everything! You have to know where you are spending your time and what you are spending it on. Doing so will help you meet those daily goals you mentioned.

The most recent radio show I did was on this very subject. My guest on the show was Warren Greshes, who provides sales coaching for businesses big and small. Warren outlined a simple system for keeping track of critical sales steps, involving nothing more than an index card and a pen.

Of course, software would let you do the same sorts of tracking, along with all sorts of added features, such as reminders and follow-ups and management reports, that you can’t do very well with paper and pen. I’ll be interested to see the 37 Signals CRM system when it is available. Would love to review it.

Best,
Anita

christopher 05 Jan 06

Two points that can’t be stressed enough… Get the hard stuff over first, and have a cheerleader! Yesterday was a difficult day as I am faced with the reality of a very good job offer as a director of marketing vs. keeping the course and building the consulting business. Balancing the pressure of the mortgage, emotions, holidays… against the thrill of the rockstar dream is increasingly difficult.

Today I recieved a phone call from a mentor, friend, brother who is helping me with a realistic assessment of the situation, as well as picking up the chips when i drop them.

Thanks for you comments. They continue to allow me to guage my progress and daily success.

shari 05 Jan 06

Nice article, and spot on!

The urge to advertise is great, especially when you need to get your name out there. I’ve done several free, nearly-free, and even some quite pricey things such as ads in the paper, but mostly it’s the free and nearly-free things that really produce results for me. The one that paid off in spades was purchasing pens imprinted with my business name, phone number and url.

People will toss a business card, or stick it in their wallet or desk and forget about it, but everyone uses pens. And if they leave a pen laying around, somebody else will pick it up.

I got some cool pens for 38 cents a piece (had to buy 100). When they arrived, I gave a handful to a friend who took them to her office. Two days after giving her the pens I received a call from a man who got my name from a woman in my friend’s office who had picked up one of the pens. That job way more than paid for the entire box of pens, and I still had all but a handful left. Since then, more business has come in from the pens, but that first job just blew me away because of how fast it happened.

Bob 05 Jan 06

Fantastic article and great comments.

Some people say they can’t sell. I totally disagree with that. I’m no great salesperson, but like people and have learned more about people from selling than anything I’ve ever done.

In my opinion, you need these things:

1. Believe in what you’re selling. That it’s the best, the cheapest, you just love it, whatever.

2. If you get told no, you can walk out of that office and think to yourself, “Those people are idiots.” Sounds silly, but it’s incredibly powerful mentally. No, you don’t tell them to their face. They might still be your customers one day. It happened to me once they realized I was right. ;)

I took a “real” job after freelancing for years and the biggest thing I miss is selling. I would never have thought that before I quit doing it.

As for cheap advertising, anything that gets you noticed or seen is powerful. My former partner ran a grocery store. He asked customers why they came in to determine his most effective form of advertising. Was it radio? newspaper? TV? direct mail? No, it was the changable store sign at the road that people saw as they drove by and decided to stop in for that special on the board. That was a HUGE promotion lesson for me.

Edward Gardere 06 Jan 06

It helps to have a fantastic product that people want. I have been a distributor of printing and promotional products for 15 years. My 3 requirements to be successful are: price, quality & service. If 1 of these is missing, you are seriously hurting your sales potential.

I have enough business that I am not contacting my prospects and old customers enough. I hired my wife to be a customer service person whose job is to call, tell them about some new ideas, and let them know we want their business.

This has helped increase my sales even more. My job is to get the job done for the customer and my wife helps bring them in. Plus I dont have to pay her much….she makes up for it with shopping.

I use ACT and have for many years. If you have a Palm you can get Act for Palm and carry around all of the info you need in your pocket. Its great.

DW 06 Jan 06

How would I, in the health care arena, proceed with little to no marketing budget make a big spash!

AndyToo 10 Jan 06

Another great post, Ryan.

Can I push you (or anyone else) for a little more information on the ‘finding clients’ topic. Networking seems to be the best way forward - but how? What works - family/friends? Or going to local business groups? Any comments from experience?

Secondly, I appreciate the ‘don’t take rejection personally’ point - however, how should someone going about ‘getting rejected’ (as it were)? Are you talking about rejection when you call businesses that you think might need your services? Or emailing/mail-shotting? Should I try and arrange meetings with local businesses? Again, any comments from your experience on this?

Many thanks.

Vikas Anand 13 Jan 06

Great comments in addition to throughtful pointers from Ryan!

Being a small business owner, dedicated to doing what you are adept at doing, and knowing full well that you can provide better flexibility, better quality, better price, more benefits than features and better customer service than your bigger counterparts does make it disheartening to hear rejections.

But as Ryan and many of the visitors mentioned, one has to think of it as a part of the job and believe in what one’s selling. In my sales career, I have learned an important fact: you can not sell what you don’t believe in. The number of rejections that you face when you are selling a product/service that you yourself believe reduces a lot because of your hightened confidence.

As a partner and sales executive of a CMS, application development and integration startup, I encourage everyone in the orginization to think like a salesperson, whether he/she be a developer, business analyst, support guy, VP, or CXO!

Getting everyone in the organization to get the word out through networking with friends and family members first, can create an effective word-of-mouth marketing campaign - one of the best and most cost-effective way to market yourself as a small business.

Building mutually beneficial relationships even with your smallest suppliers, vendors and customers is an effective way to gain more sales as well.

I concur that spending too much money and resources on expensive advertising does not really reap much benefits for most of us small business owners. Looking and asking for referrals, marketing by word-of-mouth and investing your time and effort in leveraging low- or no- cost marketing tools are the right things to do.

I believe, “doing the right things” is a more powerful tool than “doing things right”.

Ricardo Aroca 16 Jan 06

A very good, and usable, web based opensource CRM application is XRMS. I’am using it now and is a really good support for my day to day work.

http://fart.hut1.ru 31 Jan 06

Very good site! I like it! I just wanted to pass on a note to let you know what a great job you have done with this site..Thanks!

David Norcross 01 Feb 06

Hello

First post in this forum. Received your link from another blog. Excellent thread. I wanted to throw in my two cents on CRM’s. I was a long time ACT! user and beta tester. Have tested many web based CRM’s and have tested the popular desktop versions like Goldmine and Maximizer. Without question the fastest, most robust, functional and AFFORDABLE CRM package is Time and Chaos. Great application and the support is just incredible.

Thanks for a great topic.

David

Jeff Stephens 22 May 06

I would like to add, especially to readers of this group, that in general your first contact with a prospective customer should not be through email. Because of the sheer amount of spam being sent to buyers, much email is deleted by administrative assistants or automated “spam-removal” systems.

Bill Snyder 28 Aug 06

I have owned this company for 25 years and have always been so busy worrying about getting deals in the door that we have done a terrible job of keeping in contact with our former customers which now number 12,000. Does anyone have suggestions for a contact management program we can use to begin to contact our customers. That will not cost and arm and a leg and is reasonable to understand.

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