Thursday, April 29, 2010

The Sales Funnel

If you are creating a new data base or contact list, consider including a field that helps you to monitor what you are doing.

Each record on your contact list will hold a name, address, phone, email, postal code and so on – the regular stuff.

Now add a field called Sales_Status or similar, and let it be devoted solely to showing you how far along the process someone has progressed.

Each contact starts off as only-just-met-them-yesterday and in our wildest dreams soon ends up as made-the-sale-let’s-make-another-one.

It doesn’t really happen that way.

Some initial contacts develop quickly into a sale, and a repeat sale; some wither away and drop off, but they need not drop right off.

Let’s qualify a contact as they pass through our system;

(1) New Contact – we met them yesterday, literally

(2) First Communication – we have sent them and email, mail or telephoned them.

(3) Fact Finding – we have met them in conference to learn the nature of their specific problem.

(4) Solution Development – we determine by ourselves that we can develop and provide a solution. This is sometimes called proof-of-concept.

(5) Proposal – we issue a contractual document known as a Proposal. It will contain a deadline for acceptance, and a price that is valid until the deadline date.

(6) Discussion – we discuss with the prospect various aspects of the proposal; we put them at ease and convince them that we can implement this solution to their problem.

(7) Negotiation – we establish a final price, we agree on a schedule of dates for deliverable objectives.

(8) The Sales Order – we obtain the paperwork that leads to the monetary transaction – this may be as little as a Purchase Order or it may be a 50% deposit, or it may be payment in full in advance.

(9) Account Maintenance – what else can we do for this contact? We try to generate more business.

It will not escape your attention that we make no mention of working here; as a business owner our job is to get the business; we have a programmer/writer/facilitator who does the delivery. Our job is to keep those sales coming.

And yes, if we are a one-man form, we wear several hats.

To stay in business we need a steady stream of new contacts coming in the top, and sales flowing out of the bottom.

Some contacts will stop partway through. We don’t need to toss them out – they either stay “on hold” at their current level, or are cycled back into the top as “new contact” after a suitable delay; perhaps in 3 month’s time the situation will have changed and we’ll have another opportunity.

Each week, or each month, print off a summary of each level.

There ought to be a healthy volume at each level.

Any empty level is a dangerous sign that the pipeline is blocked.

Find the blockage and remove it.

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