How to sell to the elusive small-business owner…
If you are in the business (or thinking of getting into the business) of selling to small-business owners, beware. It’s a tough market to reach and tougher even to sell.
Small-business owners are very busy people.
They may need your product or service, but they don’t have the time to think about it.
They are up early and deep into their work by the time that first cup of coffee hits their lips. Although they sometimes fantasize about kicking back in their chairs and casually reading through the marketing material in their inboxes, they seldom can.
When the time comes to make buying decisions, small-business owners are impatient shoppers, demanding buyers, and tight with their wallets. (The average small business has a net income of only 6.3 percent of revenues, so owners tend to pinch pennies.) But if you get their loyalty – earn it and keep earning it – they will stay with you for life.
And there are plenty of them. As of 2004, e-merchants alone accounted for about 10 percent of the U.S. GDP (gross domestic product).
A new book on this subject, Outfoxing the Small Business Owner by Gene Marks, landed on my desk yesterday morning. I scanned it very quickly during my afternoon cigar break, and learned some interesting facts:
- 80,000 small businesses open up every year in this country.
- The majority of U.S. small businesses use the Internet for online marketing.
- The average small business has six employees.
- The average age of a small-business owner is 49.
- About three out of 10 small-business owners do not have a college degree.
- The top three problems for small businesses are health insurance, federal taxation, and locating qualified employees.
Marks’ book also offers useful, practical advice – and some very inside insights – on selling to this growing and increasingly attractive sector of the American market. (He calls them “plucky foxes.”) For example:
Small-business owners are always on the run, so call ahead to confirm your sales visits. Maintain a very flexible schedule and be prepared to make changes for this chaotic customer.
Don’t gang up on the small-business owner.
If you show up with a team of six people in power suits, you’ll most likely alienate him.
Your product or service should save your “family fox” time. More time saved at work means more time that he can spend with his family.
Always offer a money-back guarantee to the glass-is-half-empty small-business owner.
This will help temper his lack of faith in human nature.
Your product or service must clearly show “the fat and happy fox” an increase in profits, so he will feel even more secure working with your company.
Don’t be deceived by the looks of a small company’s offices.
A derelict building may house a little goldmine. It may take five years to make a sale. Have patience.
My experience selling to small-business owners has been limited. When I was in my twenties, I did some direct selling and discovered I didn’t have the skin for that sort of marketing. Later, when I got into publishing, I had the opportunity to sell specialized newsletters to this market. We had modest success in the mail, but were less successful on the phone. It was tough to get them to listen to a sales pitch for more than 30 seconds. And if you did get them to listen, it was very tough to overcome their many objections.
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Maybe we would have had more luck with our small-business prospects if we’d had these tips on how to overcome four of their most common sales objections:
Objection Number One: “I have no money.”
First thing you need to do, Marks says, is believe him. Then get him to agree that he’d buy your product if he had the money. Keep at him until he agrees to buy it on some sort of payment plan. Offer financing, if you can.
Objection Number Two: “It costs too much.”
Jeffrey Fox has a good answer for this objection in his book How to Become a Rainmaker. It’s all about demonstrating value.
As I mentioned in Message #1684, people usually make purchases out of desire rather than need. And because a customer’s desires are often inscrutable and/or ephemeral, a good salesperson or marketer must think beyond the obvious when he figures out how to sell things.
“Rainmakers don’t sell fasteners or valves or washing machines or double-paned windows or tax audits or irrigation systems or training programs or golf clubs. Rainmakers sell money!” Fox says. “Rainmakers help the customer see the money. Rainmakers turn benefits into dollars. The plumber who generates the most revenue doesn’t charge $50 for a service call, he sells a clean, dry basement for $100, saving the customer a thousand-dollar carpet.”
Objection Number Three: “I can do this myself. Why do I need you?”
This objection is easily overcome with the “value of time” argument. Ask the prospect how much he could be making a year if his business were running at maximum efficiency. Figure out how much that equates to on an hourly basis. Almost certainly (especially if you have coached him correctly), that number will be a lot higher than the price you are asking for your service. Tell him, “The only way you can break out of the rut you are in is if you allow less-valuable people to do your less-valuable work.” Get him to agree to that proposition … and you have clinched the sale.
Objection Number Four: “Let me think about it.”
Marks says, “When a plucky fox says ‘let me think about it,’ he’s secretly telling you that he’s still interested in your product or service. It’s just that he’s still not experiencing enough pain to push him over the edge and make him buy. You need to create a sense of urgency, like a price increase or a horrific scenario that will occur if your product is not purchased. You need to overcome this objection by making sure your reasons for him buying are clear, the return on investment is obvious (and quick), and you’re hammering away the point again and again until the timing is right. After a while, his defenses will fail.”
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Marketing to small-business owners is a tough game. But if you have a good product, can sell it at a competitive price, and have the tenacity to work hard for that first sale, you’ll be rewarded with a loyal, profitable customer for life.