Hi, this is Scott Hallman and welcome to this week’s Tuesday Profit Tip where we bring you real world ways to Build-Grow-Manage-Profit from your business.

Many business owners say the 1 reason they fail to achieve their business growth goals is because of the lack of time (or desire) to sell. Whether you like it or not, “selling” is part of the game & a BIG part. Yet few business owners we talk to have been able to implement a sales system that produces consistent, measurable results, and even fewer that have a system that requires zero out of pocket costs.

The Fact is the Vast Majority of Business owners Either Hate to “Sell” or Are Poor at Selling… Are You One of Them?

It is estimated that 85% of businesses are started by “technicians” (according to Michael Gerber) that are good at producing the product or service they provide. So the consultant at IBM starts an IT Consulting business & the carpet cleaning manager at ServicePro starts his own carpet cleaning business, and so on. And if you are a professional (doctor, CPA, etc) you likely never ran a business, much less were trained to sell.

Now perhaps you are a great salesperson. But often find that you cannot seem to find the time to sell due to the demands of the business.

So what’s a skilled technician with weak skills or lackluster selling desire to do? Hire a Superstar Salesperson.

What’s a busy business owner with great sales skills to do? Hire a Superstar Salesperson.

But Hiring a Sales Rep Costly, and With This Economy I Can’t Afford it… or Can I?

Perhaps you are cash strapped and believe that you can’t afford to hire a sales person, even though you passionately believe that they can help take your business to the next level.

Or you have cash but have been burned by unproductive and flakey salespeople in the past and therefore have watched your investment produce little or no result. I see this all the time; a business will hire a sales rep (after 1-2 interviewed candidates) and pay say $2,500 a month (salary or draw). Then the sales rep fails to perform up to their expectations and the company let’s them go after 3-6 months. This results in $7,500-$15,000 of wasted cash. Then, determined to make this work, the company repeats the cycle 2-3 more times, now $25,000-$50,000 in the hole and conclude that hiring sales reps will not work for their business.

Three Common Mistakes That Guarantee Failure

There are three common mistakes that businesses make that lead to a failed sales team and the $7,500-$50,000 profit loss I mentioned in the above scenario.

1) The first is that they are paying for time and not performance.

2) The second is they are hiring without a system in place for dramatically increasing the probability of success.

3) The third is that they lack a management system that arms the sales rep with proper training and allows the company to scientifically measure and track progress and results.

For today’s tip I am going to cover 1 – Paying for time. The logical solution is to hire a sales rep on a performance basis – paying only for profitable results. This way you can literally build a sales team cost-free. “OK, Scott, I learned that one in kindergarten”, you say? Well, that may be true but if you have failed to get this particular “growth tactic” to work then stay with me for a few more minutes.

The Problems with Commission Only Sales Reps

If you have hired commission only sales reps in the past then you likely faced three primary problems:

1) Massive turnover
2) Poor performance
3) Management Headaches

First, the reality.

Sales turnover is guaranteed no matter how well you hire or you pay. In fact, a successful ratio is 1:4. One good performer for every 4 good hires (1:10 or even 1:25 without a good hiring, training, compensation and management system in place). It amazes me how the “sales gurus’ fail to share this reality.

One factor that causes unnecessary turnover, management headaches and poor performance occurs when the sales rep cannot realistically earn their baseline income requirements in the first month (or longer). They immediately lose enthusiasm and begin looking for another job on your dime.

If the sales cycle (the time to reach a qualified prospect, promote your product, get approval, get the contract signed, get the order placed, get the product shipped, and get paid) is 30 days or greater, then a commission only sales model almost guarantees failure.

As an example, say a company typically takes about 60 days to close a prospect and get paid. And they pay say 10% commission on a $2,000 average sale. The sales rep cannot make any money for at least 60 days! And worse, it may take 90 or even 120 days before they are making enough sales to generate their base income needs.

To help reduce turnover when paying commission only, we created a concept we call, “Salary-Like”(tm) compensation. What is that? It is where you pay an accelerated or inflated commission for a short period of time in order to help the rep earn their base needs. We teach a detailed program on this (I will be doing an upcoming Tele-Seminar on this subject) but the basic concept is to pay the sales rep for specific activities that logically lead to a sale, say for a written proposal and/or “accelerating the commissions” by paying 2, 3 even 5 times higher percentage during the first 2-3 months – so they can earn their base required compensation. As long as this commission does not exceed the gross profit it represents zero out of pocket costs.

Here is a Simple Action You Can Take

First, determine what hiring a full or part time sales rep could generate for your company IF they were cost free. Be conservative in your estimates.

Next, if the upside is significant, create a simple compensation plan that enables them to earn a reasonable commission month 1 – say $2,500. Do not be concerned as to whether you earn a dime on these initial sales (if they will be finding sales you otherwise would not handle yourself).

Next, place an ad in Craigslist and hire yourself a sales rep.

Small Business Growth Club Member Access

To learn how to hire, train and manage Sales Superstars, simply go to the “Sales” Training Section at www.smallbusinessgrowthclub.com to get full access (Platinum Members) to eight sales training workshops by my friend Chet Holmes, author of the Ultimate Sales Machine and Fortune 500 Sales Trainer.

Also, I will be announcing a teleseminar training workshop on this subject in the next few days, where I will go into complete detail on how to create a Salary-Like Compensation Program for any business, regardless of size, industry or management expertise.

Go for it. Do this simple exercise and Profit NOW(tm).

How to Double Your Sales Force Without Spending a Dime.

Welcome to this week’s Tuesday Profit Tip where we bring you real-world ways to Build-Grow-Manage-Profit from your business. My goal is that you earn at least $1,000 an hour for every hour you spend learning and applying our profit strategies.

We have all heard that developing strategic Partnerships or Joint Ventures can transform your business. This is likely the most powerful marketing leverage on the planet! As you have learned, there are tons of other businesses that have strong relationships with your targeted prospects.

YES, but do you know HOW to systematically develop such a program? If you are like the 94% of the 68 entrepreneurs that we surveyed (that have spent at least $2,000 on marketing programs) the answer is a solid NO!

I am talking about the critical details. To creating a winning formula– how to find, reach, and approach the right partners: what to say to them, how to craft equitable deal structures, contracts (if necessary), payment options, measurements, profit analysis and more.

A Guru’s Missing Advice causes Thousands to Fail…were you one of them?

I have talked to hundreds of companies that attempted to create strategic alliances and the vast majority failed. And they failed for a variety of reasons but one important reason was that they tried this with just 1-2 potential partners.

My friend and big time marketing guru, is one of the leading proponents of strategic alliances. One day we were spending a day together brainstorming and we talked about strategic alliances. So I shared that the problem is that most companies try this with 1-2 companies and then they give up. I said, and that is only the beginning of the problem. They have no clue on HOW to implement such a program.

He looked me in the eyes and said, “Well you know that you need to have 50 in play to close one great partnership!” I was blown away and said “Well, you never mentioned that in your seminars and training programs.”

So YES, Strategic Alliances can be powerful but only IF you know how to implement them. In our Strategic Endorsement System, we teach the complete 10 Step Detailed process. But for this week’s Profit Tip, I want to get you started on a simple way to drive in new clients, customers and patients using this powerful growth strategy.

Strategic Endorsement Opportunity 1
Get Other Businesses to Endorse You to Their Trusted Customers

How can you gain access to the customers of other businesses that sell products and services that compliment yours? If you could point a laser beam at your targeted prospects and then get someone they trust to refer them to you, this would be the ultimate in leveraged marketing, wouldn’t it? It is like having a separate sales force that you don’t have to manage or pay unless they produce profitable customers. Effectively taking advantage of this opportunity can double or triple the number of customers you can sell to, without any risk or cost to you!

In addition, the cost to reach these “ready to purchase” prospects is a fraction of what it would cost you in advertising to find such prospects. Why? Because the “strategic endorsement partner” you align with already has the trust of your target prospect – namely their customer. By them introducing your business to their customers, you instantly create a “warm” feeling before you even make your offer.

Let’s discuss three (3) ideal situations where other businesses can endorse you to their customers.

1) They can endorse your product or service to their customers that have a need, but which they can’t fulfill.

By them helping their customers to locate top quality companies with favorable prices and terms, they are really providing a service to them. And by you performing a quality service for these customers, you are performing a valuable service for this strategic endorsement partner as well – that is, you are helping them maintain a lifelong relationship with their customers. Make sense?

The second situation where other businesses can endorse you is…

2) When specific purchases trigger related purchases.

Many purchases are “linked” to other purchases. When these subsequent purchases occur shortly after the initial purchase, it creates an incredible timing opportunity for endorsement.

For example:

The homebuyer must choose a home inspector and mortgage broker within 48-72 hours after the offer has been accepted.

A person buying tickets to a play will often call for a restaurant within minutes.

A person booking a hotel for their wedding reception will certainly be selecting a dress, invitations and so on within days or a few weeks.

Wouldn’t it be of untold value to the home inspector if the Realtor informed them that someone just signed a contract? Or better yet referred this buyer to them – Boom, instant sale!

The third situation where other businesses can endorse you is…

3. When inquiring prospects don’t convert to customers.

These prospects represent someone that took the step to inquire, and you and your strategic endorsement partner can both win by helping these prospects purchase from you.

What are the situations that cause someone to inquire but not purchase?

The businesses’ product or service is either too high or too low in quality.

Perhaps the prospect wants to build an elaborate room addition and your strategic endorsement partner exclusively does framing. In the past he turned down the job, but now he can refer this work to you – the master builder – and in turn get both the framing job and a referral fee as well.

The business is too busy to service the customer timely.

What do most businesses do when someone inquires about their service and they are currently buried with customer orders? Right, they say “I am sorry but we are booked or can’t get to that repair for six weeks or can’t install your landscaping until next year.” Do we, the “I want it now” generation, wait? Heck no – we find someone else, don’t we?

This brings up a critical distinction:

The prospect that calls a hotel to book their wedding reception, only to find out that it is unavailable until after their wedding date, is really called what? An absolute guaranteed customer! After all, they will most certainly call other hotels until they find a banquet hall and 50-100 rooms won’t they?

If this hotel created a strategic endorsement with another hotel or similar quality, they now can say to the inquiring prospect “I am sorry we are booked but The Plaza Hotel is quite elegant (if a high end buyer). Their Grand Ballroom is filled with crystal chandeliers and beautiful mahogany decor. Louise has been a master wedding specialist for over 25 years. I can call to see if they have availability and have them call you or you can reach Louise at 555-1212. They could also say “If I call I can save you 10% on the entire package because of our affiliation.”

Wouldn’t this motivate these inquiring prospects to at least call?

Let’s Put This Information to Use

Ok, let’s identify where you may have strategic endorsement opportunities in which you can leverage off of other company’s client list.

What I want you to do is write down 1-2 opportunities that you have to provide your product or services to other competitors. Also, list which products or service would be the best fit. For example, the hotel could link up with wedding coordinators, churches, wedding gown shops and so on.
P.S. To access the full 90 minute audio training workshop and Implementation templates, simply click http://www.smallbusinessgrowthclub.com/public/356.cfm