Close out 2017 with holiday cheer: Contractor's Corner - Nov 2017
By Dave Stafford
When November rolls around, thoughts turn to Thanksgiving, turkey, trimmings and the holiday season. If you’ve had a good year, then you’re looking for a little something extra. If sales and profits have not been what you’d hoped, perhaps closing a few extra deals before year’s end is needed. This is an opportunity for you and your team to make some extra sales, show appreciation to loyal clients and usher in 2018.
PROPOSALS AND SALES GENERATION
There is no better time to review those outstanding proposals than now. Unless they are on a non-calendar fiscal year, it is natural for most clients to want to wrap up projects and purchases by the end of the year. Before you complete that proposal or fill out a bid, ask the question: “George, when do you expect to make a firm decision on this job and let the bid? If I can order the products for shipment right now, I may be able to get a slightly better price from my supplier and pass it along to you. Okay?” Many clients shoot for late November or early December-any later than that and they’ll find that schedules are compromised by parties, vacations and various holidays.
Are you going to get that job? Are you still under consideration? Did they receive funding to make the project work? Maybe George is being coy and stringing you along, or perhaps he just needs a push. “So, where do we stand, George? I’m running out of time to get the products and installation personnel lined up. Do we have a chance to do the job for you or not; how do we look?” More proposals are lost through neglect or lack of follow-up than for any other reason. You might as well find out now if you have a chance. In one case, I jokingly said, “You’re just too tough for me, Frank. So what would I have to do to get the job? Just tell me.” He did, I did, and we got the job.
STRATEGY AND THE BUYING DECISION
Does the project need to be done by calendar year’s end? Your strategy for pricing and timely follow-up may depend on this information. “Bill, this can be a quick-turn project, product delivery time within ten days, scheduling in two days, installation time three days, and punch out in one day. I can only make this happen if you make a decision by the fifth of December, okay?” Use this knowledge to push the buyer to give you the order. If there’s any delay, remind him again of the time frame and holiday breaks.
At the first of the month, people tend to forget weekends, Christmas Eve, Christmas Day and New Year’s Day. On the other hand, you may find out after judicious questioning that money will not even be available until January. One deal was locked up early because I explained how we could save the buyer some money by buying now. “John, if you’ll go ahead and sign the order now, I can have the mill get the product on the way to our warehouse. Shipment won’t arrive until January, so I can bill you then. Now you’re into the next year and will have funds to pay us for stored materials within 30 days.” John was happy because he could make the decision now, pay for materials next year and save money with last year’s prices.
PLAN FOR NEXT YEAR’S BUSINESS
Make an effective sales call by asking questions about 2018. How is business stacking up for your client? How is their budget for replacement flooring looking? Are they considering any specialty flooring? Will they occupy additional office space? It never hurts to talk about their plans, and if you are genuinely interested, that will be conveyed through your questions. Take along a couple of new, cutting-edge products, or be prepared to talk about a new niche business your company is promoting. Perhaps some new service for assets maintenance will interest them.
As part of this sales call, get a grade on your performance. Ask how you’ve done and where you can improve. “We try hard to make your dealing with us an easy process. How are we doing overall? How about the ease of scheduling your work? How would you rate us on a ten-point scale?” You may get more feedback by handing them a one-page form with well-thought-out questions asking them to rate you on a 1-10 scale where they write in the number. Leave space for them to provide comments. A stamped, self-addressed envelope to someone in your office is better than something addressed to you by name. “Gail, I’d really appreciate your spending five minutes to fill this out and send it back to us. Your grade will help us do a better job.”
GIFT GIVING TO SHOW APPRECIATION AND PROMOTE BUSINESS
Plan what items will be given to clients to promote business. Choose a range of items that run the gamut from an inexpensive gift package of candy or coffee to a bottle of nice wine, a large fruit basket, or custom tray of cookies. Will you be buying enough of an item to warrant special packaging, complete with your company logo? Is that appropriate? Maybe a coffee mug filled with candy or a thermal cup with your company’s name or logo. Generally, a low-cost per unit item, ordered in quantity, will keep your logo imprinting affordable.
A plate of cookies, a box of candy or a bottle of wine may get you the five minutes you need to make the right contact for future business. I once made a sales call in early December on a client. Walter had always been difficult to see, and once I was in his office, he spent most of his time telling me how busy he was and how satisfied he was with his current supplier.
This time, though, when I got into his office, I said, “I didn’t come by to make a sales pitch or even show you new products, but rather, to let you know how much I appreciated the business you’ve given us this year.” With that, I reached in my briefcase, pulled out a small gift decanter of his favorite bourbon and put it on his desk. Quick as a flash, the bottle disappeared into Walter’s desk drawer! “You know, Dave, I’m glad you stopped by; I was just looking at drawings for some new office space and will need flooring. Here’s a set of plans. Take a look and come up with a budget for me. Okay?” I got that project and continued to do business with Walter until his retirement.
A short, handwritten note of thanks may be the best way to show appreciation, and when in doubt, I recommend that. In this day of email communication, a handwritten note will stand out. It doesn’t have to be long or with fancy words, just sincere and genuine.
SCRAMBLING FOR NEXT YEAR’S BUSINESS
Where will next year’s business come from, and how will you tweak your offering for next year? It is about this time of year when sales forecasting, budgeting and planning for next year must be done. Look at where you’ve been and what needs to be done differently. There is no substitute for this type of review by each salesperson and manager. Where did my business come from this year; how profitable was each piece of business; and how competitive was each segment? How painful was each piece of the business to deliver and collect, and have I built up a core business that I can count on for next year?
Each salesperson should be able to identify their top ten or 15 clients and forecast business from them for the coming year. Tabulating their sales should be done on a monthly basis. This will allow a better forecast for each quarter and will provide a valuable insight, on a cumulative basis, for operations and installation personnel. If sales volume is light during a particular month or quarter, it’s better to know this several months in advance to plan aggressive sales promotions to even out the workflow. If you know what is coming, you are always better prepared.
Will I need more personnel to handle certain business, or am I at a point where I need to consider retraining or termination? Additional personnel require time to succeed and make a difference; perhaps a new salesperson will operate at a dead loss for half the year. Put all your plans for volume, profit, personnel and support together and see if your goals make sense. If something is lacking, perhaps a new niche or a way to make more profit with an existing line is the way to go. Nothing beats effective analysis.
SHOW YOUR APPRECIATION
Show your employees that their hard work has made this year a success. Spend the effort and some money to make them feel special and important. It doesn’t have to be expensive or elaborate, but thoughtful; perhaps a special gift, an extra day off or a holiday party. Let them know you care about them as people. One company had a family party that included live music and Santa Claus for the kids. Another dispensed with a party and provided additional time off with pay. To celebrate the year, one company gave everyone a cash bonus in lieu of spending money for a catered event. Make it different each year and avoid the deadly dull, boring, typical holiday party with too much liquor and bad food.
Some owners see the holiday season as a distraction, where personnel are not at their most efficient and there are too many days off. However, it is also a time when most feel better about life and have a spring in their step, what with parties to attend and exciting events on the horizon. Use this time wisely by closing a tough sale, setting the path for next year and showing appreciation for the good things that have happened to you and yours.
Copyright 2017 Floor Focus