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The Reason Your Business Isn’t Growing

Author: Jeffrey Mayer   |   August 19th, 2011

Why do some businesses grow, prosper and continue to thrive, while others hit a sales and profits plateau?

Okay, here’s another question, why do some salespeople  grow, prosper, and thrive while others never make it?

These are questions I’ve been pondering for the past 30 years.Here’s the answer: Successful small businesses – and salespeople – continue to look for new customers every day. Unsuccessful businesses – and salespeople – stop prospecting for new business.

Simple enough!

But why do people stop looking for new customers?

They lose their focus. They get bogged down in paperwork, proposals, meetings, and other administrative tasks. They spend most of their time doing miscellaneous ‘stuff’ and less than 10 percent looking for new customers.

They’re so busy they’ve no time left to get on the phone and look for new customers or even keep in touch with their existing customers.

Don’t Let This Happen To You?

A few days ago I had a disturbing conversation. It prompted me to write today’s newsletter, because I don’t want what happened to Tom to happen to you.

Tom has owned a specialty products company for many years. In his best years, sales were $3 million. But with time there has been a slow erosion of his customer base.

* His primary contacts at some of his best customers have left the company and the person who replaced him has brought in his own suppliers.

* Some of his customers have themselves experienced a slowdown in business, and reduced the size of their orders.

* Some of his customers have stopped ordering completely because their business is off.

* And other customers have been acquired by a larger company or gone out of business.

The loss of business is always gradual, but cumulatively it’s devastating.

Today Tom’s sales are down more than 50 percent – off more than $1.5 million – and he’s struggling. Profits are down even more.
He’s had to let many of his key people go and has taken a big reduction in his compensation. Today, he’s barely able to make ends meet.

Why has this happened? Because Tom’s stopped looking for new customers. In fact, it’s been so long since Tom’s looked for new business, he’s forgotten how to do it.

He’s now trying to do something he hasn’t done in years, and was never very good at in the first place.

That’s why he called me.

Looking For Customers

When Tom and I began working together, the first thing we discovered ?was that he was spending a lot of time with people who weren’t buying.

His closing ratios were about 15 percent. That meant 85 percent of his time was being wasted. (If he only wasted 75 percent of his time his sales would double.)

We came up with a more targeted approach. He started asking more detailed and specific questions to better qualify his prospects. He insisted on working directly with the decision makers.

He made being on the phone – EVERY DAY – his #1 priority, and scheduled 60 to 90 minutes each morning for the sole purpose of looking for new business.

He quickly discovered that at least 50 percent of the people he had previously been making presentations to weren’t legitimate prospects.

Many were price shopping.

Others called – usually with a request for a rush quote – because they needed a second or third bid so they could tell their boss they had shopped the market. Then they would give the order to their preferred vendor.

Because Tom stopped wasting his time on these non-productive activities, and stopped chasing opportunities that never closed, he had much more time to get on the phone and look for new customers.

He started working his database and prospecting for new business. In no time at all he found people who wanted to talk with him. He closed some sales. Cash began flowing in instead of flowing out.

Much to his surprise, there were a number of old customers who placed new orders with him. One even said, “Tom, It’s been several years since you last called on me. I thought you had gone out of business.”

Become A Huge Success?The difference between those who are successful, huge successes, or failures is in direct proportion to the amount of time spent looking for new customers.

Spend 90 percent of your time looking for new customers. And you’ll see more small business sales than you ever dreamed of.

Reprinted with permission from “Jeffrey Mayer’s SucceedingInBusiness.com Newsletter. (Copyright, 2003 – 2005, Jeffrey J. Mayer, SucceedingInBusiness.com.) To subscribe to Jeff’s free newsletter, visit www.SucceedingInBusiness.com

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One Response to “The Reason Your Business Isn’t Growing”

  1. Chuck Rylant Says:

    Good points here. I will add that people also don’t look for customers because it’s uncomfortable. It’s more comfortable to do those low outcome tasks you describe.

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