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- Small Businesses & Entrepreneurs
Prospecting from Your Contacts
Finding gems withing your contact list.
So you are sitting in your office knowing the rent needs to be paid, the power bill is coming due, insurance is a month behind. Your company car needs new tires, your air conditioner is on the blink and it is getting hot - and you need some business. Cash is better than credit cards and credit cards is better than a purchase order. Doesn't really matter how it comes - you just need for it to come!
How do you stir up some rain? How can you use the assets you have on hand to squeeze out a few quick bucks to make the month? Where are they? How can I get them? I don't have a ton of extra time I can set and work from - so it has to be time efficient. Can you say - address book? Your email address book - or maybe it is your company's contact list - that you casually have been building for the last 9 years of business is just sitting there. Sure, you refer to it occasionally when one of your customers needs something or starts sliding behind a payment or two, but you never have put together a complete product for getting the word out.
There are products out there like Constant Contact where you can hire them to utilize your mailing list to keep your products in front of your prospects in a very professional manner. The key being it takes about 60 days to build the interest in the email coming from you so it doesn't just end up in the "junk" mailbox. What is the key to making this work - and I mean for just about every small business and for some larger businesses?
Pick a product - be careful and specific. The attributes of the product that you are going to market include the following:
- It can be either seasonal, or, if not, it must be in generally high demand year round.
- It must have a normal significant gross margin - 30-50% minimum.
- It must not require special training, planning, or financing.
- it must have a fairly universal appeal.
- Others may want to retail it for you as well.
Once we have picked at least one product we can take a look at our list of contacts. Be selective as we pull together our lists of names for our "corporate" yard sale. We want to be sure we aren't accidentally involving vendors that call on us, our bank, customers that can't pay and always want two of whatever we have to sell. We do want to find all of the people we haven't been in touch with but maybe bought something that needs an annual or semi-annual renewal of some sort. Remember, what you are trying to do - motivate a buyer to do something.
I know there are office machine people out there that have a pretty good idea when every customer is going to need more ink. toner, paper, right? Industrial suppliers who know how long a cylinder of welding gas is going to last. Chemical salesmen can estimate to the hour when some customers are going to run low. The point is, if your customers utilized some kind of consumable - you know when they are going to run out - are you asking them for their business before they ask someone else to bring it to them?
Do you happen to have a larger ticket item that carries a decent margin and has a fairly broad range of acceptance. Let's say, for example, that we normally sell vacuum cleaners. We have one brand that has 100% gross margin and normally sells for $600 each. This means we pay $300 for them. If we are in the position we discussed on setting up this scenario, what are the odds of selling 10 of these today to cover the needs? 10 @ $300 is $3000 gross profit and may be just what we need. But what if we could sell 30 @ $400 each earning $100 per unit. We still get $3000, right? But guess what else we get? 30 customers buying bags instead of 10. We get 30 customers telling their friends about the product - instead of 10. And the odds of selling 30 of these with a 33% discount on an item that rarely has more than a 10% discount. Everyone likes something for nothing - and this is close.
How great the feeling when we now have 30 new customers we may never have seen before come into our shop and buy 30 new vacuum cleaners. If we treat these folks right - they will be buying more that just that one vacuum cleaner but bags, air fresheners, rollers, repairs, and referrals! Yes, they will be referring their neighbor, mother, friends and relatives. So when we calculate how much money we lost by not selling those 30 units for $300 profit on each one - we make back that $300 each -and then some - all the while increasing our dollars volume with our supplier lowering our base cost!
But how did we get them there? Remember - we sent out an email with a special specific to the vacuum cleaner we were going to market. Along with the 30 we agreed to sell at $200 off - we sold 10 more at normal price and all high dollars units - and bags and service contracts. We may even have sold some cheap units - $300 normal priced unit - that some people just like better for one or another reason - and they paid $250 for them - with us making $150 on these units. All the sudden our losing of $200 per unit sold is actually a fire built right under our sales! Call it a loss leader if you want - but we are making money on every sale!
So dust off that email list - put together a decent, short well worded not to your friends that tells a story about a product you know they want at a special price that you know they will pay for a limited time only because you need the money now - not in two weeks. Make it happen.
There is a new product out there I am interested in trying out called iZigg. It works off the premise that people don't like to read all their emails and have begun deleting or skipping over anything that looks like an advertisement. So iZigg has come up with a 5 digit code - 90210 - and a source code - that lets people connect with their prospects when they have a great deal or a special opportunity. It goes out as an IM to cell phones of your prospects. Finally - your prospects get hit all at one time - boom.
Of course you would need to be living under a rock not to have seen coupons lately. One in the Southeastern US is called Deal Goblin and is making slow but steady headway. The idea is a business can reach their prospects with deep discount advertising - that is free - in fact, the coupons are purchased and a portion of the purchase goes on to the provider of the product. So if a movie theater offers a "deal goblin" deal, they may say "buy 2 tickets for $5." The deal is a good one because 2 tickets may actually cost $15 so the buyer saves $10. The movie theater still sells the guy $10 worth of Pepsi and $10 worth of Boston Baked Beans. Who loses? The ad runs for 24 hours across friends on Facebook - and costs nothing. If they sell 10 or 100 tickets - some portion of those dollars go back to the movie theater, some go to the salesman and some go to Deal Goblin for managing the whole thing.
Hey, if you don't think the names on your list are worth anything - go to JigSaw.com and offer up some of the names you have - then you can trade up for the names you want - kind of a barter deal. Now you can clean up your email list and at the same time get a lost out -
Sell something - anything and do it well.