Prospecting

It’s a gold mine if you dig it.

Prospecting has the connotation of “hunting for riches,” and that’s as true in sales as it was out in the gold fields. For a professional salesperson, prospecting has two meanings: Looking for new customers and looking for new decision-makers at existing customer locations.

To be successful, begin by answering these simple questions: How much do you need to sell to new customers to accomplish your sales goal? How much additional business do you need to get from existing customers to accomplish your sales goal?

You answer these questions for two reasons: to determine how important these topics are and to understand how much effort is involved. As a rule of thumb, if your sales goal requires 30 percent of your sales to come from finding and selling new customers, you will need to spend at least 45 percent (and possibly as much as 60 percent) of your proactive sales time to do it. If you aim to generate additional sales at existing accounts, it’s only about a one-to-one relationship where 15 percent of sales require about 15 percent of your proactive selling efforts.

We start here because you need to understand that prospecting is a regular, ongoing time commitment. Depending on how big your goals are, you need to spend a significant portion of your time every day in prospecting activities.

There are several things you should do to prospect. First, look at customers where you have been successful and see what they have in common. What market segment are they in? How big are they? How are they structured? Begin by developing a profile of what a “good” prospect looks like.

After a prospecting call, the goal is not for the customer to know everything about your business, but for you to know a lot about theirs.

Second, put together a list of potential customers (or potential contacts in existing accounts). You can do this by reviewing the business directories of your territory, doing research on the Internet, asking your current customers for names of other possible customers, talking to other salespeople who call on your customers and who do not sell competing products for other companies where they are successful, talking to other salespeople in your company, and even following your competitors around to see where they are selling. Your goal is to create a list of customers or decision-makers that you need to call on.

Once your list is established, drop back a little bit and make sure you have a story to tell. Remember that when people have not bought from you in the past, they are less likely to start now, so think about some reasons why they should want to work with you. This is the “value proposition,” and you really need to be clear on this.

With all of this done, set a schedule for prospecting. Take the list you have created and schedule prospecting activities. When a salesperson tells me that a significant portion of his or her sales needs to come from new people, I expect to see an itinerary that shows a regular series of scheduled activities and, hopefully, sales calls on the companies/people on the list.

Good prospecting also includes a mechanism for tracking effectiveness. I recommend an account profile. Establish a simple format that allows you to see what you are learning on your prospecting calls. The most effective salespeople engage their prospects in discussions that allow them to share their needs. After you have made a prospecting call, the goal is not for the customer to know everything about your business, but for you to know a lot about theirs.

All prospecting efforts also have some sort of feedback loop. The ultimate goal is to find pieces of business to work on. After you have been working your plan for a month, take a few minutes to determine what you have accomplished.

If you have nothing to work on, maybe you need to tweak one of the following:

  • Your definition of a good prospect
  • Your prospect list
  • Your value proposition
  • The amount of time you spend on prospecting
  • The quality of your efforts.

In the old days, miners would load up their donkeys with picks, shovels and the like and head out to the gold fields. Remember that you have to get off your own “donkey” and employ the tools if you want to “strike it rich.”

Material Handling Equipment Distributors Association
Joe Ellers Meet the Author
Joe Ellers is director of Consulting Associates located in Clemson, South Carolina, and on the Web at www.joeellers.com.