By Rhonda Abrams
Gannett News Service
Your phone rings. It's a prospective customer wanting information about your services and prices, requesting a bid or proposal. That's a good thing, right? Especially in this time of slow economic activity, shouldn't you feel lucky to have customers approaching you, inquiring about doing business with you?
Well, yes and no. Obviously, it's great to have potential customers knocking on your door. But not all prospects are going to convert to paying customers - no matter how good your sales skills, how competitive your prices, or how outstanding the quality of your products or services. The sad truth is that you can waste a lot of precious time and money answering inquiries and preparing bids or proposals for prospects who are not ready to buy or are just plain "looky-loos."
Figuring out how much time and energy to spend on prospective customers is a delicate and difficult balancing act.
There are ways to limit the amount of time, money, and effort you spend on dead-end shoppers.
1. Have general information prepared and available. Most prospects will try to figure out whether a company is a good fit for them before taking up too much of their - or your - time. Of course, a great and relatively inexpensive way to provide this information is on your Web site.
2. Ask questions of the prospect. By asking a few simple, non-intrusive questions, you can get a much better sense of how serious the prospect is. Some questions to ask:
What's the scope of the project?
What's the time frame for the work to be started and completed?
How soon will you be making a decision on a vendor?
How many bids are you getting?
What other alternatives (not competitors) are you considering? In the floor tile example, for instance, the question might be phrased, "What other types of floor coverings are you looking at?"
What are the most important considerations in your decision - price, quality, convenience?
3. Don't get star-struck. It's easy to get excited if you're approached by a large or well-known company or customer. Don't lose your judgment. Such customers often take up more of your time, take longer to make decisions, and expect highly competitive bids. Sure, it would be nice to have the biggest company in town or the star of the Major League Baseball team on your customer list, but is it worth it if you don't make a profit?
4. Give prospects a reason to make a decision sooner rather than later. If you can, come up with truthful, positive ways to encourage customers to make a decision quickly.
5. Be cautious of prospects who want too much information. Some prospects use proposals as a way of getting free consulting services. This is true of both small customers and Fortune 500 companies.
6. Don't count your chickens before they hatch. It's easy to get excited about a prospect, especially if it's a big one. So, keep a lot of balls in the air, and remember, a deal is not a deal until the check clears.
Rhonda Abrams is author of "The Successful Business Plan" and "The Successful Business Organizer." To receive her free business tips newsletter, register at www.RhondaOnline.com.
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