Monday, February 24, 2014

Sales Question: How Long Do I Chase an Account?

A Question from the Sales Team:
How long should I pursue an account before I give up?

Chasing money is a timeless art.
A couple of weeks ago I was making coaching calls with a sales guy who possessed lots of potential but less than 18 month’s experience. He’s a smart, aggressive guy with a professional attitude.  He targets his accounts, studies his results and devotes time to prospecting.  But after nearly a year of calling on a couple of major accounts, orders still weren’t flowing.  As our day wound to an end, he asked me point blank, “How long should I pursue an account before I give up and move on?”  Here
are some thoughts for you to consider:

Was the customer properly selected as a prospect?
Is the customer in the right industry, possess the right potential volume and credit worthy?  A lot of this information is available via a little research.  Armed with a manufacturer’s directory, the internet and maybe a D&B report, we can narrow the answers to this question down rapidly.  Experience tells me this step could be completed in the first month of exploring the account.

Was the customer properly qualified?
During the first round of making calls on any new account, one critical task is qualification.  Here we answer this list of questions:
·        Is the account real? 
Sometimes sales offices with no real potential show up on our radar screens.  If your information says 300 employees, you can tell by the parking lot and building size. 
·        Is the company stand-alone or part of a larger organization?
This information is important for multiple reasons.  First, if they are subsidiary of a company that makes your kind of product, purchasing options may not include you.  Secondly, larger Fortune 500 companies often have supply agreements in place which restrict the supplier count.  We’ll talk more about this later.
·        Are your kind of products being used in the quantities you suspected?
A quick walk through the production or work in progress area will typically tell the tale.  Do you see your products being assembled into the machines?   Are there stocked shelves in the storage crib containing the kinds of quantities you need to make this a good account?
·        Are you able to gather information from the customer?
Does the customer share product and company information with you?  It’s impossible for you to do your job without information.  The list of information is long, but you should be able to ask: what they make, who they sell to, current suppliers, lead times required, design standards followed, government regulations and a bit about annual usage.

Is there some reason why you cannot do business?
Everybody already has a supplier; some have good suppliers.  Count your blessings or place a strong hand over your wallet anytime a customer tells you they were looking for somebody just like you and the day you walked in the door was a gift from a higher power.  A relationship with a competitor may slow down your work; probably making your work harder.  But, it’s not a reason why you cannot do business.

However, there are several good reasons why you cannot do business a potential customer.  Here’s a short list:
·        The company has a long term supply contract with a competitor which is strongly enforced.
·        The company is part of a larger organization with sister divisions producing your kind of products
·        The company has shared ownership with a competitive distributor.
·        The head of engineering, purchasing or some other high ranking person at the company is related to your competitor.
·        The customer is purely price driven and your offering is not the “low price” brand. 

Back to the original question:  How long should I pursue the account?

The answer is complex.  The simple answer is this; until you discover a reason why you cannot sell to the account, you should continue to pursue the business.  In the meantime, most salespeople manage a territory.  It’s a game of juggling and balancing time.  Current business is important.  However, many salespeople make the mistake of pushing this type of account to bottom of their priority list.  If the volume is right and if the customer matches well with your value proposition, it is in your best interest to continue to mine for information.  Sales opportunity could be just around the corner.

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