You’ve done it. The months or years of toiling in your basement, garage, dorm room or tiny apartment have finally paid off. No more eating dry cereal or soup for dinner. No more working late in the evenings or weekends.
You have successfully created your first new product or service that you want to launch into the market. Your loyal employees who stuck by you are also thrilled. Your ship has finally arrived.
But wait a minute? You don’t know how to sell!
All those courses in computer science, coding, engineering or business never taught you the fundamentals of selling. Sure, maybe you watched a video or two of Zig Ziglar or some other great salesperson. Or you cracked open a sales book once or twice, or read some articles online. You may have even taken a workshop or two about selling. But beyond that, your knowledge of selling is weak.
You admit it. So now what?
Well, like most start-up owners, you decide it’s time to hire your first salesperson or two. But before you place employment ads, there are some things you need to know.
1). Do you really need a salesperson? Is your product really ready for the marketplace or do you still have some more beta testing to do? While no product is perfect, no salesperson wants to spend hours on the phone dealing with a constant stream of technical issues or complaints about bugs. Unless you are paying that salesperson well to be a glorified technical support person, you may need to go back to the drawing board.
For example, I recently spoke to a new business development manager at a Maryland start-up who complained to me that his company was having a high turnover of salespeople. Some would stay for only a few weeks or a couple of months and then leave. When I probed further, I discovered that his product was still being beta tested for the enterprise market. However, the good news is that his product was actually doing well in the consumer market, which didn’t require the same heavy technical demands as the enterprise clients. In fact, the product was receiving high ratings on Amazon and positive reviews from independent tech bloggers. I suggested to him that he immediately stop hiring salespeople until his product was more ready for the enterprise market. I also suggested that his company switch gears, and focus more on the consumer market since he was having greater success. Sure, maybe he wouldn’t generate as much revenue in the consumer market, but at least he would be receiving some cash flow and generating positive buzz.
By using public relations, partnerships, and affiliate marketing, I suggested his company could do quite well in the consumer market. Hopefully, that good well in the consumer market would spill over into the enterprise market once his market was ready.
2). Amateur or Pro, does it matter? There is a running debate within the start-up community about whether your first couple of salespeople should be amateurs or pros. Some argue that hiring inexperienced salespeople are better because they are hungrier and will hustle more. The argument goes that if you hire an experienced salesperson, he will not be very motivated to sell; instead, he would only rely on his contacts rather than making a lot of cold or warm calls. However, others argue that your first couple of salespeople should be more experienced because they can quickly increase your sales by their expertise and knowledge. In addition, they can also establish a sales process that can be used later when more inexperienced salespeople are hired.
My response – unless you are selling a highly technical product or service that requires advanced training and education, trust your gut and hire the salesperson who will help you generate a lot of sales. Young or old, if they know how to sell, if they are willing to learn about your product and market, and if they are trainable or coachable, hire them and get them prepared to hit the ground running.
Having a diversity of salespeople from different ages and backgrounds can offer your company different perspectives on how to grow your sales.
You can’t always judge a salesperson by his age, the length of his resume or his previous sales results. Sometimes you just have to trust your gut.
3). True believers, are they the best? Some start-up owners feel that only true believers, the ones who really understand their mission or see their vision, should be your first hires. Really? Chances are you may be hiring a wolf in sheep’s clothing – a con artist who pretends to believe in the “cause” but will quickly bail out as soon as your company hits rough water.
Look, forget about hiring true believers. You are running a business, not a religion. Just hire good salespeople. Once they start selling, if your product or service is good as you think, they will eventually become true believers.
I once worked for a small tax research publishing company where I didn’t know anything about accounting. However, over time, I became impressed with our products because our clients really loved what we were selling. Then and only then, did I become a true believer.
4). Should you learn how to sell? Let’s face it – popular culture has not been kind to salespeople. The Glengarry Glen Ross movie and the Death of a Salesman play have done little to enhance the image of salespeople by depicting them as losers or con artists. I actually know people who won’t admit they sell for a living.
So what do you do for a living?
“I, well, you know, I’m a new development person. I mean, I’m a new business opportunity person…I mean I develop new business.”
As a start-up owner, you may feel it’s better to hire a sales expert so that you can tend to other matters, like product development.
But if you don’t learn about sales, you run the risk of either hiring lazy salespeople, or worst, con artists who will take advantage of your naïve. Either way, you could lose a lot of money, time and prestige.
I once knew a small publishing company owner who admittedly knew nothing about sales or marketing. He never held a sales meeting. Never cracked open a book about selling. His marketing campaigns were from the Dark Ages. Instead, he hired a saleswoman who literally sat by the phone all day waiting for it to ring. She spent her three-year tenure at the company reading books. When a prospect did contact her, she went through the motions of qualifying him, scheduling a short demo, and offering a trial. Sometimes she would follow-up and sometimes she didn’t. With a large base salary, she had no incentive to work hard. Then one day, she quit. A more proactive and assertive salesman was hired. He ended up generating more new sales in 4 or 5 months than the previous saleswoman did in an entire year.
Why? Because he made cold and warm calls. Because he followed-up. Because a true salesperson can’t live on his base salary. In short, he knew how to sell.
The owner, realizing his mistake, now regretted not hiring a more proactive salesperson in the first place. All those potential sales slipped through his fingers because he didn’t take the time to understand the sales process and hire the right salesperson.
On the other hand, I knew another owner who not only took the time to understand sales but provided a small library of sales, marketing and business books for his sales team to read. He even watched videos about not only how to sell, but how to hire good salespeople.
But let’s say you are an extremely busy start-up owner and have little time to read about selling. Have no fear.
I would like to suggest two books you should read to get you quickly up to speed –
The Big Book of Sales, by Alan Gordon
The Ultimate Sales Machine: Turbocharge Your Business with Relentless Focus on 12 Key Strategies, by Chet Holmes
If you are ambitious and want to read more, HubSpot has created a list of the 20 Most Highly-Rated Sales Books of All Time.
Also, there are several excellent YouTube videos about selling that you can also watch.
And BTW, I know there is a lot of debate about which is the best sales process. Is it The Challenger Sale: Taking Control of the Customer Conversation, by Matthew Dixon and Brent Adamson, or could it be SPIN Selling, by Neil Rackman? Maybe you believe in Relationship Selling: The eight competencies of top sales producers, by Jim Cathcart.
Look, all three are good books. Read them. Consider their arguments. But at the end of the day, you will have to decide which sales process really works best for your sales team and your company.
5). Should you create a Quota system? As a start-up company, I wouldn’t worry too much about setting quotas for the one or two salespeople you have on staff. In the beginning, you are going to spend most of your time testing the market and seeing who is actually is buying your product or service – if, in fact, there is a real market. Sure, you can guess. Create a client profile of who you think will be a good customer. You can make some cold calls, send out some emails, and maybe send out some direct marketing pieces. But I would avoid creating any hard quotas for sales until you have a better feel of your market.
Rather than creating sales quotas, you may consider doing activity quotas. Activity quotas are when you expect salespeople to make x-number of phone calls per week or schedule x-number of demos or trials per week. On paper, this sounds like a great idea. However, be carefully that you are not forcing salespeople to do a lot of “make or busy work” – you want them to focus on selling, not dialing for bogus dollars.
6). Should you carve up and create sales territories? If you had three or more salespeople, my answer would be yes. But if you only have two salespeople, and the entire country (if not the world) to cover, I would say no. However, as your sales team grows, in order to avoid duplication and hard feelings, setting up sales territories by geography or market segmentation may not be a bad idea.
Some companies prefer using the Round Robin method of distributing leads – where inbound leads are dole out on a rotating basis among the sales team.
Experiment. See what works. But no matter how you distribute leads, always focus on the end game – obtaining sales.
7). Should you use a Customer Relationship Management (CRM) tool? My answer is yes. Using Excel spreadsheets or Post-it Notes isn’t going to cut it for you. While Salesforce.com is considered the dominant CRM in the market, as a start-up, you may not afford to purchase it. There are other CRMs that do cater to start-ups and small businesses for free or at a reasonable price, including –
To get a full listing of CRMs and obtain independent reviews, please check out Capterra, a Northern Virginia based company that helps businesses and nonprofit organizations find software. Not only does Capterra provide reviews, but you also receive product details, deployment, vendor contact information, and features checklist. You can even request a free consultation with a Capterra customer service rep to find the right match for you. They also publish interesting blogs and infographics that you can download.
My final advice is this – buy the best CRM you can afford. In the long run, a good CRM will save your sales team a lot of time and money. Take your time. Do your research. I recommend that you consider at least three CRMs before making a final buying decision. You may want to contact other start-up owners and compare notes with them.
8). Are the Yellow Pages a good source of sales leads? Unless you’re living in the 1980s, my answer is No. As a start-up, you are probably on a tight budget. However, there are several inexpensive or free lead generation sources you can use including –
Data.com (formerly Jigsaw)
Industry newsletters and blogs
List of clients from your competitor’s website (yes, I know this is sneaky, but if your competitors are going to publish their clients, you might as well call them. Who knows, some of them may be upset with their existing vendor).
RedJester created a list of 23 lead generation tools you may want to consider.
Also, check out Neha Jewalikar’s article on the “7 Must-Have Lead Generation Tools for Marketers” in Radius.
As you grow, don’t forget to take advantage of inbound phone calls or emails, referrals, and trade shows.
No lead generation tool is perfect. You will always have bad contact information. When I receive a new lead, one of the first things I do is check the contact on LinkedIn. While not everyone keeps their LinkedIn profile up-to-date, it’s usually a good way to verify if you have a good lead.
9). What are your expectations? You really need to keep your expectations within reason. For example, in most cases, it takes a good salesperson at least three months to build a pipeline from scratch – that means straight cold calling with no referrals or no inbound leads. And even if a salesperson is lucky enough to receive some inbound leads from your website or word of mouth, converting that lead into a customer can take weeks or months. I’ve worked at sales jobs where the sales cycle can last anywhere from a few months to two years. I know of some salespeople who spent five years closing a sale.
It really depends on what you are selling and the type of industry you are in.
And when it comes to cold calling, it’s not unusual to make at least 6 to 8 attempts before you reach the decision-maker. I know some salespeople who have told me it will take them at least 12 attempts before they reach the key person at a company or organization.
And yes, there are ways you can help shorten the sales cycle, like providing good CRM, generating good qualified sales leads, and offering great marketing solutions. Remember – your salespeople are serving on the front lines. Like any good soldier, they need your support.
10). Are Salespeople miracle workers? Do you still believe in the tooth fairy? If your product or service is crap, the best salespeople in the world aren’t going to help you. While it’s expected that any new product or service will be shaky during the first couple of years, if what you are offering is completely bad, salespeople are not going to save you. Sure, they may use hard sell or strong-arm tactics in the beginning to generate sales, but in the long run, you are going to fall flat on your face. Selling is a team effort – the product, development, shipping, marketing, and administrative teams all have to work together with the sales team to ensure success. In today’s economy, and this is especially true for a start-up, all employees are salespeople.
Selling is tough. But for a start-up, it’s even more difficult because you are facing several obstacles – tight cash flow, little brand or no name recognition, shoestring budget, and an ever-evolving change of plans or directions. You have to be agile, smart and focused.
You have to face the fact that some salespeople you hire won’t cut it or just don’t like working for a start-up. It’s nothing personal. It happens to the best of us.
When it comes to hiring salespeople for a start-up, you need to be brutally honest. If the hours are long, tell them. If the compensation package is low, tell them. If your resources are limited, tell them.
But also tell them this – that you worked your ass off for months, if not years, to create a product or service that will benefit thousands of people. That you truly believe in what you are doing is not a pipe dream. That you really believe your product or service could change the world for the better. That you are committed to improving your company. And if they hang on, the ride will get rough, but the rewards may be great.
Note: If you like this post, please check out my book – Advice for New Salespeople: Tips to Help your Sales Career for more help.