How Do I Grow My Small Business?
Maybe you are in the camp of “it will never happen to me” or maybe you are on the other side at “I’ll just work harder” or maybe you are just stumped. Sooner or later it will happen to every business owner. Your sales have flat lined. You have stopped growing and no matter what you try, nothing seems to work. You’ve tried increasing the money spent Facebook and Twitter and get no response. Even newly designed ads bring similar dismal results.
Then you brought in a “marketing” company and let them run a campaign. They came up with a theme, some pretty colors, and lots of nice, clean ads that appeared on all sorts of web sites, industry magazines, even the newspapers. Maybe they convinced you to put up a giant advertisement on some billboards around town. And what did you get for the cost? Zip, zilch, nothing but flat sales month after month.
There is a saying in business. If you aren’t growing, you’re dying. Flat sales will crush you because of everything else going up in price.
What Did the Old Timers Do?
Way back in the dinosaur days when Og wanted to sell his spear points, even he knew when the market was saturated and everyone had a couple of good sharp spears on hand, he had to try different things. I’ll bet he tried 2 spear points for a fish dinner. Maybe he would include the wooden handle with the points attached if you had the fish and a few shiny rocks for Mrs. Og to wear.
At some point those ideas fall flat, especially in a competitive, saturated market. The thing that kept getting Og mad was the amount of time he had to spend on marketing and sales. This really hurt his ability to chip away at making new spear points.
A Stroke of Brilliance!
Then one day our old friend Og was talking to his friend Grog about his dilemma. “That’s some bad problem you have there, Og,” said Grog. “Here’s an idea, why don’t you let me try and sell the spear points for you? You know how much I like to talk.” He was correct about that, thought Og. Old Grog sometimes just wouldn’t shut up.
This is where Og must have fallen off of the rock he was sitting on! “Why didn’t I think of that,” he thought. “Grog, my friend, you can sell all of the spear points you want and we’ll split the profits!” And so the concept of a sales person was born. I know it happened exactly like that as I am a friend of Og and Grog and witnessed it firsthand.
The Nitty Gritty
Sooner or later, a professional sales person, man or woman, will be required for every business in existence. Look around your office right now. Everything you can see and touch was handled by a sales person, perhaps several, until it ended up right there next to you.
With their training, experience, and selling skills, you should see an increase in new orders and an uptick from existing customers. The time it takes to realize the new business coming in the door will depend on a few things.
First, how familiar is the sales person with your product lines and industry? Obviously if they are from a similar industry, such as a competitor, they should be able to step right into action but if they are crossing into a new industry, say from a car dealer into security cameras, you should expect a delay until they get up to speed.
Second, you may have to invest in training. No, you absolutely will have to invest in training – product, procedure, processes, and a few others no matter where the sales person came from. Have you thought of a budget for this? Do you have space for training to occur? Will they have an office and access to your products? Most importantly, who will be giving them the training, you or someone else?
The Owner Problem
As the small business owner you might have some very odd feelings about this move. You might be thinking “what if they embarrass the company” or “I hope they are honest with my customers.” A thousand other negative thoughts might spend some time floating around your mind. But you know, deep in your heart, the time has come. It’s time to let go and let a professional sales person go to work for you.
Your job is to motivate them with adequate compensation, support, training, and anything else they ask for, if it will help them sell. Then get out of the way. Let them go. You aren’t their parent, so if you’ve hired well, motivated them well with great compensation and a support system, then go back to making your product the best it can be.
Where to Start?
Where do you start this process? It should be obvious that a hiring mistake here can be very costly. Even to the point of much lower sales if the new sales representative hire is a fraud or crook who promises anything and everything to make a sale. When a customer gets stung by a horrible experience it might take you years before they will even talk to you again.
It happens. Not too often, thank goodness, but if you hire a dozen people to sell for you, you can expect one or two will not be honest with you or your customers. Consider it a cost of doing business. You just don’t want the first one to be the bad apple. Start the process and hopefully get better hires by first committing to using an angel investor who is versed in hiring sales people, specifically. Yes, it is something I have particular experience in but there are many other investors out there who can design a compensation plan, seek, select, interview, work with and assist in the evaluation of the sales rep. The investor, also called a consultant, can even ride with the sales rep and observe their behavior in front of customers.
I am not referring to a headhunter or job board. Remember, they will get paid if you hire anyone they recommend no matter how bad the applicant. Neither of these can understand what you want like an outside investor can. The investor’s job isn’t to just run people through you for interviews but to understand your needs at the size of your business today and design a strategy to select the top candidate for your current situation.
As you grow the business, the type and experience level of a sales rep that your business needs will change over time. A new company can’t offer the best sales rep in the industry very much in way of income, benefits and so forth like a very large company can. So you have to be selective and hire correctly. The wrong hire will leave if they feel they don't have the proper backing from the company. That's where the investor can give you a strong hand. We can pre-interview the candidates and present the very best selection to you for your final interview. The investor will have your best interest at heart.
For this to be successful, you need to bring in the investor first, before you begin. They have to understand your business processes, current customer environment, and work with you to create a compensation plan appropriate for your industry. Then, and only then, will the investor build a strategy to find the right candidate.
All of this will take time and money. But when you put a star on the payroll and your business starts to take off like a jet fighter, I think you will be pretty happy. The next problem might be too many sales. Maybe you won’t be able to keep up!
That’s a problem we all want to have. Don’t waste time with a DIY hire. Use an Angel!
Tidewater Capital Services is an international private investment firm based in Charlotte, North Carolina. We believe that the true economic value of every asset is realized over the long term. Often that means holding an investment for years. To capture the true economic value, we seek to invest our own capital where there is a high-growth potential business, run by intelligent, trustworthy founders. Our capital, along with our many decades of experience, will often be the difference between success and failure. We encourage you to review our equity investment criteria page for more information.
Lee West - Founder & C.E.O.,
Tidewater Capital Services.
My name is Lee West. I help people develop their businesses into industry leaders so they can achieve their dreams. Thank you for reading.