September, 2008

Now is an Ideal Time to Prospect for New business

Four proven strategies to put to work today.

By Bill Lee

In each of the Contractor Sales Skills seminars I have conducted in 2008, the audience agreed that the number one key to customer loyalty is how solid the salesperson’s relationship is with the contractor. Yes, it’s almost always relationship that separates the loyal customer from the reluctant prospect.

In many communities, our industry is in a state of flux. Many lumber companies are downsizing while others are struggling to stay afloat. But one thing is for sure, when a contractor loses the salesperson who has been servicing him for a long while, that contractor is looking for a new relationship. This is the reason NOW is such an ideal time to prospect for new business.

Caution
It’s almost always a big mistake to try to develop a relationship with too many contractors. I believe salespeople who allow a slow housing market to induce panic will begin looking for an order under every rock they come across. This kind of reaction dilutes the salesperson’s energy and effort. Instead, I recommend that salespeople spend some quality time doing enough homework to allow them to handpick qualified prospects who meet their ideal customer profile.

Four Proven Prospecting Ideas
1. Ask for referrals. All salespeople have loyal customers who know fellow builders who are either unhappy with their current supplier salesperson or else they have lost the salesperson who has been servicing their account. Now is the time to pop the magic question to your loyal customers: “One of my goals for 2008 is to grow my customer base, do you have any friends who would benefit from the same level of service I provide you?”

Ask this question often enough and the odds are that you’ll identify a group of qualified prospects to begin calling on and building a relationship.

2. Identify contractors who have lost their salesperson. I have a client whose largest competitor went out of business. Upon hearing this news, the owner immediately began contacting several of this competitor’s salespeople. He ended up hiring two of the former competitor’s very best salespeople and quickly debriefed them. Within a day, he had a list of creditworthy contractors who had recently lost their salesperson.

“I hate to see anyone go broke,” my client told me, “but I saw this as a golden opportunity to build my customer base. It was like shooting birds over a baited field. Already we’ve picked up six new customers representing over $2 million in sales.”

3. Begin a direct marketing campaign. There are several types of effective direct marketing programs to choose from:
– Direct Mail
– Telephone Calls
– E-mail Marketing
Lumberyards that sell contractors must take advantage of business-tobusiness marketing tactics and direct mail is one of them. But to get started management must appoint someone in the organization to put together an upto- date list of mailing addresses, telephone numbers and email addresses.

On a consistent basis, say, monthly, make sure that each of the qualified contractors in your trade area receives informative mailings and or telephone calls that they will perceive to be valuable. It has been my experience that the definition of valuable is information that will help these contractors make more money or help them solve their most pressing business problems.

4. Hire a residential construction expert to present a short program to your customers and prospects on how to prosper in tough times. This small investment will make your company look like a hero to builders who are looking for answers. There’s still business out there. The most aggressive suppliers are busy taking proactive steps to get their share.

BILL LEE has nearly 40 years of experience in the construction supply industry. A consultant and seminar leader, he is the author of two books: Gross Margin and 30 Ways Managers Shoot Themselves in the Foot. www.BillLeeOnLine.com, 800.277.7888.