Mike Michalowicz's Blog, page 97
January 12, 2015
Episode 10: Profit And Sales Management With Sharon Marrell
Instrumental Teacher and Business Owner Sharon Marrell joins Episode 10 of the Profit First Podcast. Sharon shares how to improve inventory sales in your retail space.
Our Guest
Sharon Marrell is the owner of Marrell Instrument Repair LLC in Lakewood OH. She has taught instrumental lessons for over 35 years and repairs musical instruments. She speaks at conferences providing band directors with tips and techniques on instrument repair.
Sharon is the Lakewood Chamber of Commerce 2014 Outstanding New Member and chairs the Education Committee providing workshops for local business owners.
Sharon is also Certified Profit First Professional Coach.
Show Quotes
Having a small retail space helps limit what you put out on the sales floor, and prevents going overboard on purchasing.
Buying for the customer, knowing what they want – that’s what you should have in stock. Don’t stock up for that one person that comes in twice a year, or buy items because it’s what you like.
When you have too much inventory and too much set on the shelves for a long period of time, it weighs you down. Get rid of the stagment inventory through creative sales or take the loss – just get it out of there. Even selling an item online is a quick way to get some income in. Then replenish with what the customers want.
When working in close quarters with your competitor, it helps to reach out to the community. Pay attention to the customers that your competition is not. Offer faster service with quality.
Show Links
Sharon’s Website: www.marrellinstrumentrepair.net
Show Sponsors
Nextiva – VOIP phone providers for small businesses.
Fundera – Single source online funding for entrepreneurs. Also offers an adviser program for CPAs, bookkeepers and business coaches.
TSheets – The #1 customer rated time tracking solution!
The post Episode 10: Profit And Sales Management With Sharon Marrell appeared first on Mike Michalowicz.
January 9, 2015
Empower Any Employee With 3 Questions
You can’t do it all by yourself. I don’t care how brilliant you are, at some point, if you want to scale up your business, you’re going to have to trust and empower your employees to make key decisions for you. It’s tough. I know it is, but it’s also necessary if you want your company to grow.
The reluctance to empower your staff can be the single factor that limits your growth if you don’t find a way to overcome that reluctance. Yes, mistakes will happen. (Here’s a hint, though – you make mistakes too!) At some point, you’re going to have to take a deep breath, implement fail-safes that mitigate your risk, and you’re going to have to trust your employees to make decisions.
It’s important, though, that you give your staff a process for making good decisions because the choices your staff makes will affect both your company and, by extension, their job security. Good decision making isn’t necessarily intuitive, and if you want your company to thrive, you have to prepare your staff for their roles as corporate decision makers. You have to teach them the steps they’re to follow in determining if any given project should get the thumbs up. I’ve found that the best way to help guide your employees is to teach them to ask these three questions:
1. Does this decision further distinguish our company’s uniqueness? I’ve gotten some strange looks when I’ve explained this first question, but there’s a reason that it’s so important. Your company’s uniqueness is your edge. If you water it down, you become invisible to prospects, and that’s fatal. Now in order for your employees to be able to answer this question, you must first ensure that every single member of your company understands your competitive edge – what makes you different from every other company in the world. Only then can you trust your staff to make decisions that preserve or promote your uniqueness. If your employees can’t answer yes to this question, then they have to stop. They can’t proceed any further unless and until they can rework the decision so that it does, in fact, further distinguish your company’s uniqueness.
2. Does this decision further serve our best clients? I’ve seen it happen far too many times – a company does something really well, and in the struggle to grow bigger, loses sight of the reasons why customers flocked to them in the first place. Customers = revenue. We can’t ever, ever forget that key fact. We must always keep our focus on retaining our best customers while attracting new ones. If your employee can’t answer yes to this question, again – they’re stuck until they can.
3. Does this decision maintain or enhance profitability? It’s pretty simple: if you’re losing money, you won’t last. Every single decision needs to be able to pass the profitability test, or it’s dead in the water. If a decision doesn’t make fiscal sense, then it needs to be reworked until it does.
These three questions get at the core of your business’ best interests. If your staff carefully, thoughtfully considers your company’s uniqueness, its best customers, and its profitability with every single decision they make, then your business is in good hands. If you train your staff (and by the way – bonus – you’re training yourself as well) to make reasoned, sound decisions, then you’re free to move on and work on other aspects of your business.
Another important aspect of this process — training your employees to move through these three questions – is how you handle decisions when the answer to one or more of the questions is no. Great opportunities don’t just fall into our laps. Fortune favors the bold, and sometimes we have to put in some effort to shape an opportunity to become a better one.
If you’ve given your staff the authority to make decisions and you’ve given them to tools to make those decisions good ones, then you’ve also got to trust them to be able to reframe or rework their ideas to make them good for your company. When you have staff who knows that their judgment and input is valuable to you, then they’ll feel some of the pride of ownership that you do as well.
And that’s exactly what you want in a decision maker.
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January 8, 2015
7 Steps To Get Your Company Acquired For Big Bucks
I’ve sold two companies, and the sales were vastly different experiences, with wildly different results. When I was approached about the sale of my first company, I wasn’t looking to sell. I loved what I was doing, and the company was very attractive to the person who ended up purchasing it. I made big bucks off that first deal.
Fast forward a few years to the sale of my second company. My partner and I were very motivated to sell. We were actively soliciting investors, and what turned out to be a very long process was ultimately not very profitable for us. We didn’t make as much as we’d hoped to.
The lesson: Desperation isn’t attractive. If and when I ever sell another company, I’ll be much better prepared to maximize my profitability by following these steps:
1. Realize what acquirers are looking for. People buy companies for a number of different reasons, and if you can figure out what your buyer wants, you can position yourself to your advantage. Some purchases are strategic acquisitions – your office cleaning company (with its client list and equipment) is attractive to a home cleaning business looking to expand. Other purchases are defensive – your company is the chief competition, and buy purchasing you, your competitor is poised to dominate the marketplace. Other purchases are simply to generate revenue – allowing the buyer to streamline processes and cut costs by consolidating. Find out what your buyer wants.
2. Know that it’s a long process. My first sale – the most profitable one – took two months. I blinked and it was over, but that’s most definitely not the norm. My second sale took eight long months (that felt like eight years.) A process that long can put your business in serious trouble if you concentrate all your energy on pushing the sale through, rather than maintaining and growing your company. Sales do occasionally fall through, and it’s essential that you have an exit strategy – a plan B in the event that you can’t make the sale.
3. Get as many bidders involved as possible. Ever been to an auction and seen people get so involved in the thrill of bidding that they end up blowing their budget just to win the contest? Bidding (and buying) is an emotional process, and you can use that drive to win to your advantage.
4. Get an investment banker or a business broker to handle the sale with you. Your business is your baby. You’re emotionally wrapped up in it, and since you’re going to be working to keep that business profitable during the process of the sale, you need someone who’s more detached to keep an eye on the maximum return. A banker or broker will get you a premium price and let you keep the business alive.
5. Profitability is key. Lots of things go into establishing the value of a business – innovation, intellectual property, client base – but by far the most important element is the proven profitability of your company over time. You want a steady, strong history of making money. Minimize unnecessary expenditures and maximize your company’s profitability, and you’re improving your chances of selling for big bucks.
6. The riches are in the niches. If you’re providing a unique service to a dedicated, loyal group of satisfied customers, you’re poised to cash in big. It’s much harder for a bigger business to swallow you up on the cheap if you’re thriving in a niche market.
7. Make yourself dispensable. If you can subtract your ego and your involvement from your business, you’re adding to its value. Your business is much more valuable if it can run without you. Start scheduling and taking vacations and force your business to flourish on its own, demonstrating that the company will continue to thrive even after you no longer own it.
So here’s the secret to all of these steps: these are all things you should be doing anyway – things that make your company more efficient and profitable whether you plan to sell it or not. Your goal in prepping for the sale of your company should be to whip it into the best shape you can in order to boost its value. What you don’t want is to spend months trying to push for a sale and watch your business wither from neglect, only to have the sale fall through and leave you with a worthless business. Your best bet is to continue to grow your business, right up until the day you get that big check and hand over the keys.
The post 7 Steps To Get Your Company Acquired For Big Bucks appeared first on Mike Michalowicz.
January 7, 2015
Find Great Talent With These 10 Interview Questions
While folks seeking employment may spend hours prepping for their interviews, the failure to adequately prepare typically comes on the end of the person asking the questions. Your staff can be your greatest strength or your greatest liability, and we owe it to ourselves and our businesses to take the time to find the most talented employees who are also a good fit for our business model.
Prospective employees prepare canned responses to the questions they think you’ll ask. Their goal is to make themselves look good – to amplify their strengths and minimize their weaknesses. Your goal should be to set up a discussion that reveals patterns in their behavior and predicts how they’ll fare in your company. Past behavior predicts future behavior. Set yourself up to collect some honest, thoughtful responses that will give you a better idea of how each candidate will actually perform.
1. What is your purpose in life? Most people haven’t thought about this question, and if they haven’t, then they’re far more likely to be working solely for the money, and you will know that they’re more likely to jump ship for a chance at more money. Since staff turnover is so expensive (in terms of both time and money,) one of your primary goals should be to define which candidates have long-term potential.
2. How do you make decisions? What you’re looking for in this instance is thought patterns. Ask your candidates to take you through their decision making process, and then ask them for examples of decisions they’ve made. Check to see if their real-life decisions are made by employing their process. You’re looking for consistency between what your applicants say and what they do.
3. Show me how… Ask your applicant to demonstrate one or two of the tasks they’ll be performing for your business. How do you answer the phone? How would you try to sell me this product? How would you edit this document? How would you handle this programming need? Even though the candidate may feel self-conscious, you will gain valuable insight into the ways they perform.
4. How did you go about researching our company? This question lets you immediately differentiate between casual applicants and those who are authentically interested. A candidate who takes the time to learn about your company and its goals is serious.
5. Tell me something about me that you think is interesting. Following up on the previous question, you’re sifting out the applicants who haven’t bothered to learn about your company and the goals of its founder. You’re also putting the applicants on the spot and creating an opportunity to see how they think on their feet.
6. What have your past bosses been like? This question will give you an idea of how candidates relate to authority and will tell you how each candidate likes to be managed. Again, remember that what you’re looking for is patterns in behavior. The tale of one horrendous boss may not indicate trouble, but a litany of gripes about every supervisor indicates a potentially problematic relationship with authority.
7. What is your greatest fear about this position? The goal of this question is two-fold. First, you can weed out candidates who aren’t entirely honest. Any applicant who claims to have no fears isn’t being completely truthful. Second, you’ll be able to identify each candidate’s weaknesses (and they all have ‘em.) Identifying weaknesses gives you another measure of comparison among candidates, and it can even help you get your new staff member started off right by focusing on the areas about which they’ve expressed concern.
8. If money were no object, what would your ideal job be? Ideal candidates will be working in – or working toward – their ideal jobs. If the position you’re hiring for has no relationship to the ultimate goals of your applicants, then they’re unlikely to be dedicated, long-term employees. If, however, your job is a step toward what they want to be doing, then even though you may not keep them forever, you’ll get great results from those employees who will continue to work in your field.
9. Who are the biggest jerks you’ve had to deal with in life? The answers to this question reveal how your candidates see other people. It reveals how they label others and whether they accept responsibility or shift blame. What you’re looking for is how each candidate resolves the conflict that’s inevitably going to occur.
10. What parts of work drive you nuts? The question gives you another way to get at each applicant’s weaknesses. The parts of work that we find frustrating highlight our weaknesses and ways in which we struggle.
Keep in mind that it’s not necessarily a specific answer that qualifies or disqualifies any candidate from employment, but that you’re looking for the employee who will be the best fit for your company’s culture and goals. You’re looking to anticipate future performance and hire successful, long-term staff. With that goal in mind, I strongly advise hiring for every position on a test or trial basis. If after the trial period – say three months – you decide that the employee is a keeper, try this bonus tip: Invite them to leave with a $500 check in hand, or stay for a full-time position. The employee who takes the $500 check relieves you of the future expense of time and money that’s associated with further training, while the employee who rips up the check demonstrates the commitment to you and your company that indicates dedication and long-term success.
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January 6, 2015
How To Destroy Employee Loyalty
I had dinner a few nights ago with a friend who works for a Fortune 500 company. He’s been looking for another job for nearly two years now, and he told me that he’s been so unhappy – so mentally checked out – that he’s been doing the least amount of work that he possibly can while still going unnoticed. He’s basically dead weight, and he knows it. In his long list of valid complaints about his company, I realized that there’s a recipe for widespread employee dissatisfaction – the penny wise, pound foolish things that employers do without realizing that they’re driving their talented staff away.
If your goal is high turnover and saying goodbye to your best employees, then follow these guidelines:
Require 24/7 access. You – as the business founder and owner – may choose to eat, sleep, and breathe your business, but you’re crazy to think that your staff wants to live that way. We need rest and relaxation to perform our best, and requiring that your staff be on call and available around the clock will inevitably produce resentful employees. Give your employees time to recharge and enjoy their private lives.
Require your staff to do work they suck at. One of the biggest mistakes I’ve ever made was failing to assign the right duties to my employees. If you take the time to match your staff with responsibilities they’re good at, everyone will be happier. The quality of work your staff produces will be higher, and they’ll feel more competent. Pushing an employee in the name of stretching their talents isn’t necessarily in your best interests as an employer.
Refer to your staff as “human resources.” I kid you not, I just observed a meeting in which a manager lamented the fact that his company was “low on human inventory.” Nothing makes your staff feel unappreciated more than realizing that you think of them as a resource rather than as a human being. Your staff is composed of people, not raw materials. Treat them like human beings. Learn their names, and for God’s sake, don’t ever refer to them as “inventory.”
Expect your staff to make the company part of their social life. There should be something like the separation between church and state in the lives of your employees. Don’t overreach the bounds of your business by expecting to see Facebook updates revolving around your company on your staff’s personal pages. Not only do they have a right to their private lives, but you also don’t want the hassles of inappropriate posts that involve your business.
Blame the rules. If you’re using the rules to cover for your inflexibility in work situations, then you’re missing out on one of the chief benefits of being the boss. You get to make – and change – the rules! If you’re privileging the employee manual over the employee, then you need to reexamine your priorities. Evaluate the situation and make good decisions rather than blindly following rules that may not be in your company’s best interest.
Ask for input and ignore it. If you’re going to solicit or require input from your staff, then you owe it to them to consider that input. While you may not implement all of their suggestions, it’s important to let your staff know that you value their insight and perspective.
Focus on money as the primary motivator. Money is the least effective and most expensive motivator when it comes to employee retention. If you’re simply shoving money at your staff – money that they use to fund their personal pursuits, you’re missing an opportunity. Focus on finding challenges that yield fulfillment and a sense of purpose. You’ll find that these abstract factors are actually more important in retaining employees than you thought.
Put your company ahead of your staff. If you’re focused on the bottom line rather than the people who help you bring in revenue, then you’re likely to watch those people walk out the door. Support your staff. Protect them, and they’ll reward you with long-term loyalty. You’ll eventually realize that protecting your staff is also taking care of your bottom line.
Attracting and retaining great employees is perhaps the single most important challenge you face in building a healthy business, and your decisions have a huge impact on your profitability. Quibbling over the cost of a ream of paper is small potatoes compared to the impact that a dissatisfied employee can have on your client relations. You want your customers to trust you with their business, and one of the best ways to demonstrate your trustworthiness is by creating a climate in which your staff knows their value to you and feels like a part of a team.
Disgruntled employees can hurt your business, whether they’re actively sabotaging your company or merely presenting a lousy attitude in their dealings with clients and fellow staff members. Investing in your staff and their satisfaction is one of the most profitable decisions you can make.
The post How To Destroy Employee Loyalty appeared first on Mike Michalowicz.
January 5, 2015
Episode 9: Employee Engagement And Profit Strategies With Robb Braun
Public Speaker, Corporate Trainer and Leadership Coach, Robb Braun, joins Episode 9 of the Profit First Podcast. Robb explains the importance of having a motivational work environment and how to get your employees engaged.
Our Guest
(Mike Michalowicz & Robb Braun)
Robb Braun is an accomplished Public Speaker, Corporate Trainer and Leadership Coach on a mission to empower business leaders to create work environments that foster employee greatness – motivation, loyalty, productivity, initiative and drive. He works with progressive, energetic companies who want to stay relevant, and helps them to transform from surviving to thriving. Robb is the Founder and President of The Leadership Source, and is a Profit First Strategist who brings over 25 years experience. Throughout his career he has touched the lives of over 50,000 participants in his personal growth and corporate trainings throughout the world, primarily in the realm of leadership success. There is no metaphoric place Robb is unwilling to travel to ensure his audiences and clients experience and achieve ‘unreasonable’ success in their personal and professional development.
Show Quotes
Increasing employee engagement ultimately translates into more bottom-line dollars.
In corporations, 3 out of 10 people are fully on board and engaged, meaning they’re aware of the mission and why they’re there; all of their energy is in the project. 5 out of 10 people are sleepwalking – they haven’t decided yet and are just showing up. 2 out of 10 people are actually working against forward movement.
It does not matter if you have 1,000 employees or 5 employees, it’s all handled the same.
The number one complaint from employees is that they don’t get enough information about where we are (as an organization) and where we’re going.
In reference to Robb’s friend, Grant Cardone: Money is important. If we’re talking about business, we’re talking about money. we’re not going to demonize it but we’re going to give it it’s due. It’s important, we need to talk about it. It’s about the profit. It’s important to talk about it in an organization – let that be an understanding that this is how we measure how we do in business.
Having a legitimate strategy around profit has freed me up in so many ways. Not knowing sucks and hurts business. Knowing is power.
Show Links
Show Sponsors
Nextiva – VOIP phone providers for small businesses.
Fundera – Single source online funding for entrepreneurs. Also offers an adviser program for CPAs, bookkeepers and business coaches.
TSheets – The #1 customer rated time tracking solution!
The post Episode 9: Employee Engagement And Profit Strategies With Robb Braun appeared first on Mike Michalowicz.
January 2, 2015
6 Big Mistakes To Avoid When Buying A Business
Have you considered the possibility of purchasing a business? If so, there is a good chance that you may make one of the many mistakes that are common in people purchasing pre-existing businesses. But it doesn’t have to be that way; you can take steps to avoid these problems. The more you know what the frequent errors are, the more you can work to avoid them.
Pitfall Avoidance
Buying a business can be your worst nightmare, or it can be the greatest move you ever made. But a lot of what determines which it will turn out to be occurs prior to the transaction actually taking place. Like most situations, the more homework you do when considering the purchase of a particular business, the better off you will be if it comes down to making the actual purchase.
Here are six of the biggest mistakes that people make when buying a business:
1. Due diligence failure. Businesses that are for sale need to paint the most promising picture they can. Why else would you buy? It’s kind of like realtors working with homeowners to stage the home when they put it on the market. The business owners may try to make the business look amazing, but you shouldn’t take it at face value. You have to follow up and investigate, to ensure that what they say is accurate.
2. Thinking that culture doesn’t matter. Take a frozen mug and pour hot water on it. What happens? It cracks! It is the same thing with business cultures. Buying a small business that runs like a family and putting it into a corporation that runs like, well, like a corporation, and it will most likely crack. You have to take the company culture into consideration, and determine if it will be the same once you, or your team, enter the picture.
3. Merging too fast. Change that takes place at a slow but constant pace will work much better than change that happens too quickly. When change happens fast, there are often too many breaks and problems that arise as a result. Taking over a business is a major decision, one that you certainly don’t need to rush. Aim for a slow, smooth transition to get the best results.
4. Leaders don’t participate. To be a good leader, you have to be there, participating on a routine basis. The leadership of the acquiring company needs to participate, not just beforehand, but also after the deal is done. It is imperative that they show their faces and do their job, which is to lead!
5. Knowing the org chart, but not the social chart. Every company has an organization based on title, but there are is something more power than titles – the social influencers in the business. Those who acquire a business need to find out who those people are. Susan the receptionist, who brings in treats from home every day and is loved by every employee, can actually be more important than the CEO. And the acquirer needs to know this!
6. Not negotiating properly. Let’s face it – a lot of people are not so good at negotiating. If someone wants to sell their business, you have the upper hand and should use it to your advantage, negotiating terms that are more comfortable for you. If you are someone who has a difficult time playing hard-ball, then bring in someone to do the negotiating for you. Believe me, they will be well worth the expense, making up for it in what they can save you, over time.
Ready to Roll
Only once you have done your homework are you ready to actually buy a business. This is one sale that simply cannot fall into the “impulse purchase” category. It has to be something you have fully investigated, believe in, know all about, and are confident and comfortable stepping up to take over.
The post 6 Big Mistakes To Avoid When Buying A Business appeared first on Mike Michalowicz.
January 1, 2015
Marketing: 6 Reasons Why Reverse Psychology Works
In 1961, William McGuire developed a theory that he called the Inoculation Effect. He used the theory – based on the medical practice of inoculating patients to confer disease resistance – to describe the process by which we can become resistant to attempts to persuade us. It turns out that we develop resistance by being forewarned, or educated, about future attempts to persuade us. There’s ample evidence to support the theory, most notably a study of a group of children who were educated about cigarette companies’ attempts to persuade these students to start smoking – once they come of age, of course. This early education not only resulted in higher resistance to the appeal of smoking at one and two year follow-ups, but the study showed long-lasting results as well.
What does this have to do with growing a business? It means that you have to work harder to attract customers, and you may have to take a novel approach, given the fact that consumers have been assaulted by tactics like the Home Shopping Network’s countdowns – “Only three minutes left…..operators are standing by” – and consumers are more savvy and more skeptical of the attempts to manipulate their behavior.
What’s the answer? It’s absolutely revolutionary, and it’s completely contrary to what consumers expect – it’s a bit of reverse psychology, in that you’re giving folks something different. You tell the truth. Just when your prospect is expecting to be worked over, you are completely honest, and you will be shocked at the results.
Let’s take a look at some techniques in which honesty is your ticket to closing sales.
1. Use the Inoculation Effect to your advantage. When you know that your prospect is making a choice between you and your competitor, share the information you have about your competitor’s sales tactics. If you alert the prospect to the fact that “some businesses” will price their wares deceptively or will try a little bait and switch, then you’re instantly decreasing the effectiveness of those tactics on your prospects. Remember – being honest is paramount. Don’t make things up or exaggerate.
2. Explain how you’re different from the rest of the industry. Related to #1, this technique inoculates your prospect against the industry standard. This technique is brilliant if you have a point of difference from all the other guys. If you’re a caterer, maybe everyone else tacks on outrageous charges for china and flatware rental, but you’ve found that it’s always cheaper for your clients to arrange those items themselves. You’re priming them to object to those charges in other caterers’ quotes, and you’ve set yourself apart from the crowd.
3. Don’t offer more; offer less. A la carte ordering – regardless of the industry – is the new standard, and consumers are flooded with a mind-boggling array of choices. They’re used to being told that more choices are always better. Here’s the inside scoop, though: studies have repeatedly shown that too many choices can result in analysis paralysis – customers frozen into indecision by too many choices. Customers want to feel like they’re in control…but only to a certain point. Your best bet is to always offer exactly three choices. You’re the expert; use your knowledge to present your client with three good choices, rather than trying to dazzle them with everything you can do, regardless of whether it’s right for them. Buck the trend.
4. Give prospects an easy out. We’re all so used to high-pressure sales techniques, that we’re positively refreshed when that pressure doesn’t materialize. If you make your pitch, try ending by telling the prospect that you understand if they think your product isn’t a fit for them. Evidence shows that your close rate stays about the same, but here’s the really powerful part: Your clients’ confidence increases, and you eliminate buyer’s remorse. If they make the decision based on their preference, rather than because of undue pressure, then they’re happy with their choice. They don’t expect you to favor their confidence over your sale.
5. Disqualify your client. This technique can be tricky because it only works when you’re being honest, and the reason I know is because it worked on me. When my wife and I were bed shopping years ago, the sales person saw us – a young couple – and walked us past the pricy Tempurpedic beds to the ones she thought we could afford. When I asked about the ones we’d passed by, she told me that we couldn’t afford those and she was prepared to show me ones in my price range. Of course, I had to prove her wrong, and we walked out after having bought the Tempurpedic bed. Presenting your clients with affordable options and dangling the deluxe versions as just outside their price range can trigger a willingness to spend more. Remember, though, the goal isn’t to manipulate – you don’t want to push your clients to make bad decisions. The better bet is to persuade – give them the opportunity to make the decisions that will make them happy and give them what they really want.
6. Use the 1-10 rating system – with a twist! One typical sales technique asks a prospect to rate his attitude toward your product after you’ve made your pitch. The prospect will respond with a number – say 6 or 7 – and your job as a sales person is to persuade them higher. What I’ve found to be effective is to use a little reverse psychology – tell them you’re surprised, that you thought they’d be at a 3 or 4. The magic is what happens next. Your prospect starts explaining to you why their number was higher – in effect selling you on the virtues of your product. The next thing you know, they’re at a 9, and you’re closing the sale.
The marketing landscape is crowded, and prospects are increasingly jaded by the clamoring of sales people and special offers. Folks crave authenticity and honesty, and if you can do the opposite of what’s expected by being forthright, you’ll end up way ahead.
The post Marketing: 6 Reasons Why Reverse Psychology Works appeared first on Mike Michalowicz.
December 31, 2014
9 Ways To Get Your Team To Support An Idea They Hate
We’ve all been there – you’re introducing a new initiative or making a change in your company, and you know that your staff’s not going to be thrilled. Sure, you’re the boss, and what you say goes, but you know in the long run that you’ll be better off if your team is on your side.
If your staff doesn’t understand or support your ideas, it can cause big problems – from subconscious behaviors that undermine your chances of success to – worst case – deliberate sabotage. It’s worth taking the time to get your team united behind your decision … and here’s how to do it:
1. Give them ownership. People like their own ideas better than other people’s. So what do you do? You give them ownership of the ideas you want to implement. Hold a meeting and present your thoughts on the situation you plan to address. Guide the discussion so that it goes in the direction you’ve already decided is right, and let your staff make their own journey to arrive at the same conclusions you have. Taking them through your process helps your staff understand why your idea is a good one, and they understand the reasons behind it as well.
2. Use the power of writing. When the signers of the Declaration of Independence put their John Hancocks on the famous document, they were making their position, their allegiance, and their intentions clear and public. Similarly, if you draft a plan and get your staff to sign it to indicate their understanding and commitment to your idea, they’re publicly, indelibly on the record as being on board. Employees who publicly commit to seeing your plan through will be more likely to work for that plan’s success.
3. Communication is key. It is always, always to your benefit to cultivate an open and honest exchange of ideas and information in your office, and the success of your new initiatives can often live or die based on how well you and your staff communicate. Keep your door open and solicit feedback.
4. Give them an outlet to vent. If you’re encountering stiff resistance, sometimes your best bet is just to let your staff have a bitch session. Commit to listening and considering their objections, let them blow off steam, and then get them on your side and put them to work.
5. Compromise. You’ve worked hard to assemble a staff of talented folks. Use them! If you’re convinced that your initiatives are divinely inspired and infallible, then you’re missing out on one of your greatest resources. Often the very best ideas are those that have been refined by compromise among multiple perspectives. Let your staff make you better.
6. Show progress. We like to feel like we’re making headway. Restaurants that have customer loyalty cards – you know, where you buy ten sandwiches and the eleventh one’s free – discovered long ago that customers whose cards are punched feel more motivated to come back and fill the card the rest of the way. Likewise, giving your staff updates on your measurable progress will keep them inspired to continue working hard toward your goal.
7. Reward publicly. Positive reinforcement is unbelievably powerful, and it works particularly well for the staff members who might not have been as enthusiastic about your idea initially. Single out one of the folks who was on the fence and point out how much they’ve accomplished and contributed to the cause.
8. Flip the conversation. If you have an employee or a partner who’s really opposed to your idea, it can be useful to flip the scripts. If each of you argues the other side of the issue, you might end up refining your idea based on benefits or drawbacks you might not have seen. You can refine your argument and your ideas by taking on another perspective.
9. Reevaluate. Sometimes your idea just stinks, and you need to step back and reconsider it. You’ve hired talented people, and you should avail yourself of their valuable insight. Being willing to admit when your idea isn’t stellar makes you stronger in the long run, and it can keep you from making disastrous decision that aren’t in your company’s best interest.
Enlisting the support, talents, and insight of your team can be the difference between an idea’s brilliant success or dismal failure. Taking the time to sell your staff on your idea and get them behind you is a step that ensures long term success.
The post 9 Ways To Get Your Team To Support An Idea They Hate appeared first on Mike Michalowicz.
December 30, 2014
How To Get In Front Of Any Decision Maker
One of the most important aspects of sales – whether you’re dealing with products or services – is getting in front of the decision maker. Most entrepreneurs have faced the situation of making a brilliant pitch, only to discover that all of their time and energy went into convincing the person who isn’t authorized to pull the trigger. None of us has the time to spin our wheels. When you need to make the sale, you have to get to the person in charge.
My mother always told me to ask for what I wanted, so when I faced the challenge of getting access to the decision maker, I figured that being straightforward was the best tactic. Wow, was I wrong! Decision makers are inundated with competing claims on their time and attention. They’re besieged by phone calls, emails, and even in-person visits – all of which have the same goal: to get a few minutes of time to make a pitch.
As a result, decision makers are better at saying no than you can possibly imagine. They’re masters at shutting people out and limiting access. They have to be.
Think it’s impossible to get the ear of a decision maker? It’s not, but the key to getting your foot in the door lies in taking a different approach – one rooted in patience and persistence … and leveraging the power of the decision maker’s ego.
The very best way to get in front of a decision maker is to ask for advice, and I’ll share a little success story from one of my businesses – the moment that I cracked the code and figured out a way to get inside, nearly every time.
I used to run a business that offered computer forensic services. As I was building and growing my business, there was one company whose business I was dying to land. I’d tried everything – pitches to folks who had the ear of the decision maker, direct appeals with guarantees of my results … nothing worked. I was completely shut out.
This company was big and very successful, and they had a fair bit of employee turnover and had to deal with theft of intellectual property from time to time, so they had a real need for the sort of forensic services I offered. I knew that we were a perfect fit, but the problem was that the company handled its IP troubles in house. I could do a better job, but I couldn’t get to the head honcho to convince him.
Until it hit me: these decision makers are courted by everyone, all day, every day. They have good-sized egos as a result, and if I could find a way to use that ego – in a way that’s honest and ethical, of course – I might be able to find an in.
So I wrote a letter to the guy in charge, and I didn’t ask for a meeting to make a sales pitch – in fact, I promised NOT to make a sales pitch. Instead, I asked for his advice. I asked him to become my mentor. I explained to him that he was my ideal customer, and I wanted his valuable advice on ways in which I could elevate my level of service in order to attract companies like his. I asked for fifteen minutes of his time, and I reiterated that I wouldn’t be making a sales pitch.
He agreed. I was in.
I had my brief meeting. I asked questions and listened carefully to the advice he offered. I made notes on all of the things he wanted in an ideal vendor, and when the meeting was over, I got to work implementing the strategies he’d recommended. When I’d made the improvements he’d recommended, I asked for a second meeting – again making the promise not to try to sell him anything. We reviewed the changes I’d made, and he offered more advice about how to refine my company’s services even further.
Again, I took the advice back to the office and got to work. When the third meeting rolled around, I showed him the changes I’d made, and I could see the pride he felt in my achievements. He felt invested in my success, and he wanted to see my company flourish. He looked at me over his desk and said the magic words: “I want to be your customer.”
What had happened was that my dream client had given me advice on how to sell him – all without realizing it. By asking for advice, rather than his business, I’d earned myself a valuable mentor, and I’d gotten exactly what I’d wanted – the sale. I’d gotten the sale because I’d earned it by applying the advice I’d solicited.
Here’s the deal with this technique – it’s not a trick. When you ask a decision maker for advice, you have to keep your word about not trying to make the sale in your meeting, and you also have to be willing to implement the advice you receive.
This technique requires dedication and patience, but it’s amazingly effective. It doesn’t work every single time – sometimes decision makers aren’t eager to spend their time doling out advice. But when I get that first meeting, odds are good that I’ll be closing a deal in the future.
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