Friday, February 18, 2011

WHEN TO SAY "NO" TO A CLIENT

Have you ever taken on a home buyer or builder that is more work than you bargained for?


Most new home builders and factory sales reps have worked with or are currently working with a client who makes the job harder than it needs to be. There are times when a client has work that is more difficult because the work evolves. That happens and you just have to bear down and get it done. 

On the other hand, there are clients who make the work harder because of how they function as clients and home buyers. These are the clients that you pour effort into and get very little in return. It is vital to identify this type of client while they are still in the prospect stage of the sales cycle, and then decide if it's a client with whom you want to do business. If not, let them go. 

Identifying certain "clues" during the sales process may be an indicator to cut the prospect loose. 


The Prospect Has a Negative Tone Throughout the Sales Process


During the initial talks with a prospect, determine the type of client they will be by asking questions and listening closely.  It's a red flag indicator if the conversation has a very negative tone. 

A prospective client who believes they know more than you, or openly resists the direction of the builder or factory rep, are warning signs of what may become a tough client. Pay close attention to how the prospect speaks--and trust your instincts. Is this someone you would want to work with?

The Prospect Repeatedly Haggles Over Price 

Prospects who have problems with price will become clients who have problems with price. Don't undercut the value of your service by giving in to every objection. Use cost reduction sparingly.

Be careful with the prospects that focus only on the issue of cost, as they may already view your service as a commodity. This is usually the case when a factory sales rep tries to bring on an existing new modular home builder.  If you are getting repeated prospects objecting to the price, you may need to reevaluate the value of your services. Turn the focus away from price and see if your services match their needs. Then determine if they have a valid reason to question price or if they are simply trying to reduce your fees.

The Prospect Expects More Than You Can Deliver


One of the most frustrating issues for a builder or factory is working with a client that wants much more than they can deliver. This hurts both sides because the client doesn't get the service they truly need and the builder or factory is working outside of their ability.

In the sales cycle, it is absolutely imperative to sell only what you can deliver. Make sure your prospect knows your capabilities, and you should clearly understand the client's expectations.

Above all, you have to be honest with both the prospect and yourself if you will have trouble meeting their needs. 

The Prospect Wants to Change Your Processes 

The most successful factories and builders have strong processes and procedures in place. There usually can be a little bending room in the process to match the desires of different clients, but the process should not be broken to meet the desires of particular client. This opens firms up to the possibility of a larger breakdown of the process because the exception was made.

Clearly define your process of doing business with a prospect. Never compromise your process in order to sign a new builder or home buyer. A better alternative is to create processes that are adaptable and accepted within the framework of your company.

The Prospect's Ego Overpowers the Conversation

It is very difficult to work for a client who believes he or she has all the answers. Making progress can be very slow and painful with high-ego individuals. This is one of the most difficult judgment calls to make because it is based on perception.

People deal with many individuals with huge egos, but be wary of the person who clearly feels superior to everyone around them. Take heed of the outright rude person who diminishes people when talking. Subjecting yourself, your business or your factory to this type of person can be very dangerous.

Protect yourself or your factory by weeding out the no-win type of situation during the sales cycle. Determine and define your company's ideal client, and the type of client that is not so ideal. Don't settle for every prospect that says yes when you know the work will be more involved than it's worth. Use the time in the sales process to ask the right questions, clarify your services and make sure both sides understand the work to be performed.

If there is an issue with any of the above examples or you don't feel right, consider telling the prospect you will be unable to work with them. This will save time, money and effort and will allow your team to focus on those ideal clients.  Just say NO!

1 comment:

Anonymous said...

You hit this one out of the park. I've had my share of each of those types of customers. In the end, they want to take you to court. I've learned my lesson, at least until the next customer comes along.LOL