Start-up Entrepreneurs' Blog

Start-Up Sales Traps and Missteps

October 6, 2011

Marginality

Your company has sales. However, not enough sales to be a flourishing or growing business, but just enough to linger as a marginal business and give the entrepreneur hope. What’s the cause of this issue?

Misunderstanding the Customer’s Perspective

Businesses are supposed to produce products that solve someone’s problem. An entrepreneur can think they are solving someone’s problem and think this problem is a priority for the customer, when in fact, the customer may not agree with this view point. The customer’s actual problems may be quite different, or your product may only be solving a small portion of the customer’s problem.

Sometime sales effort focus too heavily on the features that a product have, and sometimes it hones in too much on the problem without gaining an understanding of what they customer’s goals were or what the customer was trying to accomplish.

Misinterpreting Sales

So often, it is the determination of the buyer, and the intensity of the buyer’s need, that completes the sale rather than any action provided by the sales team.

Functional Misalignment

Marketing and sales are closely related functions but they are not the same. Marketing creates demand for the product, whereas sales captures the demand and converts it into revenue. If marketing is trying to create demand in a misaligned customer base, sales will have difficulty closing deals. If these are two separate functions within a company, sales is unlikely to help fix the realignment problem, they will sit back and wait for better leads. Marketing and sales have to work in harmony and they have to work effectively together.

Sales Is Not Black Magic Only to be Performed by a Magician

Many entrepreneurs believe they can just hire a good sales person to handle marketing and sales for their fledgling start-up. The truth is great sales people are always in demand, and the better the sales person the more they want commission and the less they want salary. It’s hard for a new start-up with no customers to provide attractive employment for a good sales person. This is the hardest and most challenging sales job of all. Most entrepreneurs and founders have to take on the sales role themselves. Good sales people become interested when the start-up has $50,000 to $100,000 in monthly sales and in particular, where they see lots of leads and deals not being closed, and where they see a lack of a sales process. This is when a good sales person knows they can make a huge difference.

The sales team in a company does it on a part-time basis, maybe team members have other responsibilities in the organization and these other activities often take precedence over selling. Sales is like being an athlete, you can’t get good at it unless you practice it frequently and daily. No one wins a marathon by practice short distance runs once a week.

Initial Progress May Not Be Sustainable

I met the owner of an insurance agency. He told me that when a new sales person starts, they make many sales in the first 3 months, but the mark of a good sales person is when sales continue to flow into the agency after those first 90 days. The reason is consumer sales people exhaust their friends, family, and contacts in that time, and then their true sales ability shines though. Its closing deals with new customers that’s the indicator of sustainable sales performance.

 

Filed under: Marketing & Sales

Tags: start-up sales mistakes