Diary of Opening A New Business

[snowbank]

What part of Texas?

 

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[JEdwards]

What part of Texas?

Close to you...

 

[JEdwards]

Had a great day.. We have 3-4 sales in play, one or two will close, have another girl getting on the phone tomorrow and then 2 more on Thursday, so my hopes are to close 5 deals by Friday. But we will see.

Got my Voip deal figured out. Fun fun.

 

[JEdwards]

Even though the first sale has eluded us, I am hiring, as of Monday if everyone shows we will have...

7 people involved in this venture full time. me, other guy, operational mgr, sales manager, 3 sales people.

Wow, It's go time. Money is burning.

 

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[JEdwards]

Quick Update. Little venting.

New Sales Manager quit, new girl didn't show up.

So we are back to 5 people, but have a few interviews today. I want to hire 3 new people this week.

2 problems,

Voip really screwed up the day, it was sketchy at best, going to have to see if they can fix or go with the old regular lines. Sucks having 3 people (that you are paying a min of 13 an hour to) trying to sell and not being able to make a call. note google voice works perfectly.

Credibility, as of right now we have had 7 sales fall through our hands, so we need desperatly to get some references real quick. Trying to figure out how much to drop prices to get the few references we need.

Exciting times. Going through some cash right now, will give a run down at the end of the week, still under 6k probably but it is the little crap that costs. Made a run to office depot, that was over $100 bucks.

Every penny counts.

Jack

 

[ZCP]

I don't know, Jack. Maybe YOU have to make the first two sales to get the momentum going. It will help you refine the process and see where the stumbling / abandon point is in your script. That positive momentum can make a huge difference with the salespeople. We often sell in batches where the momentum helps give the confidence that helps overcome the objections which helps land the sale.

 

[Michael W.]

I don't know, Jack. Maybe YOU have to make the first two sales to get the momentum going. It will help you refine the process and see where the stumbling / abandon point is in your script. That positive momentum can make a huge difference with the salespeople. We often sell in batches where the momentum helps give the confidence that helps overcome the objections which helps land the sale.

Exactly what I was thinking. Use your successful past as a reference for customers, post it on your website (if you haven't already) to let potential customers know your company is credible. But you know this already.

I struggle with the credibility concept in my energy "startup".

 

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[Guest3722A]

New Sales Manager quit, new girl didn't show up.

They perhaps don't believe or are concerned of being one of the first ones there. Wimps. If this is the possible case, what I did when I faced a similar scenario was create the illusion that my newcomers weren't the first.

If you get to do or die, I'm willing to bet I can close a sale for you, provided of course that there's an adequate need for whatever it is you're selling, and the time needed to sell wouldn't be extensive or involve my physical presence. If it gets to this point let me know and I'll see what I can do. I enjoy the adrenaline rush.

 

[JEdwards]

Sold 2 deals today. So now we have something working.

Yes, it is because the newness, I always had a much bigger office and experienced people before and I would just switch them, this deal I am starting from scratch, no employees, so the smallness of it is most likely a possibility, that is turning them off, people are coming in and it is 2-3 guys sitting together around a conference table.

Now that we have 2 girls in the office it makes it easier for the next one to believe. That is the hopes.

But now we have 2 (I Hope, will find out tomorrow) Girls calling and a few more pretty good ones in the pipeline.

This is fun.

 

[andviv]

Sold 2 deals today. So now we have something working.

Congrats!

 

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[andviv]

Do you have to have the people making the calls there in the office? Can you outsource that and have them work remotely?

 

[JEdwards]

Thanks, Thousands more to go.

The plan is to sell between 80 and 100 deals in 4 weeks, lets see if we can pull that together.

 

[JEdwards]

Do you have to have the people making the calls there in the office? Can you outsource that and have them work remotely?

At this time I have to have them in the office, it is a learning curve, really don't see it becoming a sale from home type of deal. (Limited number of deals to be had) They sometimes also have to go out and visit the clients.

I would never outsource the sales process, that would never work, cause if someone else could sell it, they don't need me.

 

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[Kung Fu Steve]

These guys have brought up an interesting question. "Why not do it yourself!?"

I personally know how important it is to delegate tasks and realize that you cannot be the person who does that work to make the business grow, but let me ask you this:

Do you still feel the urge to "take control" and "do it my damn self" ?? If so, how do you handle that urge?

 

[JEdwards]

These guys have brought up an interesting question. "Why not do it yourself!?"

I personally know how important it is to delegate tasks and realize that you cannot be the person who does that work to make the business grow, but let me ask you this:

Do you still feel the urge to "take control" and "do it my damn self" ?? If so, how do you handle that urge?

I don't really have that urge. I am on the organizational, idea side. I know it can and will be sold because it makes sense, it adds value. There are people that are great at some things and not so good at others, I know what I am good at.

Not to say that I could not sell it, I could, but what does that prove? Right now we are creating a system, once we have that system then it is just scale. Hopefully in a few weeks we will be moving up into a much bigger space.

 

[Michael W.]

In my defense, I only suggested selling it yourself to gain the first few customers, also maybe to show proof of concept. Using your past success to build credibility for your company and gain customers trust in the beginning would probably lead to closing some sales.

Just my theory.

 

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[JEdwards]

In my defense, I only suggested selling it yourself to gain the first few customers, also maybe to show proof of concept. Using your past success to build credibility for your company and gain customers trust in the beginning would probably lead to closing some sales.

Just my theory.

Sorry, I did not mean that you were wrong in anyway, and you are 100% correct. Usually the owner should take the lead and close some deals, etc. But with this I already have operations person lets say, that needs to be able to sell the deal, to make sure the others can sell the deal. If he fails, yes I will step in, but at this point it is a learning process. And please believe I am at the center of every call, just not making the call.

Good or bad, I have removed myself away from that aspect of the business. We will see if it works.

 

[darkjediii]

I agree with you Jack. I don't think you have to make the sale yourself. You hired an experienced sales manager and sales people, so you should not have to teach them how to sell because if you hired the right people, they should be able to outsell you at least 5-1 anyway.

All you need to really focus on is to get with the sales manager and come up with an excellent sales process/program and aggressive quotas. Then you need to hold these people accountable for their own leads and sales.

From the info you shared with us, it seems like right now your main problem is getting the sales. So obviously you need to devote most of your time concentrating on developing your sales program. this should involve: listening in on the sales calls, working with your sales manager to tweak and improve, set quotas, identify your sales people's strengths and weaknesses, analyze each call, recruit the top sales people and get rid of the non-producers etc..

Remember: Sales people are like teenagers, they can be very lazy/unproductive or if given the right push, they can be amazingly productive.. A wise man once gave me advice on how to handle sales people: don't tell them how much they could make. ASK them how much they would like to make in 1 year wether it be 65k 100k or 200+k, then break that down to measurable goals and hold them strictly to it.

I think you are headed in the right direction. Good luck on the new venture and I look forward to your every update!!

 

[CVentures1B12]

Sorry, I did not mean that you were wrong in anyway, and you are 100% correct. Usually the owner should take the lead and close some deals, etc. But with this I already have operations person lets say, that needs to be able to sell the deal, to make sure the others can sell the deal. If he fails, yes I will step in, but at this point it is a learning process. And please believe I am at the center of every call, just not making the call.

Good or bad, I have removed myself away from that aspect of the business. We will see if it works.

I have the opposite problem! I can make the sales, but I need to remove myself from the operations side of the business (actually tutoring).

Oh and Voip blows!

Congrats on your sales

JC

 

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[JEdwards]

I have the opposite problem! I can make the sales, but I need to remove myself from the operations side of the business (actually tutoring).

Oh and Voip blows!

Congrats on your sales

JC

Thanks, that is not a big problem, usually it is a sales problem so congrats for you. You just need to find the right people to run the organization side.

 

[ZCP]

The 'you make the sale' suggestion was merely for momemtum. Whenever the team is down, the leader needs to step in a make them believe. Sometimes it is as simple as showing them it CAN be done. Then they are off and running. Your management layer should have handled this, but sometimes they need to be shown as well. All you need is a few legendary stories of the big boss coming down and closing a sale in 7 minutes and you have built the foundation for scale that will last forever.

 

[ZCP]

Also, now that you have some sales in, could you update us on your burn rate and breakeven point?

Are your procedures written, video, word of mouth? How did you setup your initial training and is it scalable?

 

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[JEdwards]

Your first comment, I get it. It is a bit political, I do not want to undermine the talent I have in place, by showing-off and closing a deal in 7 minutes. (i doubt I could close one in 7 minutes anyway) I really think at this point the number of sales calls we have made, does not justify me jumping in and undermining what we are trying to set up. We are still creating the process.

If we had 20-30 people and they were all sucking wind, I see the "let me show" you morale builder deal, we are just not at that point.

Also, now that you have some sales in, could you update us on your burn rate and breakeven point?

Are your procedures written, video, word of mouth? How did you setup your initial training and is it scalable?

On to your questions.

1. Can't say yet, we need to figure out an average, as our sales are at different price points, I need to sell 20-30 to really figure that out.

2. Procedures, don't understand your questions on that one.

3. Scalable yes. Even though we will top out at 8-10 sales people on this project, training wise, I think what we have set up is workable, we have a training area. Basically two desks put together and the trainer and new sales person work back and forth.


Also even though at this point, learning to sale is the most important point, there is a whole other side I must put together to facilitate those sales, and everyday I am working closer to putting that system together.

Jack

 

[buckmajor]

Cool diary, thanks I am following this and learning so much already. It reminds of Wallstreet some how.

 

[JEdwards]

End of the week update.

Sadly we had to close today due to the snow, just when we were on a roll, but through yesterday we have closed 7 sales total.

Offered jobs to two more people, one said she could not find day care and the other just didn't show up.. This is the hardest part so far, but now that we have kind of a working model, we just need to make sure and duplicate.

Also now that we have 3 people making sales, it will not be as hard to pick up new people. (I think it had a lot to do with people walking in and seeing no one doing anything, no synergy)

Right now we are still at 6 people. losing money like crazy. But with a few changes and if we can close out an average per person next week, then we will add like crazy.

Thanks for reading.

 

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[LightHouse]

Just curious Jack, i hope it wasn't answered already. Is what your selling a tangible product that requires fulfillment? You have discussed sales people but not a mention of fulfillment or folks that do any sort of service work either. Are you an intermediary company?

 

[andviv]

Wow, that is so cool!

Have you offered a referral bonus to your existing employees? Say, $500 for a successful recruit who lasts 60 days working for you... convert your current employees in recruiters as well.

I can't recall if you mention whether you were selling a physical or digital product or a service... mind sharing that piece of info?

 

[ZCP]

We went with $100 gift cards for referrals / new customers / etc. Not a lot of cost, but a lot of impact with the staff.

 

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[ZCP]

2. Procedures, don't understand your questions on that one.
Jack

The question was about the format and setup for your sales training materials. Was thinking it might have been a turnoff and a reason for staff not showing up.....in addition to the 'there is no one else here doing it too' issue that you may have solved.

Congrats on the sales. What are you using for lead gen at the moment? Any tracking software?

 

[JEdwards]

Just curious Jack, i hope it wasn't answered already. Is what your selling a tangible product that requires fulfillment? You have discussed sales people but not a mention of fulfillment or folks that do any sort of service work either. Are you an intermediary company?

Actually we are selling both. They go together, I just don't want to give away to much here. (niche market) and 3 of the 6 are fulfillment. Ultimately in the next 24 months, I am hoping to need a 100,000 sq ft warehouse along with the office staff... I would rather not say more, not that it is a big secret or anything, a ton of people do the same thing, just not yet..

Wow, that is so cool!

Have you offered a referral bonus to your existing employees? Say, $500 for a successful recruit who lasts 60 days working for you... convert your current employees in recruiters as well.

I can't recall if you mention whether you were selling a physical or digital product or a service... mind sharing that piece of info?

Not, yet, one of the salespeople has 2 friends, that she thinks will work, I can fill spaces, just not looking to do that, I am still not 100% confident with the system yet, how to sell, how to train, so I am being selective, I just need to get training and an average down and then I will hire and hire...

Well up to the 10 people we need... It is a niche product so not that many people to call.