Cold Calling - Am I doing this wrong?

[Jon L]

I own a small company with a team overseas that builds custom software for businesses. I've made enough to pay for the expenses of a family of four, in an expensive city, but not much more. The reason I haven't made more is that my sales skills have been lacking. That's changed, though, and I've gotten a lot better at it. At this point, if a prospect has a project and the budget, I can easily talk them into using me. I do that by listening and giving the client what they want (a development company that cares, understands their business, will help them build what they truly need instead of what they think they need, and will support them long-term).

Recently, I've cold called IT service companies, talking with them about a 'potential partnership' where I provide software programming services to their clients. Out of 200 calls over the last 6 months, I've netted about $25k. That's not a bad return on 200 calls, but I need to ramp things up dramatically. (I had several other large projects that are now concluding that were supporting me). Out of those 200 calls, I had probably 20-40 conversations and about 5 companies that have said that they want to direct clients my way. Out of the five, 2 have already given me clients, and will continue to do so. The others, I'm nurturing.

By the way, even though I have clients that rave about me, I haven't gotten too much referral business. I talked to a recent client a month ago, for example. He said, 'by the way, I mentioned your name to a friend of mine.' Now that I think about it, I probably should have asked for that friend's name and phone number. Overall, though, my best source of leads has been service firms that know the business needs of large numbers of clients. I do get former clients that have me do a fair amount of additional work for them.

So: a few questions:
1) Calling IT companies that support the computers and networks of other businesses is an easy sell. When I do find someone that's open to working with me, we have a great conversation. We'll often end up talking for an hour or more. Is this the best use of my time, or should I try calling companies that might need my services directly?

2) The list I'm using, from Dunn & Bradstreet, no less, is frustrating to use. I'd guess that only 15% of the companies on it are my target market (IT companies that support small to midsized businesses, and are themselves decent size (10+ employees, min). The rest are companies that fix iphones, repair laptops, or generally have a very small mindset and probably don't gross more than $50k per year. These types of companies would never have a conversation with a client about their custom software needs. I find that I spend a lot of time sifting through this mess. In 2 hours yesterday, I sent 3 emails and called 5 companies. Is this normal?

3) How do I know if I'm using my cold calling time effectively? I've read books that say that I should be making 10-20 dials per hour, and not spending much time researching prior to making the call.

Thanks!

 

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[Primeperiwinkle]

@458 is a cold calling genius tour de force. Maybe he could chime in?

 

[Andy Black]

1) Calling IT companies that support the computers and networks of other businesses is an easy sell. When I do find someone that's open to working with me, we have a great conversation. We'll often end up talking for an hour or more. Is this the best use of my time, or should I try calling companies that might need my services directly?

I can’t help you with cold calling advice as I don’t do any. Is @458 our resident cold calling guy?

I like chatting to people for an hour, and chat equally to potential end clients, and to people who have a lot of clients I could help.

I prefer to spend my quality phone/Zoom/Skype time building good relationships rather than cold calling.

I’ve found that when I chat to someone for an hour then, even if they don’t turn into a client (which most don’t), they will often refer me on for years to come.



There’s some good recorded webinars that I listened to in Facebook groups of people building Facebook agencies. Some of their strategies for cold emailing and calling were very good.

From memory, one guy outsources to work-from-home mums/dads to cold call businesses marching certain criteria purely to setup an appointment with him.

Could you do the same so you only get on the phone to people who have been somewhat screened already?

 

[Jon L]

I can’t help you with cold calling advice as I don’t do any. Is @458 our resident cold calling guy?

I like chatting to people for an hour, and chat equally to potential end clients, and to people who have a lot of clients I could help.

I prefer to spend my quality phone/Zoom/Skype time building good relationships rather than cold calling.

I’ve found that when I chat to someone for an hour then, even if they don’t turn into a client (which most don’t), they will often refer me on for years to come.



There’s some good recorded webinars that I listened to in Facebook groups of people building Facebook agencies. Some of their strategies for cold emailing and calling were very good.

From memory, one guy outsources to work-from-home mums/dads to cold call businesses marching certain criteria purely to setup an appointment with him.

Could you do the same so you only get on the phone to people who have been somewhat screened already?

I actually really want to get good at cold calling. Crazy as that sounds. I recently cold-emailed the author of a cold calling book. The guy got back to me and complimented me on my email. We exchanged a few emails and he invited me to keep in touch with him. ... needless to say, that got me pretty fired up about the whole thing.

 

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[Dan_Cardone]

I have a thread in the INSIDERS forum about cold calling you may like.

 

[broswoodwork]

I actually really want to get good at cold calling.

It doesn't sound like you're that bad at it, to be honest.

Cold calling is a wicked numbers game. I think in @458 's thread, he was saying his guys hammer the phone with 200 dials a day.

Maybe if you outsourced the opening cold calls and just closed the hot leads after a handoff it'd change the game?

 

[Jon L]

It doesn't sound like you're that bad at it, to be honest.

Cold calling is a wicked numbers game. I think in @458 's thread, he was saying his guys hammer the phone with 200 dials a day.

Maybe if you outsourced the opening cold calls and just closed the hot leads after a handoff it'd change the game?

Thanks...I'm good at the actual calls now, but I need to figure out how to be more efficient, I think. ... What I'm really wanting to know from people is what I can improve on, and how I would compare to someone that's really good at it.

Sales is one of those things that is so important to a business that I want to be good at it myself before I outsource it. I've gone the outsourcing path before, and that hasn't gone as well as I'd hoped.

 

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[Tiago]

Check out Connect and Sell. Their services might get you connected much faster.

Also I’m working with a coach who owns a 7 figure business, has built it through cold calling and is teaching me cold calling and sales. If you want I can connect you with her, she might be able to help.

 

[Jon L]

Check out Connect and Sell. Their services might get you connected much faster.

Also I’m working with a coach who owns a 7 figure business, has built it through cold calling and is teaching me cold calling and sales. If you want I can connect you with her, she might be able to help.

I'd love a coach for this kind of thing. Thanks!

 

[broswoodwork]

Thanks...I'm good at the actual calls now, but I need to figure out how to be more efficient, I think. ... What I'm really wanting to know from people is what I can improve on, and how I would compare to someone that's really good at it.

Sales is one of those things that is so important to a business that I want to be good at it myself before I outsource it. I've gone the outsourcing path before, and that hasn't gone as well as I'd hoped.

Back in my recruiting days, our leads were always warm in the sense that contractors had their resumes up on the job boards, clients had advertisements saying they were hiring, we fished tips out of the contractors about where they had interviewed recently, or we rused the tips out of other shops with fake resumes. I'm not sure how applicable any of that can be to selling software... Unless there's some way to tell ahead of time with companies are shopping around for a solution.

You could go with the bird dog route and slip one of your competitor's employees a $100 for letting you know when they're putting in a proposal somewhere. That way you know the client is actively buying before you call.

I'm rambling now. Sorry.

 

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[Tiago]

I'd love a coach for this kind of thing. Thanks!

Send me a PM, I’ll send you her details.

 

[458]

It doesn't sound like you're that bad at it, to be honest.

Cold calling is a wicked numbers game. I think in @458 's thread, he was saying his guys hammer the phone with 200 dials a day.

Maybe if you outsourced the opening cold calls and just closed the hot leads after a handoff it'd change the game?

3,000 - 5,000 dials per day, 200 connected calls per person

 

[458]

I own a small company with a team overseas that builds custom software for businesses. I've made enough to pay for the expenses of a family of four, in an expensive city, but not much more. The reason I haven't made more is that my sales skills have been lacking. That's changed, though, and I've gotten a lot better at it. At this point, if a prospect has a project and the budget, I can easily talk them into using me. I do that by listening and giving the client what they want (a development company that cares, understands their business, will help them build what they truly need instead of what they think they need, and will support them long-term).

Recently, I've cold called IT service companies, talking with them about a 'potential partnership' where I provide software programming services to their clients. Out of 200 calls over the last 6 months, I've netted about $25k. That's not a bad return on 200 calls, but I need to ramp things up dramatically. (I had several other large projects that are now concluding that were supporting me). Out of those 200 calls, I had probably 20-40 conversations and about 5 companies that have said that they want to direct clients my way. Out of the five, 2 have already given me clients, and will continue to do so. The others, I'm nurturing.

By the way, even though I have clients that rave about me, I haven't gotten too much referral business. I talked to a recent client a month ago, for example. He said, 'by the way, I mentioned your name to a friend of mine.' Now that I think about it, I probably should have asked for that friend's name and phone number. Overall, though, my best source of leads has been service firms that know the business needs of large numbers of clients. I do get former clients that have me do a fair amount of additional work for them.

So: a few questions:
1) Calling IT companies that support the computers and networks of other businesses is an easy sell. When I do find someone that's open to working with me, we have a great conversation. We'll often end up talking for an hour or more. Is this the best use of my time, or should I try calling companies that might need my services directly?

2) The list I'm using, from Dunn & Bradstreet, no less, is frustrating to use. I'd guess that only 15% of the companies on it are my target market (IT companies that support small to midsized businesses, and are themselves decent size (10+ employees, min). The rest are companies that fix iphones, repair laptops, or generally have a very small mindset and probably don't gross more than $50k per year. These types of companies would never have a conversation with a client about their custom software needs. I find that I spend a lot of time sifting through this mess. In 2 hours yesterday, I sent 3 emails and called 5 companies. Is this normal?

3) How do I know if I'm using my cold calling time effectively? I've read books that say that I should be making 10-20 dials per hour, and not spending much time researching prior to making the call.

Thanks!

Goals?
Budget?
New lead ceiling per day? IE. There is 10,000 new leads available in the market place per day.

Depending on your answers I can give you some good direction and course of action.

 

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[458]

@458 is a cold calling genius tour de force. Maybe he could chime in?

I'm just insane, like a mad scientist.. but definitely not a genius

 

[Jon L]

Goals?
Budget?
New lead ceiling per day? IE. There is 10,000 new leads available in the market place per day.

Depending on your answers I can give you some good direction and course of action.

My target for now is selling software systems in the 10-25k range. Those are easy/quick sells in the world of custom software. The typical company that needs that kind of work are:

1. small mattress store chain that doesn't want to spend $50K for a point of sale (cash register) system.
2. network cabling company that had an old system on an old server that was failing. System was built on old technology. Required a rebuild using new software tools so that it would work on new servers
3. System for a real estate investors that would allow them to speed up their processing of houses
4. System for an oil and gas contractor that allowed them to provide reports to clients detailing exactly what they were doing for them, without requiring project managers to spend a day a week producing the report.

As you can see, this is a wide variety of cases, industries, etc. What they all share is:

1. They were small and then grew. When small, the processes they used worked. When they grew, those same processes became onerous
2. Off the shelf software was either too expensive, or didn't exist for what the client needed. For the oil and gas contractor, they did business a certain way, a way that worked very well for them. Off the shelf software would have required that they change key business practices.
3. They are process oriented, doing the same thing over and over and over.

 

[458]

My target for now is selling software systems in the 10-25k range. Those are easy/quick sells in the world of custom software. The typical company that needs that kind of work are:

1. small mattress store chain that doesn't want to spend $50K for a point of sale (cash register) system.
2. network cabling company that had an old system on an old server that was failing. System was built on old technology. Required a rebuild using new software tools so that it would work on new servers
3. System for a real estate investors that would allow them to speed up their processing of houses
4. System for an oil and gas contractor that allowed them to provide reports to clients detailing exactly what they were doing for them, without requiring project managers to spend a day a week producing the report.

As you can see, this is a wide variety of cases, industries, etc. What they all share is:

1. They were small and then grew. When small, the processes they used worked. When they grew, those same processes became onerous
2. Off the shelf software was either too expensive, or didn't exist for what the client needed. For the oil and gas contractor, they did business a certain way, a way that worked very well for them. Off the shelf software would have required that they change key business practices.
3. They are process oriented, doing the same thing over and over and over.

You answered zero of my questions.. what are your goals, what is your budget, what is the lead potential per day. If you don't know, now you know where to start.

 

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[Jon L]

You answered zero of my questions.. what are your goals, what is your budget, what is the lead potential per day. If you don't know, now you know where to start.

Goal is to sell 4 systems like what I mentioned above per month
budget: $500/month
Not sure what lead potential per day means. Out of 100 cold calls & emails, I sold $25k worth of projects.

 

[458]

Goal is to sell 4 systems like what I mentioned above per month
budget: $500/month
Not sure what lead potential per day means. Out of 100 cold calls & emails, I sold $25k worth of projects.

Ok then make 400 cold calls, 20 calls per day. Magic!

 

[Primeperiwinkle]

OP, Feel free to write an aside post about 458 and complain about his “magic”.

(see how I didn’t tag him?!? It’s cuz I want him to IGNORE the emo part of this convo now! ROFL)

I know he’s right.. but omg its awful when he gives you simple advice and you just kinda sit there numb for a minute. (I’m speaking from experience)

 

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[Jon L]

Ok then make 400 cold calls, 20 calls per day. Magic!

Responding to this is a bit awkward for me. I get what you're saying, but the way that you say it leaves me with emotions that are not properly discussed over a public chat forum.

The more that I think about it, what I'm looking for is a coach that can walk me through the detail of what I'm trying to do ... a large part of that is how to deal with the emotional side of sales.

 

[458]

Responding to this is a bit awkward for me. I get what you're saying, but the way that you say it leaves me with emotions that are not properly discussed over a public chat forum.

The more that I think about it, what I'm looking for is a coach that can walk me through the detail of what I'm trying to do ... a large part of that is how to deal with the emotional side of sales.

See, now we're getting somewhere..

Can you define exactly what you mean by emotional side? Gate keepers grilling you? Getting slammed by guys named Bob?

I'll be honest though, I am a natural born closer, I'll be the first to admit that. If you find the pain of getting slammed increases proportionally with the increase in dials then cold calling may not be for you..

Do 5,000 calls and then report back what it felt like to get slammed on 5,001. That will tell you whether this is for you or not.

 

[Jon L]

See, now we're getting somewhere..

Can you define exactly what you mean by emotional side? Gate keepers grilling you? Getting slammed by guys named Bob?

I'll be honest though, I am a natural born closer, I'll be the first to admit that. If you find the pain of getting slammed increases proportionally with the increase in dials then cold calling may not be for you..

Do 5,000 calls and then report back what it felt like to get slammed on 5,001. That will tell you whether this is for you or not.

How to characterize myself... I've been plagued by self doubt most of my life. In the past, I really didn't know how to interact with people much at all. Now, I have a pretty decent handle on that. On the sales side, if a prospect has a budget and a project, I can close them 9 times out of 10. Cold calling to find/develop projects is something I would like to get good at.

My current strategy is to partner with IT service companies. These companies will run across custom software projects on occasion (a few times a year). Typically, they don't have anyone to refer people to, and so that client need just goes unfulfilled. I've gotten a few projects this way in the 6 months I've been pursuing this.

If I called 20 companies a day like you said, I'd likely have 40k/month in revenue.

Maybe I'm an idiot and should just do that?

But I also feel like I'm wasting a lot of time when I call. The list I'm using kinda sucks: only about 15 percent of it are companies I actually want to talk to. The rest wouldn't know their clients well enough (either because they only do break/fix, or because their clients are only residential, etc). So, I spend a lot of time looking at websites, marking people off the list, etc. In 2 hours the last time I did this, I made 5 calls and sent 3 emails.

I also wonder if this strategy is the best use of my time. Should I try going direct to potential clients? And, if I do, I wonder if what I'm planning to say is the best strategy.

 

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[Andy Black]

How to characterize myself... I've been plagued by self doubt most of my life. In the past, I really didn't know how to interact with people much at all. Now, I have a pretty decent handle on that. On the sales side, if a prospect has a budget and a project, I can close them 9 times out of 10. Cold calling to find/develop projects is something I would like to get good at.

My current strategy is to partner with IT service companies. These companies will run across custom software projects on occasion (a few times a year). Typically, they don't have anyone to refer people to, and so that client need just goes unfulfilled. I've gotten a few projects this way in the 6 months I've been pursuing this.

If I called 20 companies a day like you said, I'd likely have 40k/month in revenue.

Maybe I'm an idiot and should just do that?

But I also feel like I'm wasting a lot of time when I call. The list I'm using kinda sucks: only about 15 percent of it are companies I actually want to talk to. The rest wouldn't know their clients well enough (either because they only do break/fix, or because their clients are only residential, etc). So, I spend a lot of time looking at websites, marking people off the list, etc. In 2 hours the last time I did this, I made 5 calls and sent 3 emails.

I also wonder if this strategy is the best use of my time. Should I try going direct to potential clients? And, if I do, I wonder if what I'm planning to say is the best strategy.

Are you able to define the right people to cold call vs the wrong people? If so, can you get someone else to bring you a list of folks that match those criteria so you can either cold call them, or where an appointment is setup and you’re calling someone who’s expecting the call?

All my calls are “warm”. I’ve built a relationship before we hop on a call, or they’ve been referred to me. And not only are they expecting the call, they have already expressed an interest.

I hope I’m helping! I’m a bit confused by what your goal is. Is it get good at cold calling (because you believe it will help you in other areas as well as making sales), or just to make sales?

 

[Rabby]

So: a few questions:
1) Calling IT companies that support the computers and networks of other businesses is an easy sell. When I do find someone that's open to working with me, we have a great conversation. We'll often end up talking for an hour or more. Is this the best use of my time, or should I try calling companies that might need my services directly?

2) The list I'm using, from Dunn & Bradstreet, no less, is frustrating to use. I'd guess that only 15% of the companies on it are my target market (IT companies that support small to midsized businesses, and are themselves decent size (10+ employees, min). The rest are companies that fix iphones, repair laptops, or generally have a very small mindset and probably don't gross more than $50k per year. These types of companies would never have a conversation with a client about their custom software needs. I find that I spend a lot of time sifting through this mess. In 2 hours yesterday, I sent 3 emails and called 5 companies. Is this normal?

3) How do I know if I'm using my cold calling time effectively? I've read books that say that I should be making 10-20 dials per hour, and not spending much time researching prior to making the call.

1) Calling referral sources is the right thing to do, if they actually send business. If you're going to spend time selling, sell to someone who can send you multiple clients over time. You'll also have an easier time of it... calling an IT service guy gives him a way to help his clients. He's naturally aligned with the idea, and not "defensive" because you're collaborating on how to sell to his clients, rather than selling to him directly.

One thing I might change, is build something into your pricing so that you can pay the IT service guys a commission based on the size of the sale. This will motivate them to send more people. Keep in mind, a lot of them are probably MSPs and VARs who are actually selling on commission.

2) Try Sales Genie. You might find you can sort the list a lot better, and get more of who you need. Also, I wouldn't spend hours sorting through the list. If it takes 2 hours to sort the list, you could just call all the numbers in that time. Don't research too much. Another thing you can try is just use Google Maps search... it's free and you can call all the businesses of a type in a zip code. I think Sales Genie is worthwhile to try though.

3) Research is an easy way to waste time. You can call an iPhone repair shop and talk to them for 10 seconds, or you can spend time figuring out whether they're just an iPhone repair shop by reading their web page. The second option seems like it could take a lot longer. If you want to sort them, don't do it yourself. Hire someone for $10/hr and teach them to sort the list for you. YOU wasting YOUR time is a travesty to the business. It can't be allowed! If the skill you're working on is calling, spend time calling.

All that said, it's probably worth adapting your cold call script to an email and sending those out too. It's nice to get incoming emails and calls from interested people right?

 

[Tourmaline]

I love what you're doing!

If I called 20 companies a day like you said, I'd likely have 40k/month in revenue.

Maybe I'm an idiot and should just do that?

Have you gone through Belfort's Straight Line Persuasion?

 

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[Dan_Cardone]

If I called 20 companies a day like you said, I'd likely have 40k/month in revenue.

Did you forget a zero?

 

[broswoodwork]

My current strategy is to partner with IT service companies

Awesome strategy. Fishing with nets. Every single yes you get from a cold call leads lots of yes's in perpetuity. It's like almost a perfect system.

Do they get a kickbackor are they just happy to point their clients in the right direction?

 

[Primeperiwinkle]

I just need you ppl to know that I was PARTICULARLY kind to a cold caller today and even outlined why their strategy was inherently flawed.

The guy was not amused.

 

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[Jon L]

Did you forget a zero?

Nope. ... and thinking more about this, I think I need to just do what has been working, and not worry if I'm 100% efficient at it.

 

[Dan_Cardone]

Nope. ... and thinking more about this, I think I need to just do what has been working, and not worry if I'm 100% efficient at it.

20 cold calls a day is nothing. If you want to be successful you will want way more than that.