Thursday, February 24, 2011

How Do You Get Customers?

The owner of a small startup company was looking for advice on how to get customers. She had bid a few jobs and dropped off business cards at a few offices but hadn't yet gotten any clients. Her basic questions were "How do I get customers? Why won't they give me business?"

She had been on staff at a commercial cleaning company, had imagined all the money that the owner was making, and had taken a leap to make her own fortune with a commercial cleaning company of her own. Her answers to some basic exploratory questions showed a real lack of preparation:
  • What services do you provide? - "We can do anything."
  • Who needs these services? - "Every business needs us."
  • What do you charge? - "Fifteen hundred dollars a month."
  • Why should someone hire you? - "They need to hire somebody."
While desperately hoping that someone would give her business, she was making it very difficult for anyone to buy her services. She couldn't tell me, or a client, what services she offered. She didn't know how big or how small a client she could handle, or what kind of companies and buildings she'd be able to satisfy. She quoted a price, but without defining what services she would provide. And she couldn't give any reason why a client should hire them as opposed to someone else.

On the surface, this seems naive and ridiculous. How could a business owner be so unprepared?!

But, working with larger established companies, this type of answer is remarkably common:
  • What services do you provide? An industrial machine shop claimed that they could do any kind of fabrication and repair for customers in any industry. No job was too big or too small! Really? You do jewelry repair AND build steam generators for nuclear reactors AND stamp out automotive body panels AND make surgical implants AND erect structural steel for commercial buildings? Define what services you do, define what services you want to do, and communicate that clearly to your customers.
  • Who needs your services? A book keeping service was confident that every business could use them. The reality was that many of the companies they were talking to were either too small to afford them, or too large to need external help. The company advertised widely on the web, yet were really only familiar with the tax structures and regulations in their home province. Some companies are your potential clients, and some are not, whether based on size, geography, industry, or even philosophy. Figure out what kind of companies you want to work for, and go after them, don't waste your time with everybody else.
  • What do you charge? Do you sell products, services, or productized services? Are your rates fixed or negotiable? Do you give discounts? Do you charge based on results, or based on hours worked, or based on a fixed fee? Is it clear to your customers what you will do for the price you'll be charging? Are your prices comparable to other service providers? Are you trying to be cheaper than everyone else, the same as everyone else, or do you price your services at a premium? If you don't know your prices, how do you expect your customers to understand them? How do you expect your customers to buy from you?
  • Why should someone hire you? People don't generally give you business. You need to convince them that you can provide them with something more valuable than the money they will be paying you. They need to trust you, to believe that you can do what you say you will. The small cleaning startup had not prepared any references, marketing literature, price sheets or list of services. There couldn't provide anything that showed why they were different, why they were better, or why someone should hire them. So, no one was hiring them!
You can certainly try to be all things to all people. You can choose to keep your pricing vague and unpredictable. You can hope people will give you business. But you'll probably be better off if you figure out what it is you do, who it is you do it for, how much you charge for it, and why you're better at it than anybody else.

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