Friday, September 19, 2008

Know Your Numbers, part 2

You'll likely find cold calling a necessary evil unless you already have a handful of solid leads when you start your company, or until your first customers begin to refer others to you.

Outbound plusses:
· If you reach a prospect, or at least a suspect, through cold calling, then she may not know

anything about your competitors.
· When you do your research (always do research before a call), you may catch the prospect

just as she is thinking about buying. It often happens.
· If the prospect has not thought about buying, you get the opportunity to educate her a

little, helping her to identify a business pain that she may not have realized she had. When

she pictures the solution to that pain, perhaps she’ll envision no one but you.

Outbound minuses:
· Nobody likes receiving cold calls.
· You don’t like making them.
· The sales cycle could be longer because the prospect is in less hurry than the inbound caller

to make a decision.
· The prospect, only mildly serious about buying anyway, may never make a decision, other

than the decision to do nothing.
· You really, really don’t like making cold calls.
· The prospect really, really doesn’t like getting them.

· You successfully get the prospect thinking she needs what you're offering, but she decides

to see who else out there offers something similar.

Some mix of inbound and outbound calls is essential to most any new company’s survival. Diligently track your numbers and results so you always know where and how to focus your efforts.

Here’s an example of the ratios you should track:

Inbound inquiries > Appointments > Proposals > Sales
Outbound calls > Appointments > Proposals > Sales

Also, track the sales cycle (time from call to sale) for each prospect, as well as the total initial value of the sale. For example, does it take two weeks to make a sale from inbound inquiries, but six weeks to make a sale from outbound calls? If you’re lucky, you’ll find that the inbound inquiries, though fewer, will generate more revenue in a shorter amount of time than a higher number of outbound calls.

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