About a half of a million businesses will be created this year in the US. That means at least a half million people out there are trying to figure out how they are going to generate revenue. Based on conversations I’ve heard or read recently, many of those half million have the mistaken impression that branding, PR and social media will generate sales. It’s not true. All of those things can support your sales channel, but they aren’t your sales channel. Based on interviews with more than 100 entrepreneurs and many years of my own experience generating revenue, sales come from actual sales channels.
To generate revenue, you need a sales channel. Someone or a group of someones has to identify your prospects, reach them to pitch your products or services effectively, and close the deals. If the sales channel is great at doing all three, you will get sales and generate revenue, with or without Twitter.
Starting out, how do you create a sales channel? Here are a few ideas for the new business owners out there.
1. You are a sales channel. I’ve started several businesses, and the first sales have always come from my identifying prospects, pitching my products and services, and closing the deals. Among the more than 100 entrepreneurs we interviewed, almost all of them did the same thing. The first customers were people we knew, and more importantly, people who knew us.
2. Hire sales people. Hire people who know your market. Are your prospects baby boomers? Get a baby boomer to sell your product. Are your prospects military organizations? Hire a veteran. Are your prospects highly educated? Hire someone who went to the same university. Are your prospects people in Alaska? Recruit an Alaskan.
3. Pay commissions on sales. For the most part, great sales people are motivated by commissions because salaries are flat no matter how many you sell, but commissions make the earning opportunity far greater. The harder they work, the more they earn. That’s good for both of you. My top sales people have always made more money than me. It was a very good investment.
4. Find a partner. If you are the expert who bakes the world’s best pies or creates the world’s newest technologies, but sales activity makes your skin crawl, your best sales channel may be a partner who can be the face of the company. As one entrepreneur said about her business partner, “She’s practically the mayor of the city!” The right partner is a wonderful experience. The wrong one can ruin the business. Hands down, entrepreneurial partnerships work best when the partners have the same values, priorities and motivations.
There are more options for sales channels, such as sales agents and direct response, but that’s for another post.
“It all starts with a sale,” the CEO of the largest US construction company told my husband over 30 years ago. And so it does.
All the best,