Hey folks, Phil Zito here and welcome back. In today's post, we're going to be talking about sales.
Now, I know a lot of you have messaged me, and the general gist is, “Phil, why do I even have to think about sales? Why do I need to be focusing on enhancing my sales skills right now because literally, I can just close my eyes, stick my arm out, swing in a circle, and I will run into a sales opportunity?”
There are more sales right now to be had than there are people out there to execute and people to sell. So, why do I need to think about this, Phil? Well, there's this little thing called inflation, and there is this thing called a recession. The reality is, I've lived through 2008, I've lived through COVID, I've seen their effects on the market. I've seen how it caused people to contract their budgets and affected the ability of people to bring in business.
So, what I want to talk about is when this contraction happens, or when people start tightening their purse strings, and not necessarily buying as much, how are you going to identify sales opportunities? The markets going to get crowded, there's going to be a lot of people out there trying to sell, and you're sitting there trying to get them to pay attention to you. So, what can you do?
To start, let's bring people free money. Now, I'm not going to get into the politics of this, I'm not even going to touch that, but the reality is, when things slow down, the government likes to give out money, it just is what it is. So, if you are able to identify sources of said money, and transfer that to someone who is needing to do a project, or wanting to retrofit, or wanting to improve something, well, guess what my friends, that is going to bring you to the front of the line in the sales world.
#1 - Have a Sales Tool Belt
So, tip number one, you should have a sales tool belt, alright. The sales tool belt should be filled with all kinds of sales tools, you should have prospecting tools, you should have financial tools, you should have industry-specific tools, you should have ability to do problem solving tools, you should have technical acumen tools. You pull out these tools, as needed, when you're selling.
So, maybe you're sitting there and you're running into someone who is trying to purchase something, or to enhance their building automation system, but they don't have money. That's where that tip number one comes into play, right, you can draw from the potential resources that exist in the market to fund projects.
#2 – Staff Optimization/Energy Optimization
Tip number two is being able to understand the fact that utility prices are increasing, staff expertise is decreasing, people are leaving the workforce, people are retiring. So, there is kind of a combination of there's less experienced staff to run and operate buildings, while there's also an increased cost to operate buildings. So, having the ability to mitigate those through technology solutions, is going to be able to help you identify sales opportunities.
Here's what's going to happen. A lot of people are going to reach out to their mechanicals and say, “Hey, you bidding on anything,” or they're going to go into dodge leads, or they're going to just look at what capital projects are funded, and that is what everyone is going to be going after. They're all going to be going after the same pie.
That's why, in my opinion, actually when the market starts to contract, commercial real estate is probably going to be one of the worst markets to do these strategies in because in their leases, they usually have clauses that pass through the cost of utilities. So, if utility costs increased, they can usually transfer those through in their leases. But, if you have a K-12 scenario or a public healthcare scenario, they typically have fixed costs.
So, you will see that the operational costs increase, the operational expertise decreases, and you will see that people are looking for opportunities to solve both of those problems. As a building automation provider, we can definitely solve both of those problems. You can provide solutions that are OpEx based, not capital based. These are things like analytics, retro commissioning, and retrofits that can decrease energy. Or, you can optimize their staff through training, automation, analytics, work order management, etc. These are solutions you can bring to them, that will hit that staff optimization. So, you have staff optimization, or you have potential energy optimization, you can do either of those. So that's tip number two.
#3 – The Circle Method
Tip number three, to identify sales opportunities in a crowded market, is to use the circle method. So, pick your distance, start at the epicenter of your metropolitan area, and then just draw a circle out that's maybe 20 miles, 10 miles, 15 miles out from the center of the city. The further you go out, yes, the fewer opportunities there will be, but there will be less competition. I usually tend to find that 15 to 20 miles outside the metroplex, in a circular pattern is going to give you the best results.
You're still going to have enough, in most large metropolitan areas, density, as far as the number of companies, the amount of potential customers, but you're going to be far enough away from the core metropolitan area that your competition is going to be less.
So, these are folks that oftentimes, are going to have smaller budgets, but there's going to be less competition for the budgets. The procurement folks tend to be more forgiving of procurement sole-sourcing providers. You can go to these folks and you can do a double whammy, which is a retrofit sale followed by a service sale.
So, you can go to them and say, “Hey, let's take a look at your existing systems. Let's understand your goals. Are you having climate issues? Are you having energy issues? What issues are you having? Let's address those and then let's put in a maintenance plan to maintain your systems.”
Once again, focusing in on OpEx because people aren't going to have CapEx. They're not going to have capital expenditure budget, but they will have OpEx budget.
#4 – Implement Remote Strategies
Now let's talk about things like remote operation centers, remote analytics, remote operating, remote service, etc. Implement remote strategies. These are lower cost, higher leverage activities. So, what that means is, if I were to send a technician out to a site, yes, I may get three-to-four-hour billing, minimum. The problem with that is, is that while I may get that three- or four-hour minimum bill out, what I'm not getting is any ability to multitask that person. That person is out on that job site, and they are committed to that job site. Also, I've lost anywhere from 20 minutes to an hour of travel time for this person having to travel. You may say to yourself, well we’re billing out while he's traveling, but even though you're billing out, once again, that person is a sunk resource.
Now, flip that around and do a remote operation. So, you set up a remote gateway on these customer sites, and maybe you give them a discounted rate if they agree to be remotely monitored. So, you remotely monitor them, you remotely service them, you're going to be able to fix a lot of things just doing that. Between a customer with their phone camera, and you remotely logging into a system, you can diagnose a lot of issues.
Now, what does this do? Well, the likelihood of you being utilized and being committed to a specific person decreases, because you can often remotely fix things much faster. Additionally, there's no travel time. So, now you've taken this one person who maybe could get two calls in a day, now you've taken that one person, and you've turned it to where they could potentially get four to eight calls in a day.
Additionally, you can also tie this to a more passive income, which is a monitoring-based income, where it's almost like insurance, they're paying you to monitor the system. So, that is another sales opportunity in a crowded market that people aren't necessarily going to be addressing.
#5 – Combine Technology Sets in Integrated Use Cases
Now, number five, is looking at enhancing the customers’ ability to operate their building by combining technology sets in integrated use cases. Wow, that's a mouthful. Essentially, what you do is you go to K-12, healthcare, commercial real estate, higher ed, whatever, they all have specific use cases they want to achieve. They have specific things they want to achieve with their technology stack, and your goal is to be able to tie those technologies together at a low-cost amount to reduce the amount of double work they have to do.
So, the previous tip, tip number four was eliminating the aspect of us having to commit resources to a single thing and not being able to commit that resource to another thing. Well now, we're doing that for our customers, we're eliminating the need for them to have a lighting guy, an AV guy, a BAS guy. Instead, by having an integrated use case, that enables the customer to run their facilities with less staff, and with less, basically, operational costs.
So, how do you do all of this? Well, that's where we have to draw from our tool belt. So, I just give you some tips for your tool belt, but now to draw from your tool belt, you want to draw on both financial, technical, and operational acumen.
So, from a financial perspective, we want to be able to understand the concept of ROI, return on investment, we want to understand first cost and ongoing cost, and we want to be able to essentially show the return on the investment based on saying, “This is first cost, this is our continued cost, and this is our savings. We have simple payback at x number of years.”
So, being able to do these equations and show people, here's your operational cost right now. This is your reduced operational cost. This is the difference. This is going to generate x amount of savings, it costs y, and so you'll have a payback in z. Then we go and do that calculation. That is using your financial tools in your tool belt to sell.
Then we have our operational tools in our tool belt. This is understanding building operations. This is understanding how people work, how people run their operations, finding inefficiencies, and then being able to solve those inefficiencies either with technology or with augmented service. Then, show you're able to have a conversation and a sale from an operational credibility perspective.
So, we talked about financial, we talked about operational, and another kind of tool in your tool belt that you want to be able to do, besides the operational and the financial, is kind of having that subject matter expertise. Understanding the business problems that that market has, being able to communicate in that way as well.
Over the next several posts, we're going to focus in even more specifically. We're going to go through kind of researching customers and we'll just pick random sites and see if we can't find their operational budget, see if we can't find any company reports that go through problems they're facing, and challenges and threats they're aware of. Then we'll also see if we can't research any like, utility grant money or economic development grant money, to see if we can't help fund things for customers. I’ll provide visual resources with these posts as well so you can see what we’re actually doing.
As always, if you have any questions, do not hesitate to reach out. Thanks a ton and take care.