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A Word About Collecting Payment and Closing Deals

Posted on August 27, 2023 by Jason Kanigan

If You Aren't Collecting Payment at the Time of Order, You're More Likely to "Lose the Sale"

Inside an agency owners group I saw a sales discussion in which a number of people said they had problems collecting payment and closing deals. They would think they had “closed the sale” and gotten the order, but when they later sent an invoice, the buyer would ghost them.

Here’s my question in response: Do you have your screen for collecting payment ready when the buyer is ready to buy?

A major block to selling that I see with newer agency founders is that they don’t present this attitude: “It’s normal to buy.”

They’re busy being afraid. They’re afraid this person won’t buy. And the actions they take demonstrate it’s weird, unusual, wrong for someone to buy.

When You Act Like No One Has Been Here Before, They Won't Buy

When you don’t have your method of collecting payment ready, you’re telling your prospect, “Oh, wow—nobody ever got here before! This is strange!” And what do you think the prospect’s emotional reaction to that is? (“Yikes, I’m outta here!”)

My hardcore close, based on 25+ years of experience, is, “So, what do you want to do next?”

When I feel all questions have been taken care of, the prospect has a need for what I offer, a problem large enough to warrant my involvement, and a personality I and my team can work with…then it is natural for them to say something like, “I’d like to buy. How do we get started?” How do I pay you?

And then, instantly, I bring up the payment processing page. It is normal to buy. I have been here a zillion times before. I have been here earlier today. It is normal to buy. Here is the process. People do this. Many people have done it before you.

Make It Normal to Buy

Make this change. If there is a gap between you and collecting the money, get rid of that gap. Collect the money.

I was a credit manager for a national electrical wholesaler for four years around the time I was 30. I collected $2 million a month and got very good at talking to people about the very touchy subject of money. I learned that you must ask for the money, you must be ready to collect the money, and it must feel normal to everyone involved that you are collecting the money.

Are You Presenting Yourself As Someone People Regularly Buy Things From?

Observe how you present yourself and your content on sales calls. Are you nervous? unprepared? unsure?

Everything about what you do needs to express “I have been here before. Many buyers have been here with me before. This is normal. It is normal to buy.”

What changes will you put into action to make this happen?

When I originally posted this in the agency group, fellow member Boyd Trimmell commented: “Failure to collect payment immediately is why so many small service businesses struggle with cash flow.” He is dead right.

The accounting maxim goes: A dollar today is worth more than a dollar tomorrow. The interest rate aka inflation, creating the Time Value of Money concept, makes it so. Add to that if you aren’t collecting payment now it’s less likely that you ever will, and you’ll see the problem clearly: you’re delaying or completely denying that cash your business needs. Cash is the lifeblood of business. If you’re an employee and not an owner, understand this…you are paid by money collected. If you don’t collect, the business will soon run out of cash and you won’t be paid at all. As Stuart Wilde said: “When they show up, bill ’em”.

>> Jason Kanigan is a strategist who works with agency owners to increase the profitabilty and effectiveness of their organizations. Book a consultation with Jason here <<

Why Demos Fail to Sell

Posted on June 2, 2023 by Jason Kanigan

why demos fail to sell, DemoGuy, software demonstration

Why Demos Fail to Sell: A Question

Why do SaaS (Software as a Service) B2B firms make you go through a demo? This was the question on an expert platform I'm a member of. "What's with all the secrecy?" Why not, as is common in the B2C world, simply let the user download the SaaS and use it for a free trial period? Wouldn't that lead to better traction and more paying customers?

The original version of this post was written in October 2014. Recently, a SaaS founder was sharing a list of factors that helped them get over eight figures ($10MM) in revenue this year...and guess what the first item was? "No Free Demo". So that prompted a review of this post. Let's see how things have updated in the past nine years:

"No Free Demo"

Before leaving Canada, I was Business Development Manager of a full service boutique IT firm. One of our main products was for network security. 'Book demos, book demos, book demos' was the direction. The idea was to get people on a call and screenshare appointment with one of our techs. My experience and understanding from then to now leads me to this conclusion:

I don't think it's secrecy. I believe it's bad selling.

"Look at this awesome thing I developed! Surely if you look at it, and I can control the demonstration, I can explain everything about it. Then you'll really want it!"

Sometimes a product or service creator can be fearful someone will "steal" their idea. They have not realized ideas are a dime a dozen: it's execution that is difficult to match! This could lead to the perception of secrecy. But I believe poor understanding of selling is a much more common issue in the SaaS world.

Underlying Reasons Why Demos Fail to Sell

Many products are developed because the creator had an idea. Not because the market told them they needed it, note. This is why so many SaaS startups fail. No need. Then they make up some sort of pricing structure which has no basis in reality and certainly isn't profitable...and then must go out into the marketplace and try to convert people into becoming users. Tough road!

What most salespeople (and people who shouldn't really be in sales, but accidentally fell into the role) fail to understand is that customers rarely buy because of ALL the features your product or service has. They tend to buy because of ONE of these.

Example: the network security product I sold had four main features. But buyers would only be interested in one of them--a different one each time. Only months later, when they came back and asked the now-perceived-as-expert (me), "Gee, we need X...do you know anything that does that?" I could then happily inform them, "What you have now does that already."

Sell first, educate later. Often, putting too many choices or things to think about in front of a prospect will result in overwhelming them. Another example: I'm a producer for a TV network. When we first meet with a prospect, I don't go into everything we can do. I stick to one big idea, and that's what we sell. When I first started in the field, I tried upselling, cross selling, what have you. Nope. All that did was confuse the prospects. Now I sell them on the one big idea...and then come back a little later, now that they're used to working with us, and pick up the other orders I knew would be a good fit following the first discussion.

What to Do Now That You Know Why Demos Fail to Sell

The standard belief is: "If I can just get in front of enough people and tell them about every single feature of my SaaS, I will get lots of customers." And to a degree this is true. If you see enough prospects, you'll accidentally make some sales. But you probably won't truly know why they bought.

The demo is an outdated mode of selling. The assumption that people buy because of features and benefits is false. These salespeople don't know any other way, though. They want you on the call. Live. Then, they believe, they can convert you into a paying user. On your own, as a consumer, you're not to be trusted to come to your own correct conclusions.

As a SaaS developer, what else can you do?

Don't develop your tool in isolation! Don't create something just because you alone believe it would be a good idea.

Ask your target market.

Do the people you're going to be relying upon to be paying customers agree this is a needed solution to a real problem?

What do they want it to be and do?

What size of a problem does it solve for them (pricing and validation hint)?

Do they instantly "get it"? Or do you find yourself mired in the quicksand of attempted explanations and blank looks?

Many, many SaaS startups have tried and crashed and burned because they did not find out the answers to these simple questions before they went ahead and developed their solution. It was a solution to a problem nobody but the creator thought was important.

If you asked these questions before starting development, and got clear responses from your target market, you would be able to create a solution to a real problem...including features your audience has told you they will pay for. Now do you need a demo? Of course not. The sales copy will practically write itself. User adoption will happen like a rising tide. At that point, it's just a matter of letting your market know you and your solution exist.

One final example. I sell a stock trading software currently valued at $5000 (the price is going up!). My discussion with prospects is NEVER about technical issues: I might have to answer one or two little tech questions, but we do not even look at the software. Buyers invest in the software because they understand it will help them make more money. I'll say it again: I have never had to do a demo or show a single screenshot of this software to sell it for $5000.

>> Do you have a question about why demos fail to sell, selling or SaaS? Comment below to let us know! And if this info helped you, please Like or Share to get it in front of others. Jason Kanigan is a profit maximizer for individuals and organizations that competently solve serious problems for well-defined target markets. For more information about Jason, click here. <<

Advice On How To Start a Business

Posted on April 26, 2023 by Jason Kanigan

Some further advice on how to start a business: there is no "one right way". You have to make your own choices. Are there client fields that are likely to give you a better chance for success? Sure. But nothing is guaranteed.

Every business, and I mean every single one, does have a few specific things.

The person asking for advice who prompted this post said they had a budget of $500 for starting their business. Your budget does not matter. Put that money away, use it to pay for living expenses so your business can "stay alive". Don't get distracted by that money.

First you need to choose who you are helping, and what problems you are helping them solve.

These are also called your niche and your offers or services.

No one can pick these for you. There are no magic bullets on how to start a business. If you pick a popular niche, you get a lot of competition. If you pick a niche that not many other people are in, there's probably a reason--like the people in it don't understand why they need marketing help.

How To Start a Business: Picking a Niche

I look for niches with good cash reserves, a quick payment cycle from their customers, a high offer price, and a topic I understand and like. That will make me automatically enthusiastic. It keeps me away from realtors (estate agents), engineering firms and pie sellers and moves me towards trades like electricians and roofers. Can you see why?

Realtors = long payment cycle, they get their money a month from now. Not good. Pie sellers = low offer price, which doesn't support my service cost. Trades = good service price, and they get paid today or close to it.

Now what services can you offer that you're confident in delivering?

A popular agency growth program I represent teaches you how to hire competent subcontractors, so you can find the customers and manage the projects, but these subcontractors actually do the work. And they do it at a lower price than you're charging, if you follow the directions, so you make money.

In the beginning I would not try to offer many services. Do not try to be all things to all people, or take money because it is waved in your direction. Choose one or two things you can get good at.

The Importance of Competencies In How To Start a Business

You need to develop COMPETENCIES in a number of areas to be successful in business. Delivery of services is one of these areas. Others are:

Lead generation
Qualification (sorting leads for the good ones)
Closing (turning some of the qualified leads into buyers)

and as I said above, Fulfillment or delivery of services, so you can give clients what they paid for.

What I said may sound dull but you might be astonished by how few people understand what they're getting into with a business, including an agency business...and how even fewer can explain how they're doing these four things in plain language.

Can you write down in plain language how you are doing each of these four things?

How are you generating leads?

If you can't explain this, I guarantee you do not have a business.

And continue doing this for the other three areas.

Getting Clarity When Starting a Business Is Critical

These are exactly the same things I'd ask you to explain, or or with you to develop, in a paid consultation so you get clarity.

Choose a method, and write it down. Email? LinkedIn messaging? Facebook ads? Phone calls? How are you going about generating leads?

If you can't explain it, you don't know what you're doing or how you're doing it. And if you don't know those things, you sure can't delegate it to someone else.

The agency business is a series of choices. We will work with these people, but not those. We will offer these services, ie. solve these problems, but not others. We will charge prices at this level, thereby solving the problems at this particular magnitude, but not others.

Where I see people struggling with their agency business is in their trouble making these choices. They sit there hoping someone else will give them the "one right way", the magic bullets. No. You have to choose. You must develop those competencies. There aren't many of them, really...less than a half-dozen. And the faster you choose and get to work, the faster you'll develop them.

If you pick a leadgen method, as an example, and after a few weeks determine it isn't working for you, you can erase what you wrote and pick a new approach. If cold email didn't work, you can change it to phone outreach.

How People Lose In Starting a Business

But what I've seen is people giving up on methods without having really tried them. They made four phone calls and say, "Cold calling doesn't work for me". Of course it doesn't! You didn't do it! You didn't develop any competency at it. Or they send 100 emails and give up, saying "Cold emails don't work for me". You can't truthfully say that: you didn't do the work. It takes far more than 100 emails to get anywhere, unless you're lucky.

So understanding the scale of what is required is necessary for success here.

One final thing: I see people get into programs for agency founders and give up. They say they're "overwhelmed" and when I ask them, "Why didn't you talk to a coach?" they tell me: "I didn't know I could do that".

I don't believe you if you say that. You gave up.

And I have to tell you the harsh truth: Giving Up is not the sign of an entrepreneur. If you give up so easily, you're probably not cut out to be a business owner. Sorry if that hurts, but it's the truth. Not everyone should be a business owner.

I have talked to people who didn't do much in a program, but didn't give up and when they spoke to me they decided to keep fighting. That's the sign of a true entrepreneur. Finding things out for themselves. Not taking No for an answer. Not getting "overwhelmed" and saying to themselves, "This is too hard. I'm stopping".

If you will learn, and keep going when the going gets tough, you might be a real business owner.

>> Jason Kanigan is a conversion expert and sales coach. Book a consultation with him here. <<