Bulletin #3013, So You’re in Sales
Home-Based Business Fact Sheet
Adapted for Maine from Iowa by Jim McConnon, Extension business and economics specialist, University of Maine Cooperative Extension.
Table of Contents
- Know yourself and how others view you
- Recognize the importance of the customer
- Overcome employee indifference
- Improve customer relations
- Develop the sales personality
- Home-based business owners represent the business
- Types of selling
- Frequently purchased merchandise
- Comparative shopping
- Less frequently purchased merchandise
- Personal attention
- What is the buying/selling process?
- The Home-Based Business Fact Sheet Series
Chances are good that your home-based business involves making sales. You may even be directly involved as a salesperson.
The goal of selling is to match customers’ needs with merchandise and services. The better the match, the better the sale. If salespeople make a good match, they not only make a sale but have a satisfied customer. They may also have the start of a long-term profitable relationship. Successful selling requires the salesperson to add a personal touch to make the match work. This fact sheet focuses on attitudes, knowledge, and skills helpful to the selling process as well as basic information about the selling process.
How are you and your business viewed by customers and by the community? What the customer perceives to be true is always more important than what is true. Customers act on the basis of their beliefs rather than on what is actually true. So it is vital to know how customers view you and your business, how employees view you as a manager/owner and the image that customers have of your employees. Get opinions from people you serve. What you learn can give you a chance to improve your personal image and the image of your store.
To remain competitive in today’s quickly changing economy, you must be ever alert and make changes to match customer needs and wants. Assessing your image often can help you stay competitive.
A business that views the customer as the most important person is on the path to good selling. Too often, business activities are set up to make things easy for employees rather than for customer satisfaction.
Customers stop shopping at a retail or service business for a many reasons. However, studies show that 68 percent of dissatisfied customers do not return because of the indifferent attitude of an employee. Here are some reasons a customer may see an employee as being indifferent:
- Distasteful dress and untidy appearance
- Inadequate knowledge of a product or service
- Indifferent treatment of customers
- Lack of simple manners and courtesy
- Irritation when asked a lot of questions
- Gazing into space when answering questions
- Failing to show customers the variety of styles available
- Concentrating solely on current customers and paying no attention to newly arrived customers
- Ignoring customers to perform stock and display duties
- Visiting with other sales clerks rather than offering to assist customers
- Hovering over a customer when the customer wants to browse
Marketing data show that it costs five times more to gain a new customer as it does to keep an existing one. Employee indifference can be very costly to a firm. Good sales result from a carefully developed program that includes training salespeople in selling skills. The ability to sell can also be self-taught with on-the-job practice.
Customer relations become more important as rapid changes in transportation and communication shift customers’ shopping patterns. Your customers know what is available elsewhere. They may know other locations, and they may be willing to travel far for a bargain.
Today’s customers are better educated and more discriminating. While economic conditions have made people more willing to try new products and services, they have also made people more concerned about getting the most for their dollar.
Customers’ tastes and preferences, and business competition, are always changing. Firms that fail to keep up with changing trends miss sales opportunities. Adapting to needs and wants of customers may mean you’ll have to stay open at hours that are more convenient for the customer. Or you may need to offer a wider variety of goods and services to attract customers.
Good customer relations demand that you really care about helping people. To succeed in selling, you must be tuned into people. When you really care about helping people, it shows in how you relate to your customers, in your courtesy, and in your personal appearance, work habits and enthusiasm.
We’ve all done business with a salesperson who seems to have a knack for selling. It is true that many salespeople tend to be extroverted. Usually, an extrovert finds it easier to approach new customers with confidence. But, having extroverted traits does not always mean selling success. Studies show that customers prefer to buy from someone who has a personality like their own. For example, a reserved, shy customer may feel intimidated by an extroverted, aggressive salesperson. She or he may avoid contact and tend to “look around.” Successful salespeople adapt to the different personalities of customers.
In many instances, the home-based business owners acts as a salesperson and represents the business to the customer in three very important ways:
- As an information source. The salesperson is knowledgeable about the businesses’ products and policies.
- As a public relations representative. The salesperson represents the business to the public and to customers.
- As a seller. The salesperson helps the customer decide what to buy.
The knowledge and skills you need to be a good at selling things depends on the type of products or service you’re selling. Not all sales jobs are alike.
Some businesses hire employees just to ring up sales at the cash register. These employees are not as actively involved in the buying/selling process. Other people are hired to work directly with the merchandise and are much more involved in selling.
Products like food, drugs, gas, etc., are purchased often. The customer wants to buy these things where it is convenient and requires little effort. The salesperson’s role is mainly to help with their purchase. He or she doesn’t enter into the buying/selling process as much as in other types of selling. But courteous, attentive service is still important. It helps customers to feel like more than just a “number” being run through the check-out line.
Purchases of clothing, home furnishings, sporting goods, housewares, tires and similar items usually involve more thought and shopping effort on the part of the customer. For these items, the customer wants a salesperson who has a good product knowledge and can offer advice on using a product. Good selling for these items also requires an awareness of why people buy what they do and what they may be thinking as they look at the product.
Selling is hardest for specialty goods, such as major appliances, furniture, furs, costly clothing and jewelry, cameras, etc. Customers are likely to make many comparisons before they buy. Many of these items are once-in-a-lifetime purchases. Customers expect the salesperson to have in-depth knowledge about the product. Brand name merchandise is important in these sales, but customer confidence in the salesperson is also a very important factor.
Many customers prefer the self-service type of selling offered in stores today. This allows customers to meet their needs very efficiently. However, it can frustrate people if there are no clerks available to help them find what they are looking for.
Some customers demand personal attention and service. They are interested in advice and want to see a demonstration of a product. Having well-trained salespeople available to do this will complete sales that began with other sales promotion activities, such as displays and advertising. Personal attention allows you to suggest they buy additional merchandise which can lead to extra sales.
Many people have tried to list the steps of the buying/selling process. Yet no list can capture the elements of every buying/selling situation. What a list can do, however, is identify a pattern that emerges when customers and salespeople meet.
The buying process is a series of more or less orderly steps leading to action. A prospective customer first becomes conscious of a need or want, seeks a means of satisfying it, arrives at what seems to be the best solution and is ready to exchange money for a chosen good or service.
Successful sales are based on easy-to-apply rules that can be learned. Steps in the selling process are not always taken in the same order. Nor does each one need to be taken with every customer. However, understanding the basis for the buying/selling process and having an enthusiastic approach can help you sharpen your selling skills.
1. Know your merchandise.
Product knowledge has been described as the rock on which all successful selling techniques are based. It is the salesperson’s job to know features of the merchandise so he or she can point out features that will meet customer needs. Sources of information about products include hangtags, displays, store signs, product literature and trade magazines.
You must have a thorough knowledge of products you sell and also know where merchandise is located, when it is on sale or out of stock and when shipments of special merchandise are scheduled to come in. A quick check of the store each day will help determine what changes have taken place and identify out-of-stock items, incoming shipments and special items that are on sale.
2. Approach the customer properly.
First impressions count most. The first 10 seconds of the retail selling process can often make or break the sale. The main objective should always be to make the customer feel welcome and comfortable.
The best icebreaker is a sincere smile. Customers can tell immediately whether or not you are really interested in helping them. Approach the customer in a way best suited to the situation. The merchandise, neighbor, or knowledge approach are all excellent ways to start a dialogue with the customer.
The merchandise approach lets you focus on the item the customer is examining and ask open-ended questions to find out more about a customer’s needs. This opens the door to an exchange of information between salesperson and customer.
The neighbor approach, using general comments about current events, or the weather, is a natural greeting for some salespeople.
Others prefer the knowledge approach, volunteering more information about a product the customer is examining, as a way to open a successful sales dialogue.
In the approach step of the selling process, use a greeting that is courteous, short and affirmative. Be sure that the customer knows that you are there to serve, rather than sell. Make the customer feel welcome and comfortable. Ask questions that clarify why the customer is looking at the product. “Is this for you?” or “Is this a gift?”
As a competitive advantage, courtesy is hard to beat, and few things are more discourteous than keeping a customer waiting. Remember that successful selling depends on effective communication between salespeople and customers. The approach is important because it is the first stage in this communication process.
3. Discover the customer’s wants and needs.
One of the most important steps in successful selling is finding out what the customer’s needs and interests are and then showing them the right merchandise.
Not too many years ago, the motive for nearly every purchase was need. There was an actual need for the good or service. However, as personal incomes increased, more purchases became related to individual wants rather than needs. Goods or services gratify buying motives, such as a desire for social approval, pleasure, variety, curiosity, fear, comfort, security, safety, freedom from worry, convenience or love. Customers are concerned about how the products or merchandise can help them live easier or better, or grow taller, bigger or thinner. They want to do something cheaper, faster and with less effort.
For example, the customer who is looking for jogging shoes may be concerned about their price, quality, cushioning effect, weight, support, etc. Or they may be concerned only about appearance and what’s selling well. The task of the salesperson is to recognize the buying motive, whether it be a want or need, and to offer merchandise that will satisfy this motive.
Techniques to discover customer wants and needs rely heavily on asking questions and listening. Questions should be open-ended, rather than those that can be answered “yes” or “no.” Probing questions will help clarify things for the customer and the salesperson, and also show customers that you are interested.
Restating in your own words what you think the customer said will help to check your listening skills. Be aware of messages of impatience, irritation and uncertainty that your customer communicates through body language. Remember, you are trying to find out what customers want, then help them to get it.
4. Emphasize product benefits, then features.
After finding customer wants and needs and merchandise that fits, the effective salesperson will emphasize product benefits. People seldom buy things for the product itself. Instead, they buy the product for it’s benefits, or what it can do for them.
Product features are qualities and characteristics of the merchandise. Benefits satisfy buying motives such as approval, convenience, safety and pleasure. Features are important. A porcelainized enamel surface is easy to clean; an automatic cutoff switch makes the product safer to operate; guarantees and warranties are important features of products that may require service; the materials used may add durability and reliability. However, the benefits of saving time, safety and worry-free maintenance agreements are what are most important to the customer. So whatever you are selling and wherever you are selling, mention the benefits first. Customers buy benefits.
5. Help customers decide what to buy.
Sales resistance is the customer’s normal way of weighing a product’s value. In buying your product or service, the customer is giving up the option to buy other things with that same amount of money. All sales involve striking a balance between price and value. Customer objections are a natural way of slowing down the selling process until the customer is convinced that value equals price. Your customer is usually seeking confirmation that their need truly exists, that your product is the best solution and that your product will be worth the cost.
Objections may really be only a desire to justify a purchase or a sign that the customer needs to know more about the product. A useful technique is to ask a question that will identify the cause of the objection: “Why do you feel this way?”
Remember that decisions to buy presume a balance between cost and value. The salesperson must build the value side with selling points. You must reassure the customer that the product will provide the benefits that he or she needs.
6. Close the sale.
Closing the sale is considered by many people to be the most difficult of all the selling steps. However, if you have successfully moved your prospect through the first five steps, closing the sale is a natural step. Here are some suggestions.
One effective technique is to assume that the customer will make the purchase and simply ask for the order. Offering the customer a choice can also be an effective method for closing, such as “Cash or charge?” “The red one or the blue?” “Shall we deliver this on Tuesday or Friday?”.
Other techniques are pointing out advantages of buying now rather than later, summing up the product’s benefits and features or using testimonials: “This item was the buy-of-the-month selection in last month’s Style magazine.”
When to start closing the sale is not always clear. Many salespeople are afraid to ask for the order too soon. Actually, this is less dangerous than asking too late. So watch for buying signals, customer reaction, comments and questions, then ask for the order.
7. Suggest additional complementary merchandise or services.
This can mean extra business, but it is a sales technique that must be handled carefully. Timing is important and must be based on your good judgment. A good general rule is to complete the first sale before calling attention to other merchandise or services. However, since your primary purpose in the selling process is to produce customer satisfaction, helping your customer to fill additional needs is an important step.
There are many logical reasons to note other goods and services. Many items require attachments and accessories to get full use from them. Also, it may be economical to buy in quantity. Customers like having seasonal merchandise. Your suggestions may uncover forgotten needs, save your customers time and money and, above all, add to their satisfaction with the original sale. Remember, however, to tie the sale of the extra merchandise to your customer’s wants and needs.
You can learn to be a salesperson. A basic understanding of the seven steps outlined above, a desire to be successful in your sales role, plus an enthusiastic attitude can go a long way toward increasing the sales of your business.
Remember these steps:
- Know your merchandise.
- Approach the customer properly.
- Discover customer wants and needs.
- Emphasize product benefits, then features.
- Help customers decide what to buy.
- Close the sale.
- Suggest additional complementary merchandise or services.
This is one of a series of publications designed for the person entering or considering a new business operation. See the University of Maine Cooperative Extension Online Publications Catalog for the complete Home-Based Business fact sheet series.
Information in this publication is provided purely for educational purposes. No responsibility is assumed for any problems associated with the use of products or services mentioned. No endorsement of products or companies is intended, nor is criticism of unnamed products or companies implied.
© 2001, 2008
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