What you need to know about qualifying.
I’d like to talk to you about qualifying new business leads. So what is qualifying? Qualifying is when we’re looking at working with a potential client, but we want to make sure it’s the right client fit for us. So is it the typical kind of client that we can do the best work for?
Why is qualifying important?
Now, why is that important? Well, often I come across account managers who say that they’re working on a client account that is not profitable or they are high maintenance but don’t really pay very much or they’re just not pleasant to work with. Um, or they, they feel boxed in because they can’t do the work that they could do for this client, but the client sees them in one particular way. So it’s, you know, all in all, it’s not a typical client. Now, what’s the effect of that on business?
What’s the affect of not qualifying the new business opportunity?
Well, the effect can be on staff morale for example. Or it can be on unprofitable business.
So the account teams working with a client where if there are time was better spent on another client, then it could be more profitable.
So there are lots of different ways the wrong client can impact on your agency. Now, it could be that you’ve got to a point where you’re chasing business and so you need new business regardless of what shape it comes in. But really it’s much better to qualify it.
I look at the potential client, decide whether it’s a good fit for you and whether you can do your best work for them, before going ahead with it.
How do you qualify?
So how do you qualify? Well, there are several ways. The first way is to ask yourself some questions and those questions are, if we take on this piece of work, what kind of impact is that gonna have on our existing business?
How much time do we think that it’s going to take? And also, is it the type of work that we want to do? If you are wasting time on looking at new or having business meetings with people and not really looking at the costs, the hidden cost of the agency, of having those meetings, then this calculation might be useful.
If you say that typically you’re looking to increase your revenue for one year by 1 million. For example, if you divide 1 million by how many working days there are in a year, say 270 and then you divide that by eight, because there are eight working hours in a day, then that equates to the cost of the business of you being out of the office for the day at a new business meeting at £462.
The cost to the agency of not qualifying
So if for example, you get a call from a client and you don’t bother to qualify them, and you say, yes we’ve got a new lead, I’m going to go and see them and spend a couple of hours there and I’ll probably come back, I’ll probably write a proposal. All of this time might be wasted. So £462 pounds a day. Typically, if you’re spending on average four days on that new piece of business, then that could be about £2,000. The cost of the agency, not to mention the fact that your time is occupied there and not spending it on more lucrative prospects so to speak. So the cost to the agency of not qualifying the business could be enormous.
The pitch process is then a huge cost
And that’s even before you enter into a pitch process where you’re getting more staff members involved and spending a lot more time on that potential piece of business. So I’m going to send you, first of all, a qualification questionnaire. And this is a series of questions that you can ask yourself before you enter into any kind of request for proposal process. And also when, if you do decide to go for it, then the questions that you can ask the clients.
Are you sure?
One of the things that a lot of my agencies tell me is the client doesn’t make themselves available to answer any questions even though they’ve asked you for a proposal. So in that instance, you’ve got to ask yourself, really, is this the kind of client that we want to work with?
Because you’ve got to make sure that you are solving their problem in order to understand what their business problem is. You’ve got to get in front of them and ask the right questions. So yeah, I’m going to send you a qualifier, a simply a questionnaire when looking at new business prospects, if you do happen to get them to the new business meeting and you want to quickly qualify the client.
The 5 P’s
Sometimes when you’re in that situation, your potential client could be sitting there a little bit like folded arms thinking, Oh, you know, I’m going to see several agencies.
So this agency is bound to whip open their laptop and show me their presentation and talk to them, talk to us about themselves, trying to sell us stuff. So there may be a little bit feeling a bit resistant. So one way you can overcome that is just following the five P’s, verbal upfront agreement process, which is permission, purpose, parties, a pace and pro proceed.
P for Permission
And the way that goes is permission. Always ask permission upfront, ask any questions. So, you know, you could say something like, typically when we meet a new prospect like you were, thank you so much for inviting us. Then we like to get to know the business so that we can identify whether there’s a good fit and whether we can help you. So is it okay if during the meeting I asked you a few questions?
P for Purpose
Perfect. So you’ve got permission to ask questions. Then you want to say the purpose of the meeting. So what, which I’ve just sort of combined with the permission. So the purpose of this meeting is to really understand if we’re the right fit for you and we can solve your problem, but also if you liked the sound of us, is that okay?
P for Parties
Then you go into parties. So from our perspective, this is the roles, my perspective, and your perspective. So from my perspective, what we’re going to be asking you is probably some quite direct questions about your business challenges.
Would that be okay? So then you’re being getting, you’re given permission to ask probing questions. Then you can ask them, is there anything else that you’d like to add to this meeting? Anything else you want to explain before we start?
P for Pace
If they say no, then carry on and say, this is probably gonna take about 25 to 30 minutes.
P for Proceed
And then you can, when you get to the proceed part, you can say, look, if we get to the end of 25 minutes and for whatever reason, one or the other roofers realise that perhaps we’re not a good fit for each other and we can’t help you. Would you be okay if I told you? So that really should disarm them a little bit. They should say, well, they’re not trying to sell anything to me. They’re just making sure that they’re a good fit for my business.
Now, I can’t believe that any potential client wouldn’t think of that as a good thing. And similarly, you could ask them if you decide that you don’t see a good fit working with us, would you feel comfortable just telling me that?
And that just saves everybody a lot of time. So think about a few things.
Always qualify, structure & rehearse your first meeting
Just to wrap up, always qualify any prospective client, use a questionnaire to ask yourself questions and then to qualify the opportunity, and questions for your client before you accept and also structure the first meeting so that you’re both understanding that this could turn into being a client, but not until you’ve both identified whether you can solve their business problem.
I look forward to seeing you at the next video.
