Sales and Sales Management Blog

December 27, 2012

Make It Easy for Your Client to Give You Top Quality Referrals

Are you finding that you’re just not getting the number of quality referrals you want from your clients? Chances are you said yes because that’s the case with most sellers. Oh, sure, we all have some clients that will give us referrals all day long. Just ask and they’ll give you name after name. Other clients, the majority, aren’t nearly as generous with their referrals.

The biggest problem in both cases is so often the referral we get isn’t much better than pointing at a name in the phonebook at random.

How can you guarantee that you get great referrals? Simple. Make sure the client gives you a great referral by finding the referral for them to give you, rather than relying on them coming up with a quality referral to give.

The reality is that clients really don’t know who we’re looking for and most of them just don’t have a real incentive to invest the time and energy to come up with a great referral for us.

But we know who is a great referral for us. And certainly we’re willing to invest the time and energy to find a great referral (if we’re not, we have some real serious issues to deal with).

Since we’re the one with the need; and we’re the one with the desire; and we’re the one who knows who makes a good referral for us, why would we rely on anyone else other than our self to come up with the referral?

So how can we come up with the referral for our client to give us?

Here are three steps to guaranteeing you get great referrals from your clients:

  1. Get Your Client On-board to Give Referrals. Most sellers wait until after the sale has been completed before they bring up the idea of referrals. Bad idea.

    Most clients need time to get comfortable with the idea of giving referrals, so bring up referrals early in the relationship. Don’t ask for referrals; just let your client know that your business is built on referrals and then drop referral seeds as the sale progresses. Since your prospects and clients aren’t stupid, if they hear you mention referrals often in a casual manner, they’ll get the impression referrals are important to you and they will be expecting you to ask for them at some point.

  2. Find Out Who Your Client Knows. We’ve already established that in order to get great referrals you have to do the work for your client, so do it by discovering during the course of the relationship who they know that you know you want to be referred to.

    How do you find out? Through small-talk (who do they mention in conversation they know); paying attention to what’s in their environment (pictures, association directories, membership plaques, and such); their background (where did they work previously); their work (what vendors and suppliers do they interact with). Your job is to be a detective and to uncover the relationships they have with people or companies that you know you want to be referred to. The more you uncover the more quality referrals you uncover.

  3. Don’t Ask for Referrals, Ask for THE Referral. Now when it comes time to ask for referrals, you’re not going to be like every other seller and ask a weak question such as, “Donna, do you happen to know anyone else (or another company) that might be able to use my products or services (or that I can help—or any other such weak question)?”

    Instead you’re going to ask for a specific referral: “Donna, I’ve been trying to connect with David Jones for some time without success. You mentioned that you’ve worked with David for several years, would you be comfortable introducing me to him?” You know she knows David. You have reason to believe David is a good prospect for you. Don’t waste Donna’s time with that weak general referral question; ask to get connected to a person you know she knows that you know you want to connect with.

Referrals can be the foundation of your sales business if you just develop the skills necessary to be a referral-based salesperson. If Donna knows three people or companies you know you want to be referred to and you can get introductions to them from her, how much time and energy have you saved getting those three introductions through referrals instead of cold calling or sending out direct mail or hoping to bump into them at a networking event?

Forget what you’ve been taught about asking for referrals. Referral generation is a PROACTIVE process where you do the work, not your client. Your client doesn’t have the motivation, you do. They don’t have the understanding of who makes a good referral like you do. Your client doesn’t have the time to invest in figuring out a good referral like you do. It’s your business, not theirs. Make it easy to give quality referrals—you’ll get a ton of them if you do.

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December 7, 2012

Guest Article: “How to Build Your Credit Rating,” by Chrissy Hoey

Filed under: Uncategorized — Paul McCord @ 10:23 am

Another in a series arimed at helping sellers get their lives back on track as the economy slowly improves.

 

How To Build Your Credit Rating
by Chrissy Hoey

The creditworthiness of an individual is determined by a number of factors, including age, address, employment status and income. These factors combine to form a numerical score of each individual, but to establish a person’s creditworthiness in full requires a deeper analysis of their financial affairs.

Lenders examine various other factors to calculate the risk of lending to an individual. The greater the risk, the lower the score. People with an excellent credit rating, therefore, tend to be considered low-risk borrowers, but creditors also place value in known quantities, which is why young people who have never before secured credit sometimes have lower credit scores than those who have encountered debt problems in the past.

Regardless of whether a person has a chequered credit history or no credit history at all, building a credit rating from the bottom requires a considerable amount of time, patience and planning.

No credit history

School and college leavers might struggle to open a bank account in today’s economy, let alone find abundant sources of available credit. Lenders have had to tighten their lending criteria following the credit crunch of 2008, so obtaining loans, mortgages and credit cards is no longer easy. Assuming that a young person is able to open a bank account, they will normally be required to spend several months in employment before they qualify for basic credit services, such as an overdraft. Student accounts are somewhat different, not least because banks gamble on students’ ability to repay loans and overdrafts on graduation.

To build a credit history from scratch, an individual should demonstrate an ability to manage their finances in a way that might be considered sensible and responsible. If possible, the individual should save a large proportion of their weekly or monthly earnings. Adopting self-discipline and financial responsibility at an early age can produce dividends later in life. Crucially, this can also encourage lenders to offer credit to those whose creditworthiness has yet to be established.

Obtaining a high-interest, low-limit credit card can be useful if the borrower always makes repayments on time. One strategy for building a credit rating is to make several purchases on the credit card, paying off the balance in several monthly instalments. After a short period, the individual’s credit rating will begin to improve.

Purchasing a mobile phone on contract can achieve the same result. Provided that monthly payments are affordable, the contract should produce further evidence of an individual’s ability to honour a credit agreement. Eventually, an individual will be able to add other credit services to their profile, to further improve their credit rating. Store accounts, loans and hire-purchase agreements can all help to build a good credit profile; if repayments are made on time without exception (even one late payment can stall the progress of a person’s credit rating for several months).

Active credit accounts are considered more valuable than closed accounts (at least to the majority of credit reference agencies), but too many active accounts or too much personal or household debt can further limit an individual’s creditworthiness. The aim of building a credit profile from scratch is to obtain less desirable credit (assuming the applicant has average wealth and income) in the short term, clear all debts early and then apply for credit on better interest terms. Debt should not be allowed to swell during this process.

Poor credit history

As noted above, a person who has experienced debt problems in the past may start from the same position as a person who has no credit history at all. Much depends on the circumstances. If, for example, a person has outstanding defaults or is currently bankrupt, they cannot expect their credit rating to improve in the near future and they will be treated less favourably by lenders, than a young person applying for their first loan or credit card.

People who have a history of debt problems must tackle any outstanding arrears as a matter of urgency. Negotiating repayment terms with creditors is a step in the right direction, so a debt management plan or consolidation loan should be considered, to ensure that the situation does not worsen. History of bad debt can stay on a credit profile for numerous years, so patience is required. Eventually, a credit rating can be improved.

Chrissy Hoey is with Baines and Ernst, a credit management company in the UK.

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