Can a Good Economy Be TOO Good?

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What a difference a few months make. Prior to this past November we were suffering through a down economy that lasted for nearly the entire previous decade. ("Down" is a politically correct term. Actually, the economy was lousy, crummy, miserable — well, you remember.) However, after November everything changed — and quickly. To say that we’ve rebounded would be huge understatement. We are soaring and growing at a rate that most thought impossible just a few short months ago. But, can things really be too good?

Oh no, don’t tell me...

Actually, it is possible that the rapid, upward changes in the economy will cause many businesses serious problems. How is this possible? With increased consumer confidence, wealth and purchasing power comes more sales and income, right? Right! However, it also brings increased competition, and much of the competition will be promoting lowering prices. So while the booming economy may bring increased sales, if you are not prepared, it may also bring lower prices for those sales. What does it matter if prices are lowered, as long as sales are surging? Good question. The answer is that it may matter quite a bit.

Do the math yourself

If you are either forced to lower prices or choose, out of competitive fear, not to offer those higher-priced options and alternatives, you will likely find your average sale prices dropping. That means that you will also be forced to sell quite a lot more of your products or services to break even on your margin projections.

RELATED: Changing the Way to Sell Pools and Spas in a Tough Economy

For instance, lowering prices only 5 percent means that you will be forced to sell 25 percent more to break even on margin dollars. A 10 percent reduction in sale prices will force you to sell 66 2/3 percent more of the same products and services to break even on margin dollars. And it only gets worse from there. Do the math. It is an endlessly losing game.

Some solutions

Good economic times can be almost as challenging as the past bad times when it comes to profit percentages. In any event, it seems clear that salespeople can no longer continue to be cavalier about their chosen profession in sales. You must be willing to change your attitudes, your focus and your approach in competitive situations.

You must become bold in the face of low-balling competition. You need to understand that the newly empowered consumer will purchase value over price — if provided the choice with clarity and confidence. Here are a few tips to help you accomplish this:

Make it all about them. Everything you do in the sales process needs to be centered on them, their wants, needs and desires. Always them. You must believe that what you do — as salespeople, builders and service people — will change the lives of your prospects, customers and clients in a positive way. You can and will improve their lives and the lives of their families — if you make it all about them and provide them with solutions that exceed their expectations.

Ask. Ask. Ask. I believe that if the right questions are asked at the right time, the answers will tell you everything you need to become a customer's first choice. Questions are the answers in selling. Plan your questioning strategies carefully. With practice you will find that they will tell you that they want those higher-end options that so many salespeople are afraid to offer. That’s right: If you ask the right questions, customers will tell you what they want without you even attempting to persuade them.

Listen and react. Listening is an art. In fact, it is an art that many salespeople never really appreciate or fully acquire. For example, you cannot listen attentively if you are thinking about what you’ll be saying next. This is another reason why education and practice are so important for those striving to become professional salespeople.

RELATED: 12 Tips to Boost In-Store Sales

Here’s another tip: If you are asking a reasonable number of well-constructed questions, you won’t be able to recall all of their answers by memory. It won’t happen; so be prepared to record their responses in a highly proficient manner. Yes, even the way you record responses is an art.

Be aware...

...of your true role as salespeople. I mentioned earlier that a change in attitude and focus is necessary when selling in the great new economy in which we suddenly find ourselves. Many of the changes have already been addressed. Here are a few more:

Help them. Stop worrying about selling stuff and begin concentrating on helping customers make the right decisions. Contrary to popular books on the topic, your role is not to persuade or cajole people to buy things they don’t want or need. You are there to help prospects make the right decisions for themselves and their families.

Knowledge is growing exponentially. Technological advancements are happening so fast that almost no one can keep up. The same is happening with your prospects. They are more highly educated than ever before. They enjoy and use the internet to educate themselves about you, your products and services. They often know more about your competition than you do. They expect more. They demand more. They deserve more. They may no longer be patient with the pushy, uneducated salesperson of the past who is interested only in the close, the close, the close.

Consumers want to work with the best salespeople they can find. They want the best products and services that they can afford. It is far more important to them than price. You better start believing it.

Those who continue selling as they have in the past, without regard to the changes happening with consumers and the growing economy, may soon regret it. All it will take is one competitor who changes to a new, dynamic professional approach and consumer expectations will rise to a new and higher level at which many will no longer be able to contend. Become that competitor.

Mario Rossetti has been in business for more than 35 years as a business owner, business consultant and as a director of sales and marketing for international companies. Now, as the founder of Rossetti Enterprises, he offers sales and management training and is a fixture at pool and spa trade shows. To sign up for his free e-newsletter of tips and sales advice, click here.



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