Dealing with your own perception of selling in order to sell your services firm

Cogs cropped 2 - Six key principles

This week we have a guest blog from Lars Tewes, MD of SBR Consulting. SBR Consulting is a sales transformation consultancy that works closely with consultancy owners to increase revenue by liberating sales potential within their practices.

Many consultancy owners start out as specialists in their fields, yet when they set up a business their responsibilities change. In order to ensure the growth of the company, they need to be involved in the sales side. Whether it is being the main person responsible for winning business or overseeing the consultants, this is an uncomfortable step as they often do not see themselves or their consultants (billable deliverers) as salespeople. Let’s look at how this may be affecting your business and how to overcome this prohibitor.

When we’re born, we don’t have any perception of sales but then something happens! Many of us experience bad selling tactics: a salesperson attempts to convince you to buy something you don’t want, being pitched when you’re not even the right person to talk to, being lied to about the facts needed to make a decision; talking at you without listening to what you want, etc. Equally, there are impressionable films depicting salespeople in their worst state of money-making greed such as, “Wolf of Wall Street” and “Glengarry Glen Ross”. You turn on the TV and see comedians caricaturing a salesperson as looking in the mirror and saying things like, “I’m a tiger!” We watch programmes like “The Apprentice” which seem to bizarrely endorse forceful selling tactics and unrealistically high-pressure environments.

I’d best stop before it becomes too negative, but think about it, if these are the pictures and impressions you have been indoctrinated with about sales, no wonder you or your team of consultants have bad feelings about having to “sell” or motivating your people to sell. The truth is that tragically most salespeople do not sell well but that does not mean the “selling profession” is all bad. So, whether you are asking your technical specialists to sell or you are selling yourself, you might be experiencing inner resistance because of this negative view of salespeople. It sometimes hides itself in the form of “I do not have time for business development,” which is rational but extremely illogical. You do not say this when asked to complete a technical project, you find a way to make it happen! What is fact however, is that every profession, not only the sales profession, has its unethical individuals. What is also fact is that every profession has its inspirational, trustworthy and caring individuals.

To help you change your view of what selling is, we define professional selling in the consultative arena by using the acronym S.K.I.L.L. ©

Selling is a partnership experience:

  • Partnerships are rarely built overnight. Someone may not be ready to buy from you today but by building the right relationships over time, you may be the ideal partner when the time comes.

Knowledgeable:

  • Keep building your knowledge around your value proposition, service, market trends, competition and most importantly clients. It will differentiate you and ensure your conversations are always valuable for prospects.

Individual relationships

  • Consultancy is a people business. You need to make building new relationships part of your job. Attend industry association events and form the habit and discipline of keeping in touch with your network even if just for coffee. They will appreciate it and want to work with you when the time is right.

Listen and add value

  • Become comfortable asking the right questions. Listen and add value by helping the prospective client understand their situation better. As a consultant you always did it. You’re just now doing it before the sale is made! This applies to existing clients too as there will be many opportunities you are not aware of where you could add value.

Liberate your own sales potential

  • Become proud of selling professionally. Stop linking the whole of the sales profession with the bad practices you have experienced. We can all be really effective at professional selling if we decide it’s about establishing trusted relationships and partnerships where both parties benefit and would be happy to act as a reference.

Try it! Decide to change your personal view of selling by tapping into our definition of selling – SKILL©. You’ll find yourself in healthy business development discussions. You’ll start to pick up the phone and call people you have been meaning to call for the past year for a coffee. As one recent CEO client expressed; “I’m looking forward to my new world of business development as I am knowledgeable about my market sector and all our clients to date have seen real RoI. I just need to get back out there.”

© SBR Consulting 2015. All rights reserved www.sbrconsulting.com

Are you a member of Equiteq Edge? It’s full of content to help consulting firm owners prepare for sale and sell their business. Register here to gain full access.

Growing equity value webinar series: Market proposition

Close up of businessman holding graph in palms

Lately, we’ve been running a series of free 30-minute webinars to help attendees grow the equity value in their consultancy firms and prepare for a sale of their business. Attendees at each webinar submit questions, and we’re going to be sharing and answering these questions in a series of blog posts. This week we’re looking at the questions asked during the webinar on what you need to know to attract the right clients and buyers.

1. How would a specialized consultancy firm, such as a law firm, go about quantifying its unique value proposition (UVP)?

The UVP has to answer the question ‘why should I buy from you?’ so start thinking about ways you’re differentiated from your competitors along industry, geography and services lines. In terms of industry, perhaps you focus on one or two industries and are recognised experts in say, construction law, or oil & gas exploration. In terms of your geography perhaps you’re able to offer international clients representation in their major jurisdictions. And in the case of your services think about what might set you apart, perhaps you use technology to automate low value-add services so that your clients pay Lawyers for the work only they can do, or perhaps your firm offers a flexible fee structure, or ‘subscription pricing’ for a steady stream of work, or even fixed fees when you know you can leverage your own IP and juniors while still maintaining quality.

As to quantification, think about the way a prospect can relate to the benefits and therefore what kind of quantification is meaningful. What’s the pain point that gives rise to the need for your service, and how will that situation be improved by using your services? List out all the benefits, quantitative and qualitative then get some feedback from your current clients about the relative priorities. And on that point, the process for developing a UVP should start by looking at what you’ve successfully sold in the past, then inviting your clients to give you the unvarnished truth about why they chose you and the benefits they received. And if that conversation isn’t as comfortable as you’d like, well, all the more reason to do the exercise!

You can read more about the power of a UVP for consulting firms here.

2. When looking to attract new clients, is it better to emphasize the benefit of the services provided or demonstrate the firm’s technical competence?

While doing both is important in the sales process, it is important to prioritize the emphasis on the benefit of the services when speaking to prospects because you will have plenty of time to demonstrate your technical competence at a later stage in the process. When approaching potential clients, they are very interested in finding out the benefits of using your products and services as opposed to your competitors.

So, you must first outline the benefits of your services to clients, and then reassure them that you have the technical competence to deliver these outcomes.

3. Should we have a UVP for each service offering or just one for the whole company?

We advise you to do both. You need to have an overarching UVP for the company and then one for each service you offer. This is because there is a process of attracting, nurturing and converting prospects, which move from the broader lens of the firm, and zooms in on the individual services your firm provides.

For more information on why it is important to focus on clients with the specific needs your UVP addresses, read our blog on the importance of focus for consultancy success.

Finally, as with all of our webinars in this series, our key takeout is presented in our Start, Stop and Continue strategies. To immediately improve your market proposition in your consultancy:

Start: Explain in three jargon-free sentences what you do, and the benefits you deliver

Stop: Putting your technical expertise at the start of your sales messages

Continue: Creating content that showcases the benefits of your services (e.g. videos, articles, case studies)

To sign up to listen to a recording of this webinar, please click here. To view other webinars in the series, please click here.

Are you a member of Equiteq Edge? It’s full of content to help consulting firm owners prepare for sale and sell their business. Register here to gain full access.

Case study: Improving value and advising on successful sale for GIA

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Background

GIA, a world leader in customized market intelligence, serves companies whose decision-makers need a solid market understanding in order to grow and compete internationally.

With the support of our Equiteq growth programme, they had already increased their equity value by more than 250% in a 12-month period which ultimately culminated in us being appointed as lead M&A advisor on their eventual sale to M-Brain Oy.

The client’s situation

GIA had achieved good revenue growth and geographical expansion across the world; however their profitability history had been erratic, affecting their attractiveness to potential acquirers in the past.

Our approach

Our approach was to run intensive value-enhancement workshops in London and Helsinki to calculate the current valuation of GIA and then design an action plan to improve that valuation.

We formulated a plan which would increase the valuation of GIA by more than 100% by identifying unnecessary overheads and removing non-value-adding expenditure and encouraging each senior member of the team to commit to improved sales over a period of 12 months. Once the improvement plan was underway, we began our arrangement for sale.

How did this deliver value to the client?

During the process, GIA improved their EBITDA margin to greater than 15% and we were able to demonstrate to potential acquirers that these profit improvements were permanent, resulting in a much stronger valuation proposition.

  • We ran a comprehensive global marketing process, comprising approximately 80 buyers, which garnered significant interest in the business with more than 30% signing NDAs and taking the information memorandum
  • In a competitive process the final sale price achieved was significantly above the target valuation

GIA recognized our efforts in the sale and the performance improvement as critical to achieving the result. All shareholders, including the private equity house, were delighted with the result.

To read some of our other case studies, please click here.

Are you a member of Equiteq Edge? It’s full of content to help consulting firm owners grow and realize equity value in their business.  Register here to gain full access. 

Eight mistakes to avoid when building a sale-ready business

Eight mistakes when building a sale-ready business

Over the years, Equiteq has worked with many entrepreneurial owners of consulting firms to help them grow value and sell their businesses. However, from experience we see that only a fraction of consultancies grow to a saleable scale. In this blog, we’ll explore some of the mistakes leaders make that affect their success.

  1. Working IN, not ON the business – Particularly for early stage firms below $5m revenue size, this is a common reason why businesses fail to scale. Business owners should recognize whether they are spending too much time delivering for clients, as opposed to delegating and working to lead the growth of the business.
  1. Innovation distractions – Ultra-entrepreneurial leaders can get into the habit of spotting new ideas and innovations that promise to bring in millions to their firms, but often just suck resources out of the core business. Think: Will this new idea add leverage to the core service? Will potential buyers be interested in these assets together or is it worth considering launching a separate venture that does not distract?
  1. Value negative diversification – It is important to scale up while also remaining attractive to potential buyers. Diversifying and growing into different markets or verticals can dilute the focus of the company and its niche. Because buyers are often interested in specialized firms, business leaders should contemplate whether the company’s focus is spread too thinly and if a buyer will be interested in all of their business – if not, the business may be growing in a value negative way.

For more on the equity value risks in international office expansion, click here.

  1. Failing to professionalize the business – A business made up of very smart people who generate work by network selling may make a lot of money, but may have very little value and be hard to scale. Unfortunately, many owners can be slow to introduce the necessary cogs in the machine needed to guarantee future growth. Buyers are only interested in organizations with high potential to grow, but there isn’t any value in a company that relies too heavily on a small set of highly skilled individuals. When you come to sell the business, it is the demonstrable evidence of these disciplines and business constructs that will enable the buyer to place a value on your company.
  1. Misunderstandings of valuation – Consultancy owners sometimes mistakenly assume that their business is both valuable and sellable when buyers approach them speculatively. In the real world, poor knowledge on value often results in premature, bad, or failed deals. If you don’t know the realistic current value of your company, how do you know what good or bad looks like when decisions are to be made?
  1. Lack of a plan to become ‘sale ready’ – Sale readiness has two meanings: firstly, that the business is at a stage where it has reached the desired value and, secondly, that it is well prepared for a transaction. If the plan is to grow to $20m and exit in three years, then it is important to bear in mind that, though, the target of $20m might have been met, there might still be a high risk in completing a successful transaction. A lot can go wrong in the six-to-nine month transaction period.
  1. Inadequate shareholder alignment on exit strategy – If you are not the sole shareholder, then other shareholders will have their unique needs and goals. If these goals are too diverse, then growth may be held back, or a potential sale may be hindered.
  1. The Johari Window mistake – Supreme confidence is a valuable thing. While entrepreneurial achievements deserve all the hard-won kudos and respect earned, does this mean you don’t need to take advice on value growth and selling your company? Savvy owners that avoid this mistake build into their plans that they ‘don’t know what they don’t know’. They build a support structure around them to ensure that hazards are foreseen during value growth and that there is a high probability of a successful transaction when the company sells. So hire an advisor; if not Equiteq, then someone else.

If you’d like to read more about entrepreneurs’ eight biggest mistakes in building a sale ready consulting business, please read the full article here.

Are you a member of Equiteq Edge? It’s full of content to help consulting firm owners grow and realize equity value in their business. Register here to gain full access.