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Client Qualification – 5 Steps to Profitable Sales

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Do you like working lots of hours to get a proposal to a client, only to find you’ve lost the bid to the competition? Or even worse, the prospect has dropped the project altogether? No, neither would we.

That’s why in this blog we’ll tell you what client qualification is, why it is important and how it can be carried out effectively. Please feel free to add any suggestions, opinions and tips in the comments below – sharing ideas is great for improving performance.

What is it?

Client qualification is one major piece of the sales process puzzle. As we wrote about in our recent, ‘How to Revolutionise your Sales Process’ blog, this part of the sales process has evolved to be named the ‘consider’ stage. For this blog though, we’ll stick to what you know and call it client qualification. Client qualification is the process of asking smart questions to discover whether a client is worth your time and resources.

Firstly, a client needs to tick the following 3 boxes to check this on a basic level;

1. Means: Is there approved funding? It may seem obvious, but if a project doesn’t have approval and funding, or there’s no specific timetable for funding, it doesn’t exist.

2. Authority: Are you speaking to a decision maker? Without access to the decision maker throughout the proposal process and the project, you’ll struggle to find where you stand.

3. Need:  Is there a real need for your offer? This relates back to our natural pain and pleasure animal instincts outlined in the Hedonic Motivation Theory. This states that a human’s decision making is influenced by their willingness to move towards a goal or away from a threat. To find out whether there is a real need, you must understand the goal the client is trying to achieve or the pain they are trying to avoid. If you understand their motives, you can create a smarter proposal which focuses on these aspects.

Once a client has ticked these 3 boxes, you need to analyse whether working with them would be the best use of your time. A world-class sales person understands time is more important than money. Thus, they are smart about how they invest their time, they don’t chase revenue; they seek out Profitable Sales.

Consider this;

If you picked your clients like a football manager picked their team, who would be your starting 11? A football manager doesn’t just put all the top goal scorers on the pitch, in the same way you shouldn’t pick all the highest paying clients. A football manager strategically picks his team, taking into account the whole season, in order to achieve their end goal or avoid their pain (e.g. win the season or avoid getting relegated). The same should apply to you. Think of your career as your season. Are you picking clients who will help you achieve your long-term goal? Can you walk away from clients that don’t meet your profitability goal?

Why is it important?

As mentioned above, time is money, yet time trumps money. Therefore, focusing on the most profitable sales, rather than all possible sales, will be much more effective. Not only this, but leads effectively qualified early on in the sales process make confirming the deal, or the ‘close’ much easier. Why? Because the angle you need to take to get the deal done and dusted has already been worked on.

When a client asks you to bid on a project, give yourself a high five, you’re marketing is working and you’re credibility has shone through. However, before diving head first into your proposal, you need to qualify the client. You need to understand the risks and rewards involved before you sow the seeds of success.

If you do run head-first into a proposal like a bull in a china shop, expect to lose out at some point. You could end up with an under-funded, over-scoped project that drains profit from your own business and builds up large opportunity costs. There’s a time and a place for charity. This most definitely isn’t it. Here are some more reasons why effective client qualification is important;

  • Uncovers false or impossible expectations.
  • Determines the approximate timescale and difficulty of a project or campaign.
  • Determines the client’s commitment to achieving goals.
  • Maps out a potential client’s internal chain of command (staff, managers, directors etc.).
  • Best-fit clients will appreciate the creativity, passion, excellence and hard work you do.
  • You will be much happier knowing that your time is being spent effectively.
  • You are more likely to reach your long-term goals sooner.

How can it be done effectively?

1. Write down what a ‘Best-Fit’ client looks like

Understanding what ‘the perfect client’ looks like is of fundamental importance when qualifying leads. Take the time to actually write this down, keep it short and stick to the point. Print it off and keep it handy so you are always reminded of what you are looking for.

2. Create and use a Qualifications Checklist

I touched on this earlier in the ‘What is it?’ section so I won’t go into too much detail. You may have a set of qualification criteria already, you may not, either way it’s essential you have one. There are varying qualification criteria, we find the following most effective;

1. Means – do they have the funds to pay?

2. Authority – do they have decision making authority?

3. Need – is there a real need for your product / service?

3. Ask the right questions

Yes, asking questions is crucial in the sales process. You must understand your clients’ needs before you can look to fulfil them. Ask specific, well thought out questions which are to the point. Again, take the time to write these questions down, ask yourself, ‘Are these the best questions to ask?’.

4. Use an effective Sales Process

Being the number 1 client qualifier in the world is all well and good, but if you don’t effectively complete the rest of the sales process, it’s useless. Therefore, you need to stick to an effective sales process, and more importantly you need to be good at completing it. To understand more, read our, ‘How to Revolutionise your Sales Process’ blog.

5. Understand how you perform against competitors

Why would you care about how your client qualification compares with your competitors? More importantly, why would you care about how your sales performance compares with your competitors in general? Well, if you want to reach world domination in sales, you most definitely should. Understanding your current performance, compared with your competitors’ and best in sector is very beneficial. It identifies a ‘competence gap’ which clearly highlights your potential performance and the most appropriate focus for improvement.

For example; you may think your client qualification and sales process are World Class. Yet, compared to your competition, you’re performing only 5% above average and 40% below best in sector. What does this tell you? Well, it tells you there is plenty of room for improvement. But compared with other core sales competencies where you were performing above average, it highlights an area of focus. By understanding how the most successful businesses are achieving their results, you can develop your own action plan ensuring you can improve and match their performance.

Find out how your Sales Team can make more Profitable Sales and start your Benchmarking Journey now with SalesBenchmark


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