10 Questions for Assessing a Prospective Customer
When you’re in a rush to acquire new business, you sometimes find yourself tempted to take on customers that you really shouldn’t. Don’t! The results aren’t good for your business.
To help avoid falling prey to this problem, ask yourself these ten questions when you’re engaging with a new prospect.
Does this prospect fit your customer profile?
You have a vision of an ideal customer ‒ maybe you even have one or two ideal customers already. But beyond these paragons, these pinnacles of perfection, your offer and services are also a perfect fit for a specific part of the market (a market segment). Therefore, define your prospect carefully by profiling its size, geography, industry, size of project and any other key characteristics that are prerequisites for you delivering your service successfully. Then be strict about walking away from prospects that aren’t a fit.
Does the prospect have the money?
Prospects that are going to struggle to pay can hit your cash flow big time and cause you all sorts of problems ‒ you aren’t a bank. Talk about pricing early on and see whether the firm’s representatives fall off their chairs in shock.
Explain your billing structure and do a credit check. If you’re dealing with a start-up, enquire into its funding and consider asking for an escrow account, where the customer can deposit your services fees in advance. If firms don’t pay on time, stop work until they do. You’re entitled to your money.
Is the prospect’s need urgent?
When a prospect is showing signs of real pain that you can fix, it will probably buy quickly and behave co-operatively while you’re working together. If the firm procrastinates about buying your service, you can bet that it does the same later on.
Is the prospect listening?
Does the firm listen to your advice and recommendations or is it just talking, talking, talking? If its representatives don’t pause for breath in your first meeting, they probably won’t listen when you need them to in the future.
Is the prospect naïve?
If the prospect thinks that you can solve its problem in 15 minutes, you’ve a real challenge. You have to commit to educating the prospect or you need to look for customers that understand that fixing their pain is going to take time and money, but that they can expect a return on their investment.
Is the prospect responsive?
During the sales process, you need information and follow-up from your prospect. Set clear tasks for it to do and state when you expect to hear back: remind the firm the day before.
If it doesn’t comply, think about whether you can be successful in doing your work. How a prospect behaves now is how it will behave later.
Does the prospect cherry-pick your offer?
If you’ve an approach (a methodology) that works, don’t let the prospect tell you that it needs only ‘this one piece’ of your offer. First, you know better and second, you’re unlikely to be able to solve the prospect’s pain doing things its way. Prospects often forget later that they wouldn’t take your advice and proceed to blame you anyway.
Does the prospect want to do things its way?
Your prospect may be a bit of an ‘expert’ in your field: perhaps it has done this sort of thing before and claims to ‘know how it’s done’. Don’t mess with your approach unless you’re really confident that the customer’s way can work and that adapting isn’t going to affect your profitability.
Do you want the prospect’s brand?
Sometimes a prospect isn’t a fit in terms of your ideal profile, but is a great brand – well known, respected and recognized. If you want the brand in your portfolio of customers, bending your rules is okay: you made them and you can break them.
Do you and the prospect like each other?
When you provide services, you and your customers are going to interact throughout the work. Often, you make a real difference to their businesses, so ensure that you want to work with the people you’ll be engaging with. If you can’t stand the sight of the prospect’s representatives during the sales process, that feeling is likely to continue into the job.