Avoid the classic sales mistakes of an entrepreneur

Avoid the classic sales mistakes of an entrepreneur

When an entrepreneur decides to start a business, he usually has several high priority tasks in his TO-DO List, such as preparing the Business Plan, choosing a name, obtaining financing, forming a team, ... Once the company is running most entrepreneurs become obsessed with perfecting the product or service, turning around the business plan pursuing excellence, and in some cases even dedicating energy to secondary (or easily outsourced) tasks such as the construction of a website.

The really serious thing is that there is often a task which is in the final positions of the TO-DO List, when it deserves to be among those above. That task is: to make the first sale of the company. Indeed, it seems as that we refuse to put on the cap of seller, as if we wanted to wait stop the sale for te moment our product is completely finished, when we feel completely safe, and this attitude can be a significant loss of opportunity:

  1. You have to start selling as soon as possible.
    Many startups would wish they had started their sales much earlier than they did. Their CEOs lament that if they had started trying to sell their product as soon as possible, they could have reduced development times or better understand their customers' objections, rather than bury money in product development. This point is one of the principles of the Lean Startup Movement, which recommends any startup to create a "minimally viable product" and start looking for customer feedback as soon as possible.

  2. Family and friends do not count as first sale.
    There are many startups who make initial sales to family, friends or other acquaintances. These operations provide income, of course, but what moves these buyers is not a real market demand, but feelings of love, courtesy or even obligation. Such sales, therefore, do not provide reliable information or indicate what a real, impartial customer may think about the product or service. Although it is good to use the network of professional contacts to sell, it must be borne in mind that the most valuable comments are those of the customers farthest from our network.

  3. You have to be selective and demanding with the first customer.
    When a company does not yet have any income, it is very tempting to launch the fishing net to a market segment and do business with the first potential customer to show up. It is very important, however, to be very demanding and carefully selecting the first customers based on their ability to provide valuable information for your product or service, based on the possibility of showing them as a reference that help you boost future sales, or even based on quickly gaining credibility and reputation. Nowadays, there are already established companies that when they launch a new product they do it with selected customers, maybe the VIPs of their portfolio, for the customer it is good because it is the first one to adopt a product or service, and for the supplier it is fantastic because its reputation is increased to the extent that a prestigious client uses its solutions. In short, the message is clear: When considering the first sale, do not just think about the income, you have to go further and look for other types of benefits that help you drive future sales.

  4. Avoid discounts.
    Without a minimal commercial history, it can be difficult for a startup to settle down and stand firm on the value of the product or service being offered. There are many startups who feel compelled to offer big discounts to get their first sale. There are even cases where the investors, who have financed the launch of the startup, push to reach the milestone of the first sale and for this, encourage to offer discounts. However, this practice is not advisable. You can derive a pattern, you can decrease the long-term value of the product or service, or punish cash flow (if the net results of the sale are negative). Companies-customers talk to each other, and if you sell one at a very low price, you have to expect for the other customers to come to a similar agreement.

Speaking to people who have started a business, one of the most frequently repeated tips is that selling is a basic function of any business, regardless of the economic sector in which it is developed. In the initial phase of launching, some companies opt to rely on third party Sales Outsourcing, which bring the talent, experience and processes needed for the sales development of a startup. In any case, selling is an activity that must be executed from day 1. You have to stop fantasizing about the great product idea or the perfect business plan. You have to go out into the street, excite the prospects and start selling. All companies need to be measured to reality, and interaction with their markets is the best way to do it.

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