If you’re not a Sopranos fan, don’t visit Satriale’s Pork Store.
In the TV series, one of the places Tony would meet other mobsters to have a “sit-down” was Satriale’s. He’d draw a line and after that the relationship was refreshed and redefined going forward.
Here’s the lowdown: As an MSP owner, you have to have a sit-down with your customers – face to face. That means you in person, not an employee.
You started this relationship. You’re the contact, and the personality, and the company. You’re the beginning and the end of the business.
If you want to lose a customer for sure, email your new pricing sheet and wait for an answer. [Insert slow hold music here.]
So, here’s an overview of the sit-down process:
- Gather your data
- Prep your binders
- Meet with each of your customers
- Have them pick one of the new plans
- Drop any customer who does not sign a new agreement
I’m serious. You honestly and sincerely, deep in your heart, have to be ready to walk away.
Let’s say you’ve followed my advice elsewhere: You’ve defined your ideal customer, your pricing structure, and your services agreement. You’ve got an awesome three-tiered price sheet. You know what you want and you’ve defined it quantitatively. You’ve listed services and put a price on them.
You’re 100% ready to go.
Now you just have to have the guts to walk away.
Here’s an important negotiation tip: If you’re not willing to walk away, you will lose (or pay too much, or get too little). So, we’re going to help you get to the point where you have the self-confidence, experience, and gumption to walk away.
Sort your customers
Make three sets of lists. We’ll call them silver, gold, and platinum. Now try to guess which agreement each customer will sign, based on past performance.
The result is a new list with three columns. The columns are “Most Likely to Sign Silver,” “Most Likely to Sign Gold,” and “Most Likely to Sign Platinum.”
Gather data, prep your binders
For each customer, you’re going to show up with a nice presentation folder. If you already have them, great. If not, scoot over to Staples and get some. I wouldn’t have any printed just for this. But whatever you want to do is fine. At a minimum, show up with a nice presentation binder with your business name on the front and your card inside.
Remember that report on labor sales per customer? You’re going to run that report for the past 12 full months. Print up two copies so you can go over this with the customer. The report shows all the money this customer has paid you for labor over the past 12 full months.
Note: If the customer basically spends nothing, skip this report.
We went to one customer who had spent about $1,000 over a year. We believed 99% that they would drop, but we wanted to let them make the decision. They signed for $500/month. That’s $6,000/year. We’re happy to have them onboard!
Also in this binder, you will put two copies of your newly minted Services Agreement, two copies of the price list, and one copy of your credit card agreement for recurring billing. You’ll need this if they pay by credit card.
That’s it. No marketing material (they know who you are). Clean and simple.
The order in which you talk to your customers is extremely important. You’ve got your three tiers: most likely platinum, gold, and silver.
You’re going to start at the low end (most likely silver) for several reasons.
First, you believe many of these people won’t sign at all. Second, these people are really the least likely to sign. Third, if they sign, they’ll probably sign silver.
Here’s the strategy: You haven’t pitched your awesome new plan before. So you’re going to start with the least likely customers. You’re going to explain your model, and the features of each level. And you’re going to say the words, “We think Platinum is best for you.”
And you’re going to listen. You’re going to write down every question, every objection, and every time they say, “That’s a good point.”
In other words, the strategy is that these silver suspects are going to teach you how to sell this product to the next level of customers. You’ll learn all the sticking points and questions. And you’ll develop answers.
Along the way, you’ll develop absolute confidence in your new system. In justifying it to everyone else, you’ll justify it to yourself.
For now, only make appointments with silver suspects. You’ll schedule gold suspects after you’re about half done with the silver.
Important safety tip: You have to make these appointments!!! They cannot be over the phone. You cannot email the price list.
This is a sit-down.
Your business will come to a stop for 15-30 minutes while you sit across the table from your customer and talk about how your refreshed relationship is going to work. Similarly, your customer’s business will come to a stop for 15-30 minutes. You’ll force them to stop, sit down, and go over this.
Don’t get discouraged if customers don’t jump at the opportunity to meet with you. They’re busy and you’re just another vendor. Plus, they might suspect bad news or a price increase. But mostly they’re just busy.
Don’t meet with the office manager or your primary contact unless that person has the ability to sign a contract.
Don’t meet with anyone who can’t say yes. Lots of people can say no. But only one or two people can say yes.
Part of redefining this relationship is that you have to have an owner-to-owner discussion. You’re going to tell them what the new system is and they’re going to pick a plan.
If you give your pitch to anyone who can’t say yes, they’re going to interpret your offering, your pricing, and your past relationship. And even if they’re an advocate, they may not convince “the powers that be” to sign your deal.
Don’t meet with anyone who can’t say yes.
If you show up and the person who can say yes is not there, be polite and ask to reschedule. Don’t go through your pitch. Don’t meet with anyone who can’t say yes.
[Can I stop kicking the dead horse yet? Don’t meet with anyone who can’t say yes!]
Prepare for your meeting
You need just a few more things before you show up for your meeting. This is extremely important if you are not a one-person shop.
Before you show up to any appointment, make some customer-specific notes. You already have the money printout. Now you need to make sure you have information on the following:
- Are there any outstanding billing issues? Did the customer recently question an invoice, overpay something, or underpay something? Anything. Just be aware.
- Are there any recent technical issues that are “sticky?” In other words, are you walking into a sales meeting while the server’s down and email’s not flowing? That would suck. Similarly, was there a recent issue where your team did a spectacular job?
- Are there any other outstanding customer relationship issues that you should be aware of? If you go into the first five sit-downs and all five customers say that response time is really suffering, you better pay attention and take that back to the shop for fixing.
- Are there any technical requirements that must be met before the customer can get on a plan? For example, one of the first customers we signed had resisted paying good money for a professional backup system. They were using plain old NT Backup. So, one of our conditions was that they needed to buy a premium backup product, which they did.
- Was there a recent incident that would have been covered? This is particularly good for the platinum plan. That 10-hour ordeal with the ISP when they changed your DNS servers? That would have been covered.
All these things can be distractions. You’re going into a high-level meeting with someone who can say “Yes.” And that person has a right to bring up anything and everything related to your relationship going forward (or backward). Don’t get surprised. Don’t get hijacked.
After all, you’re going to start out by saying, “I trust everything’s going smoothly.” You want to do whatever you can to make the answer, “Oh, yes, we’re extremely happy with the service.”
This topic is super important. This is where it all comes together for your goal: Sign at least one agreement this month!
(Used with permission of Karl W. Palachuk, SmallBizThoughts.com)