By: RSPA Membership and Retail IT Sales Leaders
Even in this ever-changing industry, two constants remain: sales teams need leads, and they need to close deals. A common challenge is knowing where to start and which sales tools and strategies are most effective. We reached out to a diverse group of RSPA member sales leaders – VARs, ISVs, vendors, and consultants – for their advice to steer solution providers on an effective path. Leverage this guidance to improve your sales team strategy and management.
Effective Lead-Gen Tactics for Solution Providers
Tom Reichart of Trea & Associates, and recently retired from Worldpay, says, based on his experience, the three most effective lead generators are word of mouth, specific association regional meetings/trade shows, and social media.
George Muchae of VAR New West Technologies, Jason Cowan of VAR Spark Solutions Group, and Jim Stewart of ISV NCC and a former reseller owner, all agreed that the most effective tools for their organizations are referrals.
- Muchae: “Referrals are, by far, our most prominent lead source. Other sources might generate volume leads, particularly if they’re well-funded initiatives or campaigns. However, the referral-close ratio dwarfs any other strategy; hence it’s our core focus to build and sustain strong partner relationships.”
- Cowan: “By far, the most effective is referrals. A referral from a customer or partner allows the sales rep to work from the credibility of the person making the reference until your own credibility is made. Otherwise, having a marketing effort that blankets and support on the ground sales efforts is the best follow-up method.”
- Stewart: “Referral was the most effective lead generation tool for my organization. If you perform at the level your customers expect, they are generally more than happy to provide feedback to prospects on your behalf and provide you with referrals. Instead of having a cold lead you have to cultivate, you have a prospect with a certain level of comfortability with you.”
Bart Collins of VAR Macro Integration Services, Inc., offers an angle for a service-driven organization, “My company is primarily a service-oriented company, and the majority of our leads come from our existing customers. Often, they refer us to other businesses in need of the services we provide. Usually, their existing service provider has fallen short of the customer’s expectations.”
Kenny Thompson of BASYS Processing says, “Joining trade associations (like RSPA!) and attending trade shows are both excellent ways to generate leads. Strategically choosing associations and shows that align with the goals of your own organization is key to maximizing ROI.”
Andre Nataf of Heartland comments, “You should network with vendors that sell into your addressable markets, become known as the community expert in your specialty, and be part of a dealer network that generates leads for you or partners you with leads generators like local banks, other sales channels, consultants, associations, etc.”
Fixed Pricing or Allow Reps to “Make Deals”?
Our panel of industry sales professionals offered varying opinions when it comes to allowing sales reps to negotiate. This does not mean that one decision or the other is wrong, but you have to understand what works best for your solution and company.
BASYS’s Thompson says, “We believe in empowering our team to negotiate. Giving them the knowledge and tools to know when there’s room to negotiate on pricing is essential. Company culture is important here as well. When the goals of your sales staff and the rest of your organization align, you can trust reps to negotiate in good faith, with the best interests of the company in mind.”
Heartland’s Nataf comments, “It is best practice to limit price erosion and set value because otherwise, the marketplace will assume there is no value. With that said, you need to allow your sales rep to negotiate to a certain range and comp them more when they sell at full value. This allows them to close the deal versus leaving the door open while they get permission.”
Trea’s Reichart says, “In today’s world, prospects 9 out of 10 times require negotiation. Pricing should be held, but other added services could be used as closers.”
New West’s Muchae says, “It’s important to have a structured approach to pricing since, after all, it’s the linchpin for profitability and net gains. We have an added layer of complexity since we serve reseller partners and end users (retailers), which further asserts the need for strategic pricing initiatives. We always welcome volume business and the opportunity to review pricing exceptions on those grounds to close business.”
Spark’s Cowan adds, “In this time of cloud and tablet systems, cost has been much less of an issue than it used to be when selling legacy systems. However, giving a sales rep some leeway to make deals is important. Knowing where your pricing fits in the market so the rep knows when they should negotiate is important. Don’t allow a new rep who doesn’t know the ’why‘ of negotiating discount or they will every time.”
NCC’s Stewart comments, “Although I did give my sales staff leeway in pricing, it was generally not something they needed to lean on to close a deal. We very rarely sold on price. If you are good at consultative selling, price is not the sole factor in a prospect making a purchase with you. We always sold the value we provide so, generally, we did not have to provide discounts to close the business.”
Final Words of Sales Advice
It is important to stay true to your business and have a solid mission and vision to guide it, but it never hurts to venture out and try new products and selling techniques. Thompson characterized this philosophy saying, “If you’re struggling to generate leads, diversification is always a good idea. By adding to the functionality of your product or service, you enable yourself to expand into new markets. Frequently reassess and refine what you’re offering and make it as customizable as possible. Once upon a time, BASYS didn’t offer POS integrations. When we added that to our suite of solutions, every merchant processing on a POS system suddenly became a lead!”
Muchae adds, “Servicing the retail business inevitably forces one to quickly discover techniques that are gaining traction and those that aren’t. Correcting these strategies is pivotal to survivability since the market doesn’t offer much margin for error. The competition is always lurking and, rightfully so, it keeps us on our toes.”
Nataf says, “Too often in today’s market, companies are bundling offerings by combining two non-related services or products. This confuses the merchant by allowing them to think they are getting one for free when actually they are paying nothing for one and twice as much for the other. When this happens, companies eventually end up charging the right price for one and giving away the other. While that may work in a one-time offering like a coffee machine and coffee, but it works less well in products like software and credit cards where both require ongoing support and development. It is important to educate your reps on how to sell the values of all your products and be willing to sell one without the other. This will allow you to keep a high bar on the quality for all your offerings, thus allowing your reps to sell on value.”
Collins comments, “We don’t focus a great deal on growth. We make sure we maintain the satisfaction, relationship and profit margin of our existing customers. This mentality has fueled a tremendous amount of growth for us.”
Reichart adds, “Resellers need to be confident in the products and services and support they offer. They need to believe in themselves and go into the sale convinced they will win!”
Cowan advises, “Competing with direct sales competitors makes it very important for the reseller to know who their target market is. Find your target and focus intensely on that market.”
Meet our RSPA Membership and Retail IT Sales Leaders
Bart Collins | President | VAR Macro Integration Services, Inc.
Jason Cowan | Principal, Business development | VAR Spark Solutions Group
George Muchae |Principal VP, Business Development | VAR New West Technologies
Andre Nataf | SVP, Point of Sale | Heartland
Tom Reichart | Principal | Trea & Associates
Jim Stewart | Channel Sales Manager | ISV NCC
Kenny Thompson | National Director of Business Development | BASYS Processing