Sell by Caring

It can be eye opening when you use the 80/20 rule to evaluate your client list.

Today we will use it to uncover how to use your time and resources effectively.  You will need a client list with year to date sales totals.  If you feel this year does not reflect true sales figures (due the challenging economy) then gather 2009 sales totals as well.  I suggest separate totals for each year.

First step – without looking at the dollar figures go down the list and make a note by each client as to how much time and energy you have put into the account this year.  Take into consideration the time and energy of others in your company who have also supported the clients.

There are several ways you can tally this:

• An easy way is to do the A,B,C designation.  A is for those clients who have required the most time and C for those who coast by without much interaction.  Once you have the A’s and B’s designated go through this short list and do the process again leaving off the original C’s in the second pass.
• You can also estimate the time per month or quarter you spend with each client.  Take into consideration the ebb and flow of their business may increase their needs at certain times.
• Another method is to number each client according to the amount of attention they require.  #1 is for the client who takes most of your time and on down to the clients who are self sufficient.

You will most likely find that approximately 20% of your client’s are taking 80% of your attention.  The percentage may vary but the concept stands.  There is a short list of accounts that are taking more time and energy from you and other staff members.

Next step is to sort the total client list by sales volume.  Hopefully technology will make this easy to do.  Again the 80/20 rule will come into play – 80% of your sales are coming from 20% of your clients.  It might be 75/25 or a variation but you get the picture.  There is a short list of clients producing the bulk of your sales.

Now comes the eye opening step.  Working with the short lists, compare the time and energy expended to the total sales.

If a client appears on both short lists – your efforts are justified.

Clients who are on the short list for sales volume but not on the time/energy list – these are the peaches.  You want more of them.

The accounts on the short list for time/energy but not on the short list for sales – these need further evaluation.  For this group you might want to have a discussion with your sales manager or someone who is objective.  Can you control their neediness?  Can you boost their sales?  Are they contributing enough to your bottom line to justify keeping them as a client?

This is a great exercise to do in December so you can start 2011 with a clear understanding of who your most valuable clients are.

How do you evaluate who your most valuable clients are?



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