According to Forbes, there are approximately 28 million small businesses in the US, over 22 million of which are self employed, with no additional payroll or employees. As such, software sales professionals who overlook the potential advantages of selling to small businesses are missing out on a potentially very-profitable resource. That being said, there are a handful of reasons why selling software to small and medium-sized businesses (SMBs) presents a different set of challenges than selling to enterprise-level businesses. For one, SMBs have fewer resources, and what resources they do have tend to be less liquid. Another reason is that small business owners are busy working to advance their company goals during the optimum business hours (Monday–Friday, 10 a.m. to 12 p.m., and 1 p.m. to 3 p.m). These owners seldom have much in the way of available time, so for sales teams, getting a face-to-face meeting with key decision makers can be a herculean task in and of itself.
Additionally, SMBs often find themselves sitting in much more precarious positions, business-wise. Mistakes, even small ones that enterprise-level businesses would be able to shake off with little trouble, can mean disaster for certain SMBs. This has the potential to drive SMB leaders into a defensive position, making them less likely to take chances, and more prone to risk aversion.
But does that mean that SMBs are more trouble than they’re worth? Well, given that small businesses account for 52.6% of all retail sales, 46.8% of all wholesale sales, and 24.8% of all manufacturing sales, those salespersons who choose to overlook the small businesses are missing out on a major resource.
As such, sales professionals need to make a very strong case demonstrating that the goods or services they’re offering will provide a significant ROI. For this reason, the best way to approach small business sales is to understand how their goals and pain points differ from enterprise level businesses. So, before we move on let’s list a couple of these differences.
The famous naturalist author, Edward Abbey, once said, “Growth for the sake of growth is the ideology of the cancer cell.” If you narrow the context down to SMBs, This quote rings especially true. According to Jason Nazar at Forbes, even though 543,000 businesses start up each month, even more businesses are closing their doors. To put it plainly, overexpansion is one of the leading causes of SMB failure. It’s also, arguably, the most tragic, because it means the end of organizations which could otherwise find success. Some small businesses are positioned to benefit more from focusing on stability and self-sufficiency, then from setting their sights on exponential growth.
Back in the days of traditional client-server software packages, technology trends favored large enterprises. That’s because they entailed a big, expensive cash commitment upfront, backed by a staff of in-house IT professionals for implementation, maintenance, and security. Very few SMBs had resources for those kinds of purchases, and those that did often preferred to avoid such large expenditures. Recently, however, software as a service (SaaS) has changed the game. By making day-to-day infrastructure needs into a monthly operational expense that can be scaled up or down as an organization’s needs evolve, many SMBs can now afford technology upgrades that were previously unavailable to them.
If you have a product that can be presented as something that improves stability, or provides scalable month-over-month operational solutions, then you’ve met all the basic criteria for selling to small business. Better yet, if what you are offering involves training or software that teaches SMB owners how to increase business sales in a small business, then that product will essentially sell itself. And if you are able to demonstrate the value of your product, and continue to support successful small business clients beyond the date of their purchase, they will remain loyal for a long time to come. On the other hand, if what you have is little more than a watered-down version of an enterprise product—something that isn’t appropriately scalable—then taking it to SMBs may not be the right choice.
Thanks to the growing market for software as a service, storage as a service, and security as a service, small businesses are able to reap the benefits of technology at the same or similar pace as larger enterprises. And, nationwide, SMBs are spending larger portions of their revenue on technology (according to entrepreneur.com). Of course they also spend on more traditional costs as well, such as office equipment, transportation and shipping, financial services, and marketing. So, despite tight spending and time constraints, SMBs are always in the market for something. If you think you’re selling something a small business might want, here are some tips for how to go about it.
When it comes to selling to SMBs, you need to be the flexible one in the relationship. Pricing, service terms, and even worrying about your competitors will all take a back seat to getting SMB owners to give you their precious time. Make it a rule to set and keep appointments on your end, but remain flexible so as to accommodate changes on the end of your client.
A small platoon of slick-looking, stuffy corporate types is the last thing most small-business owners want to have to deal with, especially when it comes to making sales-related decisions. Most small business owners are average Joes, and would prefer to do business with someone similar. If you’re going to get to know the prospect’s personal pain points, as well as their company pain points, you need to position your approach so that a personal relationship can be built. CRM platforms that help to organize and facilitate the seller-buyer relationship can make a significant positive difference in this respect.
No matter what you may be selling, the small business must be able to implement it seamlessly into their existing processes. SMBs generally don’t have the stability necessary to be able to take a break from doing business to learn new programs, or restructure their architecture to be able to take advantage of something that doesn’t integrate as naturally as it otherwise could. Basically, if what you’re selling isn’t easy to use, or easy to switch over to, you aren’t doing yourself or a small business owner any favors. Ease of use will help you make considerable gains in customer acquisition, and will be likewise valuable to the business owner when the company starts to scale with volume.
You should be able to share relevant data that demonstrates a measurable, and trackable, ROI to your customers. Backing that up with a performance guarantee and stellar customer service policies will go a long way toward removing anxiety from their purchase decision. In fact, if you have a valuable product or service that is being pitched correctly, the only anxiety your potential client should feel is the anxiety of what might happen if they don’t take you up on your offer.
As mentioned earlier, not all small businesses want to grow, but for those that do, the right solutions might be exactly what you are offering. So do them a favor, and present your solutions in a way that is accessible, respectful, and honest. By helping SMBs become something more, you’ll end up with a long-term relationship that will not only bring you a considerable ROI, but that might also help your client to achieve something great.
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