Here’s a problem that many people don’t realise that they have.
The number of times I hear people say that they’re looking to sell to SME’s and state this as if it’s a clear demographic, an audience that they can identify and sell to. Well here’s the bad news, they’re wrong and wrong in so many ways it’s almost funny.
In the UK there are 5.5 Million SME’s which makes up 99% of all businesses. Is that really a clear demographic, I think not. So let me quickly define SME’s for you.
The first category is Small, but even small has a subcategory of ‘micro’, so let’s start with that. A ‘micro-business is defined as by the EU (there is no common definition in the UK with HMRC and Companies house both having different criteria):-
For the EU a microenterprise is a business which employs fewer than 10 persons and whose annual turnover does not exceed £2 million.
These make up 95% of all the registered businesses in the UK.
A Small business is defined as less than 50 employees & turnover under £10 million these make up just 4% of UK businesses and finally, medium businesses are defined as having Less than 250 employees & turnover under £50 million, these make up less than 1% of UK Businesses. And just in case you’re interested large businesses make up less than 0.127 % of all UK businesses but generate 49% of UK business turn over.
As you can see SME’s are made up of these 3 very different beasts but are lumped together in a lot of people’s minds.
How you sell to these beasts varies differently as well. Their buying behaviours differ, who you need to influence changes. In a medium size business you will probably have to deal with purchasing departments and a chain of command before you will actually get to the decision makers, in small businesses this chain will probably still be there but less of an obstacle, and finally in a Micro business you’re much more likely to deal directly with the business owner / decision maker.
In the rest of this blog we’re going to concentrate on selling to Micro businesses,
In a Micro business there’s a very strong possibility that you’ll be trying to influence the business owner themselves. This has many advantages as they are the ones who make the buying decisions and hold the purse strings.
So, first up, always remember:
Micro businesses tend to be cash sensitive – most Mirco’s have been created by brave entrepreneurs who haven’t had access to lot’s of capital. Be mindful about this when trying to sell to them, with some smart planning you can easily work around it with the right payment plans and terms. Gaining trust is key. Micro businesses talk with other Mirco’s – they work in small communities that are tightly bound. These business owners know other business owners, so if you deliver great results, rest assured that word of mouth will be on your side and you will be referred to their peers.
Micro businesses want to know about their competitors – starting your discussions with insights about their competitors (not gossip, no one likes that) is a sure fire way to grab their attention. Helping the business owner understand what their competitors are doing in the marketplace, and how best to respond to and be better than them, will prove extremely valuable to them. With that in mind, now it’s time to consider your offer, and how you can best tailor it for Micro’s.
They want a return on investment quickly – time is money for these businesses. Delivering a result quickly and ensuring they get cash back promptly is a great way to entice weary businesses owners. But be ready to backup your claims with facts and data to prove it all isn’t just a theory. This is why testimonials are so powerful.
Prioritise good quality leads – ensure you prioritise leads that are actually interested and avoid chasing businesses that aren’t keen. Some businesses won’t have the time to respond to you, but they might do in a few months time – so always remember to follow up a month or so later when their workload has (hopefully!) eased up.
Have compelling reasons to buy – respond to and capitalise on any internal and external pressures they might be facing. For example, government legislation changes or staff requests. Ask yourself – how can your offer be the solution Micro business owners want to use.
Actively respond to the market – be sure to constantly review and update your offer. These businesses are highly influenced by even the slightest market changes, thus you have to ensure you respond as well.
Identify their needs, then align with them – make their problem your problem. Then show them the solution and how you are best suited for their bespoke requirements.
Be human – These businesses aren’t huge faceless companies. Take the time to call, particularly if you haven’t made a sale but there is still interest. Once you have formed a relationship with the business owner, regardless of business arrangements, you will be much higher on their priority list.
I really recommend that you check out my blog on how to profile your customers (Click here to read) from a few weeks ago. If you profile your ideal customers properly then you will save lots of money and time chasing the wrong type of clients/customers.
Twelve intensive half-day meetings.
