I recently had lunch with a friend and listened to a sad story that occurs too often in the world of B2B sales consulting firms — another one bites the dust! After several years of making a run at building a company, my friend decided to call it quits and go back to work as a sales manager.
He had all the best intentions when he started his company. He had all the right dreams. He had all the right talents to be a great B2B sales consultant. He had all the right experience. He had all the right funding (initially). He was just missing some important elements of a successful B2B consulting firm.
A B2B Consulting Firm Autopsy
As I listened to my friend drone on about why he didn’t make it, I conducted a mental autopsy of his business failure. Here’s a list of what his consulting firm was missing and why it significantly led to its demise:
- A Strategic Account List Management System. Without this, an organization is like a ship without a rudder destined to float wherever currents allow.
- New Business Prospects. Growth does not occur without lead generation and new business development.
- Capacity. My friend oscillated from one side of this dilemma to the other: either too few customers to serve OR too many customers to serve.
- Content. Finding the time to create fresh and compelling training courses and materials just didn’t happen.
How to Prevent This From Happening to You
Here’s a look at the list with some suggestions on how to overcome these hurdles if you are struggling to keep your head above water as a B2B sales consultant:
Strategic Account List Management
The most successful B2B sales consulting firms employ an Account List Management System (ALMS) based on the Pareto Principle built upon the theory that the majority of revenue comes from the minority of customers. Segmenting customers and prospects into categories and prioritizing both by spending level or spending potential provides the organization focus and direction.
Here’s an overview of basic ALMS categories used by successful B2B consulting firms:
- Key Accounts. These high priority customers represent the top 25% of the customer count and 75% of an organization’s revenue.
- Target Prospects. New business prospects—or target prospects—should be scrutinized using a filter that includes the following:
- Spending potential
- Access to the decision maker
- Product fit
- Secondary Accounts. These low priority customers represent 75% of the customer count yet only 25% of the organizations revenue.
Lead Generation
Keeping current customers (especially key accounts) happy and spending are essential components to survival and growth; however, significant growth will not occur unless converting new target prospects happens on a regular basis. The biggest issue tied to converting new prospects is finding them!
Some of these old school methods provide help in this area:
- Using a referral system
- Speaking engagements
- Publishing books (effective, yet expensive and time consuming)
- Advertising
There is a new source of lead generation employed by the many successful B2B consulting firms called Inbound Marketing. This approach essentially allows the prospect to find the consulting firm and employs the following:
- Thought leadership
- Publishing blog posts, eBooks and whitepapers
- Search
- Lead capturing and nurturing
Capacity
The capacity issue facing B2B sales consulting firms is acute because it causes fatigue and stress—not to mention a negative impact on cash flow! Simply put, too few customers to serve OR too many customers to serve are not great places to live as a consultant.
Here’s a list of some tried and true methods used to resolve the issue of too many customers to serve:
- Deliver service via distance meetings or technology to minimize travel time
- Develop a pool of other consultants to outsource excess capacity to when needed
- Say NO to new business prospects that have limited spending potential
Content
Training resources and materials are needed to serve customers and the demand for new and fresh training is ever present. Should you create content or serve customers? A growing trend to help with this problem is developing partnerships with other B2B consulting firms and reselling their services. The Partner Program from the Center for Sales Strategy is an example of this type of service that offers access to online training and onsite workshops. This program also pays a commission to B2B sales consultants that use it!
To learn more tips on how to avoid failure when running a B2B sales consulting firm check out this ebook:
The 5 Hurdles Every Successful Sales Consulting & Training Firm Must Clear.
