r/Entrepreneurthat I would give a write up on how I used cold calls to get started and push through the first 2 years of beginning a business from nothing.
I have since incorporated and grown a lot, and don't cold call very often. However, I still get into big companies through cold calls, and had a meeting last week with one of the biggest fish I've ever sat in front of as a result of a cold call – I just hate making them and so use this strategy infrequently. I love referrals and people calling me!
Author's note: I finished writing this post, and it is nearly 3,100 words. I put my heart and my soul into writing this for you guys. Maybe there is a person out there that will be inspired to take this even further than I did. If that is you, don't forget to share! All glory to my savior Jesus Christ for leading me to where I am. Without God showing me the path, I couldn't share it with you!
First, the (short) story:
I was an EMT and volunteer firefighter in California back in < year >. I was working in the emergency room of a hospital and had a really tough Monday – lots of death, blood, and more. I decided the only reason I wanted to be a firefighter was because of the retirement (residual) income. If I could do it faster another way, my mind just opened to it. Queue my brother-in-law coming back from a trip to the east coast and telling me about a business opportunity. I started selling websites for another company (which is a really terrible summary of what actually happened, but it's short).
When I started, I didn't have ANY money to spare. I had about $5,000 worth of "emergency fund" that I could live on, and my wife worked and brought in about 1800/mo after taxes. Our bills cost about 3000/mo, so I needed to come up with at least 1200/mo to survive by selling websites. I ended up resorting to the only thing that costs no money: Cold Calls!
TL;DR: Make cold calls, even if you're terrible like I was. Use my script (Link below). Record data. Follow up. Profit.
The idea of picking up a phone and calling a stranger to solicit them to purchase something I was selling made me feel sick. I was also scared of the rejection, and justified my position with every "logical" argument that I could think of. But when you're on a time clock that ends in homelessness and starvation (or failure), you've got to man (or lady) up and do it.
Some stats and info These are my statistics based on what I recorded. I don't have excel spreadsheets of data to link… Only my company's existence and some old notepads with my first call logs to prove these things, lol. My current URL is < domain >.tld, though we are currently in the middle of a re-brand and the website may not be fully functional for anyone that goes to see it yet!
• I talked to a person about 70% of the time, so if you want to base my stats on actual people I talked to on a cold call, it's actually 3.25%. This means that for every 100 conversations, I made 3.25 website sales. My conversion rate including non-answers was 2.5%. I counted all non-answers in my daily calls too.
• I tried to make 50 calls per day in a 4 hour time-frame, which calculates out to 250 calls/week (assuming Mon-Fri only). The actual number was around 150-200 in action, because I got lazy some days and hurt feelings other days. In addition, making follow-up calls (which don't count towards these "50 calls per day") got to be pretty time consuming eventually. Sometimes I'd make 15 of these in a day, and they took even more brainpower than a cold call sometimes due to them being a longer call.
• The best time to call was the hours of 9AM – 11:30. The hour of 10-11am was the best. I'd typically make calls from 8am-noon.
• My time to closing my first sale ended up being 2.5 months. I think the 17th call I made eventually led to my first sale. I made it in November, and it didn't close until mid-January. I eventually shortened this cycle to 2 weeks – 1 month, but I really sucked at calls, talking to people on the phone, etc. at first, so I needed more time and more numbers to start. If this proves anything, you can be absolutely horrible at this like I was and still make it happen!
• In all the time I did calls, and it must've been thousands of them, I made 0 sales on the first call. I wasn't trying to make them on the 1st call, which is a part of my process outlined below (small commitments leading to larger commitments).
• My market area is San Diego County, California. While there are a ton of big businesses here that make money, there are many small businesses that are 1-5 employees, and these people were who I was trying to target at the time.
• I was selling a website product for another company at this time (MLM/Network Marketing deal). The average ticket price was between $1,200 – 3,000 each, and my take was around 70% of that. So, assuming an average take-home of $1,050 (Which was common), that meant that each 100 dials would eventually net me about $2,625.
• Every time I was told "no," I assigned a value to it. I'll save you the math, but at first, each time I heard that word, it was worth about $10 to me. When I got going, each "no" was worth closer to $35 each, because every no led me to someone that says yes! Not every call ended in a yes or no – sometimes it was the dreaded "send me an e-mail and give me a week to think about it" which is not yes or no.
• I was closing the deal myself, because people wanted to know that they got to deal with me – The idea that I was some salesperson that wouldn't care if the product I sold worked or not is an appalling idea to a business owner. They wanted to know I was their account manager, too, which is something I carry forward in my agency now. If a salesperson sells, they get to maintain the relationship and ensure the client is satisfied, too.
Where I found my list to call:
The local Chamber of Commerce websites. They always have a business directory that includes the business owner's name, their current website, the correct phone number, etc. Very good and current source of info, you can start local, and you can use the fact that you found them through the Chamber as a positive thing. Just search for the site on Google — [city] + chamber of commerce (i.e. – San Diego Chamber of Commerce). Often times, there are 300-1,000 businesses right there, and every one of them has the business owner's name, a phone number to call, and website address to investigate further.
Local free/low-cost networking meetings/groups. I actually wasted a LOT of precious time at local meetup groups – most people were poor like me, and they were only looking to sell (not to buy or refer)! I found these through
www.meetup.com. I'd actually recommend against going to these if you're purely focused on trying to sell stuff. There are other, better networking events you can attend (I have an entire process for networking events that has made me even more than cold calling – maybe I'll share that next?)!
The local business directory book that gets delivered. You can even use one from last year.
Local magazines delivered to communities.
Googling things like "Chiropractors in 92008." Some people have more money than others, and so I'd spend some time creating a list from googling a profession + zip code. Often times, it produces some decent results.
How I qualified my list:
This is going to be a bit specific to my niche, which was selling websites (and later online marketing services) to businesses. However, you can also qualify your list so that you are talking to more of the right people and spending less time calling/talking with the wrong people!
• I looked at their website. If the website looked old or had an old date at the bottom of the site (aka ©< year > when it's < year >), that was a good candidate for calling. If the website was newer, I'd pass on it (though if it was somewhat new, this was a good candidate for online marketing services).
• They had to be local places/people. I didn't want to be that call you get from an out-of-state number, because those calls get ignored. Local calls get answered.
How I documented calls & results:
A note on this: If you don't record who you called and what happened, you won't be able to follow up, and consequently won't make it anywhere. You need to be able to follow up on people and call numbers that didn't answer the first time or you'll run out of decent numbers to call.
• I opened up a word doc on my computer, numbered a list, and copy/pasted the info if I found the info online or typed it in manually if it was from a magazine/directory/business card. My first notes were actually on a yellow legal pad. I'll get a pic of them, because I still have them somewhere, but digital is best. Client Relationship Management (CRM) systems are great, but it's more important to make the darn call and be marginally organized than to be highly organized and sit around doing CRM optimizationlike a poor idiot trying to avoid making his/her calls.
• I determined my Key Performance Indicators (KPI)s (Key Performance Indicators) to be: # of calls made, # of people that answered, # of decision makers reached, # of requested call-backs or e-mails, # of appointments set, # of sales made. I made a mark next to the corresponding number on my list for each of these things occurring.
• I recorded the meaningful points of the conversation (aka what to remember if I talked to them again), and the next step. If they said "not right now," I'd write to call back in 6 months. I didn't call many of these people back.
The Goal of a cold call and any necessary follow-up activity is to get to a Yes or to a No.
Don't try to convince people of your product's value. That takes more effort and isn't what you should be doing. Explaining is required, but convincing is something altogether different – I didn't have the time or patience to try to show that there was value in a new website. If they didn't see it, then they didn't have any money or they were old-school and likely going to be tons of work to convince.
• Small commitments lead to larger commitments. I didn't ask for the sale right away. I didn't ask for an hour of their time. I didn't ask for them to meet for coffee. I asked for 5 minutes of their time over the phone. If they liked what I had to say, then I'd ask for 30 minutes of their time to show.
• Don't leave voice mails for people unless they know who you are. Only leave voice mails for follow-up calls.
• It is okay to call as often as 5 times per week (once per day), but only leave one voicemail per week in follow-up. It is safer to call only 2-3 times per week, and you should call less often as time goes on so you're not annoying. I'd say up to 5 calls the first week, 3 calls in week 2, 2 calls in week 3, and 1 call per week after that for follow-up. Just a general set of guidelines.
The most important concept I learned on my own: The Three Boxes
People have three boxes in their head that need to be "checked off" before they will allow you to pass. The receptionist, the business owner, or the office manager will reject your call and not even give you an answer if you don't give them these three critical pieces of information!
• – Your name. You don't need to give your company name. Sometimes it's even a bad thing if you give your company name. It doesn't add credibility – It just tells me that I don't know you. Most times, I'd only give my first name, and this was almost always fine.
• – How you found them. This tells them if you have something in common or not. If you found them in the Chamber of Commerce, for example, this tells them that you're local and immediately differentiates you from a random cold call. Look to leverage anything you can to show that you are "like them." If you can somehow connect on any level, you get a check on this box, because you seem human.
• – Why you're calling (and it better not be to sell something!). This one is really the crux of why I am different. If I told someone that I was looking to sell them a website, they'd get rid of me as quickly as possible. "Ugh, not another sales call…" I needed to give them a different, but still valid, reason for calling. My reason was because I saw "a potential fit between our businesses, and was calling to talk to [insert name here] about it."
I do tell them what I am selling afterward, but once I addressed the third box in this new way, something magic happened. People started listening! I was no longer selling snake oil to make money, but was offering to talk about something that would be mutually beneficial. Often times, they would identify with me, and I would get people to give me respect and honest answers. Many times, the answer was still no, but I got my answer! And guess what? Sometimes the answer was yes and I made a sale!
Hopefully by now, you have read this and can understand why my script is this way.
How I followed up
There is a difference between following up and moving prospects forward. It's a lot simpler than you might think – Start your follow-up call with a goal in mind, remembering that small commitments lead to larger commitments. For me, I always had the same goals in my prospect funnel:
• Cold call
• Ask for a 5 minute conversation (to determine if there is a fit)
• Schedule a 20-30 minute demo (even if it ends up being an hour… 20-30 minutes is easier to stomach for a "busy" business person)
• Ask for the sale after a website demonstration (Go over pricing – 3 pricing packages are important. Don't do this for custom quotes… Custom quote requires a modified process from what I shared)
• Meet in person over coffee, buy their coffee, thank them for their business, get to know them and their company more, and ask for referrals.
The end result (Recap)
I went from being ~5 months from bankruptcy to making just over $120,000 by myself (using the same company I sold for as sub-contractors for the work, which their cut wasn't included in the 120k) in my 2nd year of doing this. I also supplemented this work with focused business networking after a while, which is a whole other 3,000-word post in and of itself.
A few final notes
• I made a commitment to making 50 calls per day, 5 days per week. I know others can supposedly bang out 100-300 calls a day, but I don't know how you do it with any brain power. My brain power was gone after about 50 calls. I would make 50 calls in 4 hours or less. That is a good benchmark, especially when starting out. I was also given that advice by other successful sales professionals. A note is that I counted every time I dialed, whether I spoke to a person or got a voicemail.
• I bought a pack of small beads at Wal-Mart and put 50 of them into a cup. When I dialed a number, I would move 1 bead over. It was motivation once I was 30 calls in and didn't want to finish. I even wrote cheesy motivating blurbs on the cups like "you can do it" and "keep going!" Whatever gets you to keep picking up the phone.
• Don't let yourself get distracted. You will stop making calls – I guarantee it!
• Don't start doing this without an emergency fund (shoutout to
r/PersonalFinance in place. I recommend keeping 6 months of expenses in an emergency fund account. I needed mine to make it happen.
• You need to have the memory of a goldfish! You have to just forget or leave behind the negative experiences and focus on doing your best now. I did not get yelled at very often, which was due to the way I conducted calls (explained below), but it hurt a LOT when I did. Also, there were entire days that I failed on myself. A few times, I remember making less than 5 calls, putting on headphones and playing Elder Scrolls: Oblivion for 8 hours straight because I let a mean person get to me. Nothing against gaming, but this will kill your dreams – I was not okay with failing on my wife and potentially losing our home, but I failed that day. I would pick up and continue on the next day as if nothing happened – It's a new day, and a new chance to succeed! Don't get down on yourself for failures.
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