by Sandler Training

Leo, a new sales hire, was having a hard time making quota. He asked his colleague Sam for some help.
Sam asked, “Can I sit in on your next presentation?”

“Sure,” said Leo. “You can come along to my presentation appointment tomorrow. It’s an account I’ve been working on for a while. Let me know how it sounds.”

Sam agreed and sat in on Leo’s meeting, which ended with a “Thanks, but no thanks,” response from the prospect. During the car ride on the way back to the office, Leo asked Sam for constructive feedback.

“The best feedback I can give you,” Sam said, “is that you didn’t connect the dots. As far as I can tell, that’s why you didn’t get the deal.”

“What do you mean?’

“Well,” Sam continued, “that presentation you just gave was all about the supporting details – the specifications, the process, the features. Everything that’s in the brochure. I’m not saying those things are unimportant, just that they probably shouldn’t be what you build your presentation around. I think your client would have been a lot more engaged, and more likely to buy, if you’d focused on the WHAT – the specific problem, unique to this buyer, that you were committing yourself – and our company – to solve. Without that, what you were left with was just a lot of product information, most of which they could have looked up online. From where I sit, you didn’t connect the dots between HOW we work and WHAT the client would get.”

Leo stared ahead at the highway and considered what Sam had said. He realized that his friend was right. He had indeed relied on product information – because that’s what he was most comfortable talking about. As a result, he had missed an opportunity.

BEYOND THE “MAGIC WAND” PRESENTATION

For some salespeople, the vagueness of their initial prospect meetings carries through to their eventual presentations. They fail to establish clear connecting links between the elements of their proposed offer and the specific aspects of the prospect’s requirements. Instead, their presentations focus too narrowly on their product or service, their company’s capabilities, and in some cases, on themselves. Much like the magician who waves a magic wand in the air and then, with a puff of smoke, produces a rabbit, the salesperson “waves” a rhetorical magic wand (a long list of features and advantages) and then, with some verbal smoke, produces a (supposed) solution.

On the surface, those sorts of presentations may look impressive.

They typically include great graphic design and lengthy proposal documents, which are often accompanied by a host of multimedia presentations filled not only with charts and graphs, but also illustrations and animations – all designed to support that which is being presented. But on closer examination, they fall apart.

Prospects don’t much care about the features, and they certainly don’t care about the animations.

They want to know what specific, pressing problem you are going to resolve…and how you are planning to pull that off. You much be crystal clear about the strategies and tactics you plan to use to accomplish the outcome the prospect desires.

If you don’t establish a clear and unambiguous connection between the “what” and the “how” during your presentation, you’ll lose the opportunity to the salesperson who does!

THE TURNAROUND

From that day forward, Leo made a point of building his solutions and presentations around the principle of “connecting the dots.”

He focused first and foremost on the unique problems he’d identified in detail during his discussions with prospects…confirmed that solving those problems were still major priorities for the people he was talking to, priorities worth spending money to solve…and then he laid out the concise battle plan for solving those problems, complete with relevant time frames and resource requirements. As a result, his closing ratio improved – and he started hitting quota for the first time!

This blog was originally posted by Sandler Training.

By Terri North, Legal Strategies, PC

My alma mater, Kalamazoo College, recently sent out a newsletter about the importance of estate planning. One featured topic was how to stop putting off, and how to start, the planning of your estate.

The article suggested downloading the free Personal Estate Planning Kit that lets you study at home, then "ace" your estate planning test!

Each lesson in the book, such as How to Make a Better Will and How Trusts Can Improve Your Estate Plan, is followed by a multiple-choice quiz that allows you to test your knowledge of the estate planning principles covered in that chapter. 

If you're interested, you can download the Lesson Book from our website. Please feel free to contact us if you have questions.

This blog was originally posted by Legal Strategies, PC.

by Sandler Training

Melody was feeling unmotivated.

Carlos, her sales manager, was pressuring her once again to improve her closing ratio …but as usual, he wasn’t giving her much guidance on how she should go about accomplishing this goal. Yes–her numbers were bad. Melody knew that. But after three months on the job, she was tired of being lectured about the numbers and didn’t feel supported in her efforts to turn things around. In fact, she wasn’t even sure she wanted to continue in sales.

Over lunch, Melody shared her frustration with her colleague Nancy–who asked some questions about how Melody’s conversations with prospects were going. After Melody debriefed on her last few meetings, Nancy told Melody about a technique called “stripping line.”

“Stripping line” is a trick familiar to experienced anglers. Novice fishermen, when they feel a fish nibbling on their bait, try to set the hook by yanking the line. They usually end up with an empty hook—no fish—because the fish was only nibbling; it hadn’t swallowed the bait. That strategy is analogous to attempting to close a prospect at the first sign of interest or enthusiasm.

Experienced fishermen know that they will have a better chance of hooking the fish if they do the opposite of what their first instinct tells them to do. What do they do? They strip some line from the reel and create some slack. The fish then pulls the bait deeper in the water and, feeling more secure, swallows it—and the hook. Then, setting the hook is easy. It only takes a slight tug on the line.

There is an important lesson for salespeople here. Pushing against prospects just makes them push back harder, so that no one makes any progress. So instead of pushing them in the direction you want them to go, try pulling them away from it and then letting go.

Like a pendulum, they will swing back the other way. Since you always want your prospects to move toward the positive end of the arc, you should get into the habit of pulling them toward the negative end–regardless of how uncomfortable that may feel at first. Believe it or not, even positive prospects need to be “discouraged” a bit so that they swing back in the positive direction.

Thanks to Nancy’s advice, the dynamic of Melody’s conversations with prospects began to change. For instance, here’s how shehandled the beginning of a meeting with a positive prospect:

Prospect: I’m glad that we could get together. Joe told me a number of good things about you and your company. I’m sure you can help us get this project off the ground. I’m eager to hear what you can do for us.

Melody (gently pulling the prospect toward the negative): I appreciate your enthusiasm. What we did for Joe’s company, however, may be very different from what you need. (And then letting go.) What, exactly, did Joe tell you that leads you to believe we would be such a good fit?

Prospect (swinging back in the positive direction): Joe told me how you immediately engaged his engineering team in the assessment process. That’s exactly what we are looking for.

Example with a negative prospect:

Prospect: I appreciate you taking the time to contact me. Joe told me some interesting things about your company, but to tell the truth, I’m completely happy with our in-house engineering team. They’re quite capable.

Melody (pulling the prospect more negative): I understand. It probably doesn’t make any sense, then, to find out if we can cut your project implementation time by 22 percent as we did for Joe’s company.

Prospect (beginning to move in the positive direction): Do you think you can do that?

Melody (maintaining the negative position): I’m not sure. I can’t determine that until we have a conversation…assuming that you’re willing to do that.

Prospect (moving in the positive direction): Well then, I suppose we should schedule a time to do that.

Conversation with a neutral prospect:

Prospect: I’m glad you could come in today. As you know, we’ve been thinking about upgrading our equipment for some time now. Your information looks quite interesting. I’ve looked at a lot of literature, and your equipment stacks up very well against your competition. I think we may be able to do business.

Melody (pulling the prospect toward the negative): I appreciate you telling me that. Frankly, I had come to the conclusion that we’d never have an opportunity to work together. I found that companies that are continually reading literature and comparing specs rarely get around to actually making a decision. I figured that’s what was happening here.

Prospect (moving off the neutral position): Well, I suppose we have been dragging this out for a bit. But, that doesn’t mean we’re not serious about moving ahead with the project. It just means that we wanted to have all of our ducks in a row before we proceeded.

Did you notice how the neutral prospect began moving in the positive direction as a result of Melody’s comments?

• He acknowledged “dragging out” the process.
• He pushed back on Melody’s (negative) conclusion.
• He explained the reason for the actions.

The objective with neutral prospects is to just get them moving. Once they are moving, you can apply the appropriate strategy to keep them moving. For instance, Melody could gently tug in the negative direction with the following question:

I understand. But, that’s not going to happen this quarter…or is it?

Or, she could ask a neutral question like:

By when do you suppose you’ll have your ducks lined up?

As a result of “strip line” conversations like these, Melody’s closing numbers improved quickly. And so can yours!


* This blog was originally posted by Sandler Training.

by UHY LLP

​Six months following the enactment of the Tax Cuts and Jobs Act of 2018, many questions still remain unanswered regarding the implementation of the new law. However, tax planning is a fluid process and the time is ripe to revisit many new provisions. In 2018, the corporate tax rate was lowered from 35 percent to 21 percent which is significantly lower than the top individual tax rate of 37 percent. On its face, it would seem that being taxed as a C corporation may make the most sense, but actually it is the starting point of the evaluation process to determine the best choice of entity. Many different factors should be considered including:

• The nature of your business - is it in the startup or growth phase where earnings will be retained?
• Would your business qualify for the 20 percent flow-through deduction under Section 199A?
• Are you considering an exit strategy in the near future?
• Does your business have foreign operations?
• Do state taxes figure prominently in your operations?

While not exhaustive, these are just a few of the considerations that should be discussed when considering the best choice of entity from a taxation perspective. 

This blog was originally posted by UHY LLP.

by Sandler Training

THE TACTIC: Deal with “buyer’s remorse” while you’re still in front of your prospect.

THE STORY:
Nick was having a real string of successful closes. The experienced salespeople were jealous. But then Nick started having a problem.

The last three sales were canceled within days of being made. In one instance, the color was all wrong. In another, the customer said that she couldn’t wait two weeks. Finally, although the quality of the product was first rate, the customer decided she couldn’t afford it. In every instance, none of the folks wanted to have any further discussion – the orders were canceled. Period.

Nick decided that he really needed to attend the company sales training program.

Later that same day, a young couple came in and chose the highest- quality and most expensive product in the store.

“This is the one we want. We’ll order it now.”

As Nick was writing up the order, he stopped and stared at the couple. He could not believe the words coming out of his mouth.

“I hope you don’t change your mind, but let me ask you something. When you first came in, you were looking for a moderately priced item, and you’ve selected the most expensive item in the store. Are you sure you really want to do this?”

“You’re right,” replied the woman, “I’d probably think that tomorrow, but looking at it now, I know the price is worth it. Yes. We want it. No doubts.”

THE RESULT:
Without knowing what he was doing, Nick gave the customer a chance to deal with buyer’s remorse. Every customer gets buyer’s remorse, which is nothing more than asking the question, “Did I do the right thing buying?” In this instance, Nick allowed the customer to express doubt while he could do something about it.

DISCUSSION:
Buyer’s remorse is a given with any significant purchase. The buyer will always ask himself, “Did I do the right thing?”

As Nick found out, buyer’s remorse, if left unattended, results in canceled orders.

There is also a more insidious version of this remorse which is even more detrimental. The order is not canceled, but the customer is not happy with the purchase. This does not mean the customer is badmouthing the product/service, but neither is the customer “good-mouthing” the product/service. This happens often.

The result of this form of buyer’s remorse is the customer never comes back. He never tells you why; he just never shows up again. No repeat sales.

APPROACH:
The simplest, yet most difficult thing to do from the salesperson’s point of view is to give the prospect a chance to “unbuy” once he buys. Here’s the catch with this tactic: Don’t just ask if the prospect wants to change his mind – pick out a minor item that once concerned your prospect and that he stated was no longer a problem and ask about that. If the prospect starts to “unbuy” on a minor point, then you need to start asking questions.

“At the beginning, you mentioned that the color wasn’t right, but if I have it correct, you no longer feel that way and you still want to go ahead?”

Either the prospect will reconfirm her decision and not suffer from buyer’s remorse, or the remorse will immediately surface. You control how you will handle the remorse. This is preferable to having the prospect return when you are not there at all and back out of the sale.

THOUGHT:
Dealing with buyer’s remorse before you make the sale will result in a customer who will be happy to buy more products and services from you.

This blog was originally posted by Sandler Training.

by UHY LLP

The Tax cuts and Jobs Act held many changes to tax planning and required documentation for business owners in 2018. One of those changes is meals and entertainment deductibility. Prior to 2018, meals and entertainment have been mostly considered 50 percent deductible for tax purposes as long as the taxpayer could show that the meal and/or entertainment had a business purpose or relation. There were even circumstances where the taxpayer could deduct 100 percent under specific exceptions. Tax years beginning Jan. 1, 2018 or later will be held to stricter guidelines for meals and entertainment deductibility. Entertainment is now considered completely nondeductible. For employer provided operating facilities, meals are still considered 50 percent deductible, however, at this time it is unclear whether business meals, lunch or dinner with a customer, etc. will be 50 percent or 0 percent deductible.

The following examples are still considered 100 percent deductible expenses:

• Expenses treated as employee compensation
• Reimbursed expenses while away for business travel
• Expenses for recreational, social or similar activities primarily for the benefit of employees (such as an employee Christmas party or picnic)
• Expenses for goods, services and facilities made available by the taxpayer to the public
• Expenses for goods or services which are sold by the taxpayer in a bona fide transaction
  
  

There is still uncertainty about the deductibility of business meals as 50 percent or 0 percent deductible as noted above. The portion of the old law, "directly related to or associated with" standard has been removed in determining deducibility under the new law. Further guidance on business meals as well as what is considered "entertainment", which is not deductible for tax purposes, is anticipated to be released at a later time. Until then, it is important for taxpayers to be tracking 100 percent deductible meal expenses as listed above, other business meals, and entertainment expenses separately to reduce further work at year-end after further guidance is available on the deductibility of these expenses.

*This blog was originally posted by UHY LLP.

by Sandler Training

Bert’s major frustration was dealing with prospects who couldn’t seem to make a decision.

During a weekly coaching session, he told his manager, Elaine, that one of his biggest difficulties was dealing with prospects who indicated the desire to make a decision, and who pledged to do so by a certain date. When the date rolls around, though, they invariably needed more time. “They’re driving me crazy,” Bert said.

Elaine asked: “Bert, are they driving you crazy? Or are you?

THIS IS YOUR JOB!

How many times have prospects told you, “I need more time to make a decision?” Too many?

In those situations, it’s easy to blame the prospect for being indecisive, uncommitted, and a procrastinator. But doesn’t the prospect deserve all of the blame? Shouldn’t some of it fall on the salesperson’s shoulders? Perhaps the major share?

Your estimation of the prospect’s willingness to make a decision should begin at the start of the selling process when you are defining the prospect’s need, and specifically its duration. You should ask yourself: If the need has existed for some time, why has the prospect waited to address it? If the need is relatively new, is the prospect really ready to move on it? By exploring those questions early on in the relationship, you should be able to gain some sense of the prospect’s eagerness to make a decision. In fact, it’s your job to do so!

Similarly, the magnitude of the positive consequences of fulfilling the need (or the negative consequences of not fulfilling the need) should give you some indication regarding the prospect’s sense of urgency to make a decision. If the consequences, either positive or negative, are meager, then the prospect’s motivation to make a decision is also likely to be meager. If, on the other hand, the consequences, either positive or negative, are significant, then the prospect’s motivation to make a decision, and make it in a timely manner, is also likely to be significant.

Exploring both the duration of the need and the consequences of fulfilling or not fulfilling the need should give you a fairly good idea of whether you’re dealing with a “motivated buyer”. That’s someone who is likely to make a decision in a reasonable amount of time – as opposed to a “tire kicker” who is likely to need more time to make a decision, or never make one at all. Another aspect of the selling opportunity that will influence the timing of a decision is the complexity of the prospect’s decision-making process.

The more people there are involved in the buying decision and the greater the number of different corporate levels participating in the decision, the lengthier the process is likely to be … and the more likely that decision target dates will be missed. The need to do a thorough job of identifying the prospect’s decision-making process (including the “who,” “what,” “when,” “where,” “why,” and “how” elements) should be obvious here.

The more you understand the process, the less likely you’ll be surprised by it… or disappointed by it.

Yet another element that often contributes to “I need more time,” requests is the salesperson’s failure to secure firm commitments from prospects – well in advance of scheduled presentations – to make decisions at the conclusion of those presentations. All too often, salespeople consider it a given: they will make a presentation … and the prospect will make a decision. But without the prospect’s firm commitment for a decision at the end of the discussion, you’re likely to find yourself at the beginning of a long, unsatisfying story entitled, “Let’s Think It Over.”

FOUR BIG ISSUES

Bert took the coaching that Elaine had to offer and listened to what she had to say about the four big issues we’ve examined in this article.

Bert learned to carefully evaluate the duration and consequences of his prospects’ needs and the complexity of their decision-making process, and, where that evaluation indicated the appropriateness of scheduling presentations, he secured firm commitments from those prospects to make decisions. As a result, Bert dramatically reduced the number of requests for “more time” that he received. You can, too!

* This blog was originally posted by Sandler Training.

by UHY LLP

Before tax reform, there were not many limitations on a business's ability to deduct interest expense on their tax return. However, beginning in 2018, tax reform will significantly alter the ability to deduct business interest expense for a great many taxpayers.

Generally, under a revamped Section 163(j), business interest expense that can be deducted will be limited to 30% of the taxpayer's adjusted taxable income. Let's address a few questions related to this limitation:

• What is adjusted taxable income? For the years 2018-2021, adjusted taxable income is taxable income with certain addbacks such as interest, depreciation and amortization. The calculation of adjusted taxable income will be the same for years after 2021, with the exception that there will be no add back for depreciation or amortization. As a result, after 2021 it is expected that adjusted taxable income will be lower than previous years resulting in a potentially smaller interest expense deduction.
  
  
• Is everyone subject to this limitation? All taxpayers, no matter how organized, that have business interest expense will be subject to this calculation. However, a few taxpayers are not subject to the interest limitations calculation, including small businesses, electing real property trade or businesses, businesses that have floor plan financing, and electing farming businesses.
  
  
• What is a small business? Generally, a small business is a taxpayer that has average gross receipts over the prior three years of less than $25 million. While that seems straight forward, related party rules come into play that require an aggregation of all related entities to determine the $25 million threshold.
  
  
• What is an electing real property trade or business? A real property trade or business is any business in the development, redevelopment, construction, reconstruction, acquisition, conversion, rental, operation, management, leasing or brokerage of real property which makes an irrevocable election to be exempt from Section 163(j).
  
  
• Are there consequences of not being subject to the interest limitations? There are no consequences to small businesses, but for real estate, farming, or businesses with floor plan financing, there is an impact on the available methods of tax depreciation, including possibly the ability to take bonus depreciation.
  
  
• What happens if you are subject to the interest limitations? Depends on the type of entity, but generally the amount of interest in excess of the limitation will be disallowed as a deduction in the current year and will be carried forward to the subsequent year(s) when it will be subject to the same limitation calculations.
  
  

There are many additional nuances to these interest limitation rules. However, as with many tax reform items, proper and timely planning can ensure the maximum interest deduction by minimizing the possible impact of these interest limitation provisions. 

* This blog was originally posted by UHY LLP.