Attracting Customers

Q: I've been in business for 11 months selling automotive electrical supplies to small and large repair shops and trucking companies. The problem I have now is trying to get both old and new customers to buy my products. I have a contact base of about 90 customers-about 15 percent of them have bought something from me. I have the best prices in my area, but I don't advertise a lot because of the cost. I've called my customers, seen them in person, and talked to them to see what they would like to see me sell. This month, I even released another flyer giving all my customers 20 to 40 percent off. I know it cuts into my profit, but I'm running out of choices. What should I do?

A: You're operating under the misconception that price is the overriding factor affecting your customer's decision to buy from you. When asked to rank the importance of price on a scale of one to five, customers typically put it somewhere around the middle behind value, which is usually number one. So while offering the lowest price is an important factor in your favor, your customers will be swayed by other benefits they consider to be of equal or greater importance.

Think about how your company stacks up against its competitors in the following areas:

• Service. Easy ordering is vital when your busy customers have other suppliers at hand. Can your customers order by phone, fax or via the Internet? How long does it take to place an order? If customers must play phone tag with you or encounter other sales barriers, they'll quickly move on.

• Delivery. How do your delivery costs and schedule compare with those of your competitors? If others deliver electrical supplies in 48 hours or less and you offer same day delivery, for example, you'll have a definite marketing advantage.

• Inventory. Reliability is a vital and highly marketable feature. Do customers receive exactly what they ordered when they need it? Have at least the same number of products available as your chief competitors, or customers may assume your business is too small to depend on regularly.

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Features such as top-quality service, on-time delivery and complete inventory enhance your company's value and add up to an important benefit-peace of mind. Build these elements as well as cost savings into your marketing message and then set up an ongoing program that includes contact with your database at least every six weeks. It takes an average of eight contacts with a prospect before a sale is closed. So if you're not continually asking for the business, you can bet your competitors are. Communicate via direct mail, broadcast fax, telephone and in person. And regularly mail postcards with brief survey questions to current customers to gauge their satisfaction and future needs.

Kim T. Gordon is a multifaceted speaker, marketing expert and media spokesperson-and one of the countryis foremost experts on entrepreneurial success. Her newest book, Bringing Home The Business (Perigee, $13.95, use http://www.smallbusinessnow.com/books.htm), identifies the 30 "truths" that can make the difference between success and failure in a homebased business. From formulas for positioning a business and creating an image to Internet marketing strategies and tips for work-at-home parents, by reading just one truth per day, in one month, readers will master a complete course on homebased business success. To read an excerpt, get information on media appearances and seminars, receive free how-to articles and advice, or contact Kim, visit http://www.smallbusinessnow.com.

The opinions expressed in this column are those of the author, not of Entrepreneur.com. All answers are intended to be general in nature, without regard to specific geographical areas or circumstances, and should only be relied upon after consulting an appropriate expert, such as an attorney or accountant.