3 Steps to Increased POS Sales

Get a free personal computer if you upgrade your POS system with us!" "10% off the purchase of a new cash register." If you're the customer, these real examples might appeal to you. However, as a VAR, you might be experiencing shortness of breath at the lost revenue. While giving away huge discounts and gifts may help win business, it's not the answer to boosting sales that any VAR wants to hear. To improve sales you could choose to expand your product and service line, but that might mean years of research or huge outlays of cash. So what can you do to increase sales now? Michael Milligan, owner of Salinas Cash Register (SCR), might have some answers. Milligan has three simple steps that anyone can use to increase sales. Simple, but not necessarily easy.

Step 1 — Maximize The Number Of POS Leads You Receive
Almost every book on business success discusses the importance of networking. It's time-tested, and clichés such as, 'It's not what you know, it's who you know,' exist because they're often true. Milligan takes full advantage of networking by proactively creating opportunities to interact with local businesspeople. "When I first got into sales, a coworker of mine would come into work with all these leads," explains Milligan. "I asked him where he was getting them, and he explained that they came from his discussions with people he was having breakfast with." Further investigation led to the discovery of what Milligan refers to as a 'tip club.' Here's how it works: Milligan calls a restaurant and sets a reservation for approximately 15 people in a private setting. He then contacts local salespeople in areas such as advertising, telecommunications, office equipment sales, accounting, general contracting, and liquor sales. "It's very important that you invite only one person from each type of business to avoid conflicts," explains Milligan. As you might have noticed, the wide variety of people invited ensures a wide variety of information sources. The person in liquor sales might know of a new restaurant opening. A general contractor might know of a new store being built. The accountant might know about an ownership change. Therefore, each person who comes to breakfast is to bring one lead — or tip — for another person. As a soft penalty for not bringing a tip to breakfast, members are penalized 25 cents, which goes toward funding one yearly get-together. Milligan coordinates these breakfasts every other week and tries to keep them to 45 minutes in length. He recommends starting with five people. Adding members requires the existing members to vote them in. Participating in the tip club has helped Milligan increase his POS sales. In fact, he estimates that of the tips he's received during the breakfasts, he closes 40% of the deals.

SCR also pays for a number of services to help obtain leads for new business. The VAR pays to be listed as a POS vendor on Buyer Zone, a Web site dedicated to connecting buyers and sellers of business products and services. "Our Web site comes up in the top three when a buyer searches for cash registers, California, or Monterey County," says Milligan. "I pay Buyer Zone $15 per lead they send me, which includes all the contact information I need to move ahead with a sale." Milligan says that the Buyer Zone service has more than paid for itself, as he has been able to close 25% of the POS leads passed to him. In addition, SCR receives information from the Business Extension Bureau. As a subscriber, SCR is able to specify ZIP code ranges and request information for business events such as partner changes, bulk transfers (when a business is sold, it must be publicly posted so debtors can take action if necessary), liquor license applications, and incorporations. Milligan gets an average of four lead envelopes per week from the service. Finally, SCR subscribes to its local credit bureau at a rate of $27 per month. This is a source of information for such business events as tax liens (people who haven't paid the bills), judgments against people or companies, bulk transfers, liquor license applications, and bankruptcies.

Milligan's experience has taught him that the first salesman to present to a customer has the advantage in actually getting the sale, and, therefore, he uses all of the above information sources to find cases where SCR's services may be needed. For instance, upon reading about a restaurant getting into financial trouble for not properly accounting for employee payroll, Milligan sold them a new POS system that had the payroll functionality the restaurant's previous system was lacking.

Step 2 — Make Your Name Synonymous With POS
If a potential customer is looking in the phone book for a list of POS VARs, Milligan wants the overwhelming choice to be SCR. He guarantees this by purchasing multiple ads within the same yellow pages category. SCR has 10 ads total. Of these ads, the VAR has a separate entry for each of the major brands that it carries. In addition, SCR has a quarter-page ad and pays for premium positioning. At an extra cost of $360 a year, premium positioning guarantees the company's ad as 'first in column' despite not being the first alphabetically. What this has done is monopolize the page, diluting the presence of SCR's competition in the POS space. In fact, highlighting the SCR ads would result in nearly 80% page coverage. SCR pays $6,000 a year for its ads in the AT&T yellow pages. The company also advertises in a second yellow pages directory for $4,200 a year.

During the summer months, Milligan hires college students to supplement his sales force. "I'm trying to dominate my region," says Milligan. "We try to be seen everywhere. Because the students out of school are looking for jobs, I pay $10 per hour for them to canvas areas in my city, visiting our existing and potential POS clients while wearing SCR polo shirts." SCR has 2,300 active POS customers in its tri-county region. As a form of free advertising, it's important to Milligan that all of those customers have an SCR sticker on the front and back of the POS equipment. The hired students get paid a bonus of 25 cents per sticker distributed.

Milligan also has the students gather information with a short survey form. "We ask for some basic pieces of information, including store name, store manager, phone number, make and model of POS equipment, and where they buy their supplies," says Milligan. "I've heard nothing but good things from customers. They seem to enjoy the contact."

Step 3 — Personal Relationships Help Sell POS
Milligan is a firm believer of the soft sell. That is, he never wants potential customers to feel pressured to make a decision. His soft sell technique begins with his business card. "Whenever I meet someone and give them my business card, I always flip the card over and show them the list of brands we carry," says Milligan. "I also point out that on the back of the business card is my personal e-mail address and tell them that if they need anything, they should feel free to send me an e-mail at that address." The e-mail address name? Bigredschili. Milligan explains that the conversation instantly turns to, "Why such a funny name?" Well, Milligan is a competitive chili cook and uses that to his advantage as a conversation point. He carries, and freely gives out, copies of his family-favorite chili recipe as well as some recipes from past world champions. In fact, his family-favorite recipe also includes his home telephone number in case there are any questions when making the chili. "With the simple handing out of a business card, I've taken it from, 'See the feature of this POS equipment?' to a personal relationship where the customer feels comfortable with me," says Milligan. He adds that even if you don't have a unique hobby, passing out your personal contact information goes a long way toward building a trusted-advisor relationship with customers.

To stay connected to his community, SCR has a subscription to three area newspapers, which Milligan reads every day. "You never know what useful information you'll find in the newspaper," says Milligan. "For instance, a while ago I walked into a local business with only a business card in my hand. Inside, the manager was berating an employee and was very upset. The employee stormed off, and the manager turned to me and angrily said, 'What do you want?' I replied, 'All I want to do is give you my business card and ask your name.' He took the card and told me his name. When he told me his name, I recalled that I had read in the newspaper that a man by his name recently had twins. After I asked if that was him, he said, 'I did, and I've got time for you.' We talked about the kids, looked at photos, and the next week he bought three cash registers from me."

Another way Milligan promotes a personal touch is by sending thank- you cards. Because it's easy to get sidetracked or not have a stamp handy, Milligan carries prestamped envelopes and a small assortment of greeting cards. "If someone does me a favor or I find out about a birthday, I can fill out a card in my car immediately following the appointment and send it out," says Milligan. "It adds to the personal touch that's important to a successful business."

It's easy to see why this works. POS is a face-to-face business. It's one of the few businesses where a handshake can still seal a deal, and relationships often are more important than what brand of hardware is being purchased. Obviously, sending a card is a small gesture, as are most of the things SCR is doing. Milligan looks at all these things as little tools to help SCR be successful. Individually, they might not mean anything, but as a complete package, they're helping SCR achieve what Milligan expects will be 18% sales growth this year.