How to Sell Extended Service Warranties:
Training Employees to Sell ESPs
Part 3 of 3
by Tom Egelhoff
In this final segment of selling Extended Service I'll cover how to set up your own training program and ways to improve the performance of your employees.
The first point to keep in mind is that anything that can be measured can be improved. If you were going to run the 100-yard dash in the Olympic games what would you do?
Wait for the games to roll around and then just meander on down and take your chances? Or, would you run a single 100-yard dash and time yourself?
I would hope you would consider the latter.
How To Create A Training Program for Extended Service Warranties
After you know your base time and you know the world record and you can design a training program to pare down the difference between the two times.
In order to be successful you'll want to set up a similar program for your employees. Here's how to do it.
If you've been keeping records of extended service sales for each employee then you have a base to improve on and you are slightly ahead of the game.
If not, then start keeping track of how many extended service contracts each sales person sells but do it without their knowledge.
This part is very important. You must have a base that reflects their current ability level. If they're trying to empress you too soon, without the training that will follow, then the road to success will be that much harder.
In addition they may begin to develop some bad habits.
As much as you might think that selling extended service is an individual effort it is actually a team effort and the training I suggest will create a positive work environment and not an adversarial environment.
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Provide An Incentive To Sell ESPs
After you have a track record of each employee announce that you will have a meeting each week for a month. You may be doing this anyway.
At this first meeting ask each salesperson to tell you about something they wanted to buy but just didn't have the funds.
For example it might have been a new leather jacket for $300.00.
Translate the cost of the jacket into numbers of ESP's that the salesperson would have to sell to afford the jacket.
Have them write down the item to be posted in the break room for everyone to see. Now each person has a goal that selling ESP's will accomplish.
Next explain that you will meet again in a week to report on how much closer each one has moved toward their goal.
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Each Indivual Is More Important Than The Team
This next part is extremely important. Under no circumstances do you reveal any ESP numbers of any salesperson publicly during this training period.
Instead meet with each salesperson individually and review their numbers privately. What you don't want is each salesperson competing against the others.
Competition or contests will happen down the road after they have gained a strong level of self-confidence and are ready for competition.
Competition at this point will only create animosity from the weaker salespeople toward the stronger.
Remember what I said earlier? You want the final result to be a team effort, not an individual effort.
What you want them to do is first compete against their best record and see self-improvement before they compete against others.
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Hold Regular Training Sessions
Now you are ready to begin the training and create a supportive team effort. Meet with each salesperson and give them their ESP sales figures.
Let's say that Joe typically waits on an average of 20 customers per day and averages 2 ESP per week. So if Joe works five days a week he waits on 400 customers per month and sells 8 ESP's.
Joe is selling ESP's to only 2% of his customers.
There's obvious room for improvement. Joe can't be asking every customer to buy an ESP.
So for the next week our goal for Joe is not to sell more ESP's but to simply set a goal of asking every single customer to buy one.
If Joe will commit, this alone should improve his numbers. That will be his only goal for this week.
Let's take Mary next. She waits on the same 400 customers but sells 20 ESPs' per month. Over twice what Joe does.
But although Mary has a good sales percentage she is selling one year ESP's rather than two or three year ESP's.
With Mary we might have two goals. One, make sure that she also asks every single person to purchase the ESP but in addition to make sure that she always presents the longer ESP each time and tries to overcome at least two objections to the longer period.
I would also ask her to collect any customer objections to the longer contracts and bring those to the next meeting for discussion among the sales staff.
That way the team can help her develop techniques to overcome those objections.
At the same time the rest of the staff is also learning how to handle those same objections during their own sales.
Using these techniques the entire group becomes stronger at each meeting. They begin to rely on each other and each person becomes a teacher.
And last but not least. Don't post who sold the most and who sold the least. Instead report on who improved their individual numbers and congratulate them for their improvement.
The object of this type of training is to build self-confidence and inner strength to overcome fear of rejection by using the entire sales staff as a support unit.
As each salesperson grows in ability so does your stores bottom line. Give it a shot. I know from personal experience it works.
Part One - Click Here
Part Two - Click Here
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Based in Bozeman, MT, Tom Egelhoff is the author of How To Market, Advertise & Promote Your Business Or Service In A Small Town, and The Small Town Advertising Handbook: How To Say More And Spend Less. He is also a seminar and workshop presenter and trainer. He may be reached at 406-585-0219 or PO Box 271, Bozeman, MT 59771-0271
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