The New Rules of Selling
There is no doubt that this environment has produced the need for a change in strategy for those of us who are in business. Starting within the housing industry, the progression of the fiscal crisis is being felt across every industry and all around the world.
It is a crisis that affects confidence and the average consumer is less likely to purchase our goods or services. We know that confidence will return in the future; yet, the rules we follow will have changed perhaps forever. How are the new rules likely to be different?
The issue of qualification. In the past, if someone wanted to purchase something, we sold it to them as long as they qualified. Our challenge was to get people qualified. Well, now the challenge has become ten times harder. As incomes drop and financial situations worsen, the criteria to get someone approved has become significantly more stringent.
The result of poor financial situations and tighter credit is quite striking.In the past, there may have been difficulties but 90 percent of the people qualified.Now in some industries such as housing, many areas are seeing over 50 percent of the prospects not in a situation to purchase because of their qualifications.
The issue of suitability. The lenders are certainly doing a better job of making sure that the purchase is more suitable for the client and we don’t expect that criteria will move back to where it was four to five years ago. As the economy gets better, lender qualification standards will likely ease. However, we will still face the issue of suitability.
No more will our responsibility be to grant anything to anyone who can qualify for the purchase. What happens in the future if the prospect’s financial situation changes? What happens if the value of the asset they are purchasing or investing in changes? How does the purchase of a service or product affect the ability of someone to achieve his/her long-term goals? Today, the issue of the day is qualification. Tomorrow, the issue of suitability will become even more important.
Investments. In the past, most took the stance that investing in real estate and stocks constituted a conservative long-term investment. We don’t expect that these ideas will change. However, we do believe that strategies will change. For example, note that we have always felt that these investments were conservative in the long-run, but did the general public and the professionals who serve them act in this manner?
There were millions who purchased homes to flip them. There were millions of retired people who had their money tied up exclusively in the stock market.Long-term means exactly that – long-term. This means that those who can’t wait out a five-to-ten year slump should not be acting without considering future consequences.
How we help people. We now must not only take a broader view of how our service or product will help someone achieve their long-term goals; but we also must take a broader view of how we can help someone achieve their goals. This financial crisis has translated into significant challenges for the average professional. The crisis also offers opportunities. We now have the opportunity not only to help people get qualified for purchases as well as the opportunity to help put them in position to achieve their long-term goals.
Let us take the issue of credit scores.
Many can’t purchase a home, car or even insurance because of their score. In the past, the solution was to do enough work to raise their score and effect the purchase. Now we must realize that our prospect will never prosper financially with a score that meets minimums. They will continue paying more for everything for the rest of their life.
The solution is to get them on a long-term plan to raise their scores and keep them higher in the long-run. If you are a credit professional, that may be your job. On the other hand, if you are not a credit professional, you may have to work with such an expert. This extra value will help in the long-run and your guidance will pay off in many ways – especially loyalty as your customer becomes an advocate for life.
Helping your clients reach above the minimum requirements helps you achieve your maximum results, Call on us to help you look like the hero, our team of trained and skilled ISA’s won’t mind being your trusty the side kicks. We are good at that.