Monthly Archives: August 2013

Lead Generator #17 – Sales Agents & Reps

Using a sales agent sounds like the ideal method for those who don’t like sales and marketing. Just pay someone else to do it, right?.

Unfortunately, nobody cares for your business like you do, so I do NOT recommend this as a primary source of business. To be blunt, if you are not ready and willing to market and sell, you are not ready to start a consulting practice!

But done correctly, agents and reps can generate incremental business. It has worked for us, and we are even included on one manufacturing rep’s line card. We are also listed in a training catalog. While neither is a major source of business, it is still good business and much appreciated.

Here are some comments on dealing with sales agents and reps, based on my 25 years as a full-time consultant — 7 years as a field sales engineer — and 2 years managing independent sales reps.

  • Synergy – Look for someone already in your market niches. For example, both our rep and our training firm serve the same business niches we do. They are already in front of the right people, so it is easy for them to offer our services as an add-on.
  • Share of mind – Good sales people are busy. Keep in contact — out of sight, out of mind — but don’t overdo it. An occassional e-mail or phone call will suffice. If/when the opportunity arises, offer to buy them lunch or dinner (or even a beer.)
  • Support – Good sales people value their time. It is a precious resource. Make it easy for them — provide materials, answer questions, and follow up right away. And don’t be bossy — rather, ask what they need and how you can help them.
  • Payment – Good sales people are motivated by money. Don’t expect things for free. We pay commissions as follows:
    –10% on a lead. We follow up, close the business, do the work, and bill the client.
    — 20% on a purchase order. We do the work and bill the client.
    — 30% on paid business. We do  the work, then and get paid for it.
    Our payments are based on fees only, but not expenses. They get paid when we get paid. And we mail their check out right away — no delays.
  • Agreements – You need an agreement or memo of understanding that spells out terms and responsibilities. Keep  it short, but it must be signed by both parties.

So how do you find a suitable sales person? Network and cultivate contacts.

A good place to start is trade shows. Ask companies in your market place who they use. This is particularly useful if you are targeting a specific locality. Most people will share this, as long as you are not seen as a potential competitor.

Another good place is professional organizations. That is how we met our manufacturer’s rep, along with several clients. Local  chapters are particularly effective — they are like watering holes where everybody regularly meets to quench their business thirsts.

What kind of sales person are you looking for? Briefly, here are four classes of sales personnel:

  • Reps – Also known as manufacturer’s representatives. These are often small independent sales organizations who focus on both a business niche and a geographical niche. They usually operate on full commission, do not carry products for sale, and are paid upon sales/delivery. We are on the “line card” of one rep who serves our business niche.
  • Resellers – Like reps, there are often smaller firms that specialize in marketing services to specific business niches. One example is firms who match-make expert witnesses with law firms. Another is training catalogs, a method we use. Like a rep, both make their money upon the sale.  (Unfortunately, there are charlatans who want advance payment — my advice — don’t do it.)
  • Distributors – These are usually larger organizations, but may also focus on business niches. They usually carry products for sale, and may offer ancillary services. The latter is where you may fit as a consultant, particularly if you serve a special niche. We’ve done business this way.
  • Field sales – These are full time company employees, and likely can not represent you, but may provide contacts as they have a lot of visibility into their territories. I was a field sales engineer (Intel & Tektronix) for seven years, and often passed along leads to consultants as a courtesy (no fees.). In return, they advised me of potential sales opportunities.

Don’t overlook other professionals or similar businesses. Depending on the business, fees may or not be the norm. If no fees are involved, do your best to return the courtesy. Don’t take without giving back.

Finally, avoid conflicts of interest. As Registered Professional Engineers (PE), we do NOT pay fees to non-sales organizations, nor do we accept fees for referrals. Neither are allowed by our rules of professional ethics.

We do pass leads and recommendations along as appropriate, and we make sure our clients understand that no money changes hands. Keeps it clean and simple.

Hope his has given you some ideas on how you might use existing sales organizations. But you still need to do the bulk of the sales and marketing yourselves — at least if you want to stay in business!

© 2013, All rights reserved.

Do You Own a Business… or a Job???

Here is an interesting comment recently posted on LinkedIn that I thought might be of interest:

Do You Own a Business or Do You Own a Job?

This question was posed to me not long ago. I have often considered whether “I owned a Business or it Owned ME!”

But when I was asked the above question I must admit I was taken back for a few minutes trying to decide just what I was being asked.

When I asked for clarification I was then asked what would happen to my business if I were to walk away from it for 4 to 6 weeks. My response was it would stall out and likely crumble to nothing.

At that point I was TOLD I owned a Job! If I had a true business regardless whether I was out sick or just on vacation the truth was a business would run without me, maybe not as good or efficient .

But truth being told I was the business or in short I Owned a JOB!

More on LinkedIn…

Here are my comments:

I’ve heard this “argument” before, and frankly, I consider it a put-down.

What was the questioner’s agenda? Were they trying to sell you something? Or were they simply jealous that you were independent, while they were not?

So What? It’s YOUR business, job, or whatever you want to call it. It’s YOUR life too. Do what makes sense, and what makes YOU happy. If you want to grow, go ahead. If you want to stay small, that is fine too.

As a consulting engineer (partner – two person firm), I’ve spend the past 25+ years doing the latter. Some days it is a job, some days it is a business, but EVERY day so far has been a joy! No regrets either!

Finally, it sounds to me like you have your act together. Ignore the naysayers, and enjoy the journey, regardless of what you call it.

My sincere best wishes!

PS – Now blogging (sharing my experience) on how to start a consulting practice… or is it a business… or is it a job … or is it a lifestyle… or ??? 🙂

A subsequent comment quoted Michael Gerber — the E-Myth guru – who said “Most small businesses are owned by technicians who suffered an entrepreneurial  seizure.”

Gerber is a strong advocate of growing a business so you can sell it. (He even built a consulting firm around the concept!) Good info if that is your ultimate goal. Not so good if you just want to stay small and independent.

Here are my additional comments:

Read the E-Myth a few years ago, and found it interesting. But I was a little annoyed on his view of “technicians.” Not everyone wants to be a manager — many want to be producers. Society needs both.

What if every doctor wanted to run a hospital? Who would do the surgeries? What if every engineer wanted to manage? Read Dilbert lately?

About a dozen years ago, my business partner and I seriously considered growing our consulting firm. Business was good, and we were already subcontracting our overflow business.

But then we decided not to. Why? We both realized that while we enjoyed working directly with our clients, neither of us particularly enjoyed managing others.

Was it the right decision? For us, yes. Would we have made more money growing the firm? Not sure — but we were not making much money on the subcontractors anyway. But it doesn’t matter, as our little “technician” business eventually made us both financially independent.

So, grow if YOU really want to. Gerber’s book can help. But don’t do so just because some business “guru” (or anybody else) says you should.

Hope this helps!

An interesting discussion, and all very polite. So, what are YOUR thoughts?

© 2013, All rights reserved.

Consulting as a Side Hustle…

Thinking about consulting, but not ready to go full time? Then consider consulting as a side hustle. You will learn a lot, and it will be much easier if/when you make your full-time JumpToConsulting.

First heard this phrase back in 2010 from fellow Arizona blogger Pam Slim at Escape From Cubicle Nation. I’ve sung her praises before, and will continue to do so. Unlike too many Internet bloggers/marketers, Pam is the real thing —  genuine, caring, and full of great advice and insights on starting ANY business.

But enough of the accolades. When I heard the term, it immediately resonated — for that is exactly how I got started in consulting over 30 years ago. Not ready to jump in full time, the part time route was a great way to test the waters to see if I would even like consulting in the first place.

The side hustle also brought in some extra bucks. With two kids at the time, any extra moolah was welcome. It even provided a tax shelter of sorts, by investing profits in some new fangled personal computers. (Have we come a  long way from that first Apple II…)

But most important, the side hustle provided a place to try ideas. Some worked, and some didn’t. The biggest disaster was a foray into computer seminars — but I learned an important lesson about barriers to entry. The biggest success was learning how to market consulting —  different from most traditional businesses.

So what was the original side hustle? We began teaching adult evening electronics classes at a vocational school (now part of the University of Minnesota system.)  My business partner had just started, and recruited me when another instructor had to drop our at the last minute.

Although I never taught before, it sounded like an interesting challenge. The challenge turned out bigger than expected, but I survived (as did my first students.) Actually, we all learned together, and my class reviews were positive.

That following spring, the school asked for help in organizing their evening electronics curriculum (a bit of a mess.) Recognizing an opportunity, we submitted a proposal. We had just  recently attained our PE (Professional Engineer) licenses, so we felt a nominal fee was warranted. We called ourselves Kimmel Gerke Associates.

The school jumped at it. When the dust all cleared, we probably earned a few dollars an hour. But we had tasted blood, and we had our first job under our belts.

We did many subsequent projects for the school (at improved rates). These included developing/presenting on-site training for several local companies (anybody remember BASIC?) The capstone was winning a state grant to develop a multi-year program on printed circuit board design, which was a nice chunk of change.

Other consulting projects began to emerge too. We were approached by a local county medical society to help them select a computer system. A small manufacturer asked us to develop a marketing white paper. Our side hustle was starting to generate some serious side income.

So why didn’t we break free? Well, actually I did — for three months. It took that long to realize I still needed to learn a LOT more about consulting, and I also needed to have a LOT more money in the bank.

Back to the corporate world I went, sadder but wiser — and also more determined that ever to make my own JumpToConsulting. It finally happened several years later, but it might never have happened without the original side hustle.

What about YOUR side hustle? Here are some things to consider:

  • Do you enjoy it? No sense doing it if it isn’t fun. After all, it is YOUR hustle.
  • Can you make money at it? The  bottom line.  But if your are not sure, a side hustle can be a good way to test a market without risking everything.
  • Any conflicts of interest? This is both an ethical issue, and a practical issue. Not a good idea to risk you day job over a side hustle. Keep it legal too.

Make a list of possibilities. A good place to start is Pam Slim’s original post, “What’s Your Side Hustle?” Be creative, and add your own ideas – even if the seem esoteric. Who knew there was a market for a couple of Electromagnetic Interference engineers?

Finally, give some thought to WHO your potential clients are, and HOW you would reach them.  This is called marketing — the linchpin of small consulting practices. No clients — no business.

Hustle on!

© 2013, All rights reserved.

A success story…

Just got this e-mail from “C,” who you have already met in previous posts. We kept her name private, but she is now happy to share some details of her brand new consulting practice.

Catherine helps organizations better organize, analyze, and use their client/member databases using mapping technology. This is based on her years of experience providing this service for government agencies.

What an interesting consulting niche! And what a great example of leveraging specialized experience, and transferring specialized technology to new markets.

Hi Daryl,

I’m sure it seems like I dropped off the face of the earth, but alas I got my first check for my very first client this past Friday.

Which was a totally different client than the one I thought was going to be first. (They are still interested so they claim but are not moving forward.)

My first (real) client wanted a poster size map of their family farm with boundary lines, aerial photo, and topography.

I had invoiced them on June 17 and when 30 days went by with no payment (the payment terms on invoice) I had to give a little nudge but check was delivered on Friday July 26.

So I am OFFICIALLY in business 🙂

All the best — Catherine

Here is my reply:

Hi Catherine,

CONGRATULATIONS! Yes, you can now say you are OFFICIALLY in business. Feels great, doesn’t it?

Not terribly surprised that the first one didn’t pan out right away – that is often the nature of this business. You need to keep on turning over new rocks.

And now, onward and upward to the next client, right?

Thanks for sharing your success! — Daryl

We first connected via Mr. Money Mustache, my favorite blog on financial matters. Written by another engineer who achieved financial independence at the tender age of 30.

No magic either — just a combination living below his means and stashing away as much as he could for several years. Similar to the focus and discipline it takes to start a consulting practice (or any other small business.)

Catherine is following the same path, and is using her part-time consultancy to improve her retirement stash. Way to go, Catherine!

Since then, we’ve exchanged a few e-mails, some which are summarized in my blog.

It delights me to hear of her success… it’s one of the reasons I started this blog!

To find out more, visit Catherine’s web site at So, any success stories YOU would like to share?

© 2013, All rights reserved.

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