10x Revenue with 1 New Sales Process... Here's How

Summary

The speaker shares his expertise in scaling companies by focusing on the sales process, particularly the 'diagnostic sale'. He outlines a five-step process involving pre-sale questionnaires, credit card information gathering, understanding customer situations, identifying obstacles, and presenting a solution tied to overcoming these obstacles. He emphasizes the importance of secret shopping, anticipating objections, and implementing a diagnostic sales process to increase customer lifetime value. The speaker also discusses transitioning to a recurring revenue model and offers strategies for sales step-downs, demonstrating how these techniques can significantly increase a business's revenue and customer engagement.

Takeaways

• 💰 The speaker crossed $100 million in net worth by age 32 and sold a company for 46.2 million, attributing success to the ability to grow and scale companies.
• 📈 They purchased a business with 14 locations and grew it to 32 locations in a year, using a sales process called the 'diagnostic sale' to increase recurring revenue significantly.
• 🔍 The diagnostic sales process involves a pre-sale questionnaire to understand customer needs and pain points, which is crucial for tailoring sales approaches.
• 💡 The process also includes collecting customer information and credit card details early to streamline future transactions and increase the likelihood of sales.
• 🛒 The speaker emphasizes understanding the current situation and desired state of the customer, identifying obstacles, and presenting a solution tied to overcoming those obstacles.
• 🔑 A key step is 'secret shopping' the business to identify real-world customer experiences and areas for improvement in the sales process.
• 🎯 By focusing on offer and packaging constraints, the business was able to increase rebooking rates, which was identified as a significant opportunity for growth.
• 🤔 Anticipating objections, or 'killing zombies', is crucial to prepare the sales team to address potential customer hesitations before they arise.
• 🔄 The diagnostic sales process was implemented in a service business, transforming a transactional sale into a more customized experience without changing the core service.
• 💸 The implementation of the new sales process led to a 4X increase in Lifetime Value (LTV) progresser, demonstrating the effectiveness of the diagnostic approach.
• ⏳ The speaker suggests transitioning to recurring revenue models, such as payment plans or memberships, to increase customer retention and revenue stability.

Q & A

What was the speaker's first significant achievement in business?

The speaker crossed $100 million in net worth by the age of 32 and sold their first big company for 46.2 million.

What is the speaker's current business strategy?

The speaker buys companies at a lower price, grows them, and then sells them for a profit.

How did the speaker grow a recently acquired company from 14 to 32 locations?

The growth was achieved by focusing on the sales process and implementing a method called the 'diagnostic sale' to increase recurring revenue across all locations.

What is the purpose of the pre-sale questionnaire in the diagnostic sales process?

The pre-sale questionnaire aims to gather more information to arm the salesperson, understand the customer's needs and pains, and increase their awareness of the problem.

Why is obtaining the customer's credit card information early in the sales process considered key?

Obtaining the credit card information early streamlines the sales process, as it eliminates the need to ask for it again when making a sale.

What is the significance of understanding the customer's current situation and desired state in the diagnostic sales process?

Understanding the customer's current situation and desired state helps in identifying the obstacles and tailoring the sales pitch to overcome them, presenting a solution that aligns with the customer's goals.

What is the 'diagnostic sales process' and how does it differ from transactional and enterprise sales?

The diagnostic sales process is a method that bridges transactional and custom sales, focusing on understanding the customer's needs and presenting a personalized solution. Unlike transactional sales that fit the customer to the product, and enterprise sales that involve complex decision-making, the diagnostic process tailors the presentation of a standard product to feel customized.

How did the speaker implement the diagnostic sales process in a gym business?

The speaker used a pre-sale questionnaire to understand the customer's fitness goals and obstacles. They then presented a personalized plan focusing on fitness, nutrition, and accountability, and tied the price to achieving the customer's specific goal, offering a guarantee.

What is the importance of 'killing zombies' in the diagnostic sales process?

'Killing zombies' refers to anticipating and preparing for objections or obstacles that potential customers may raise. This strategy helps to address concerns before they become barriers to the sale.

How did the speaker's approach to sales increase the average revenue per customer in a medical service business?

The speaker shifted from selling one-off transactions to presenting a customized solution tied to the customer's desired outcome. By doing so, they increased the average revenue per customer from $200 to $800.

What is the final step in the diagnostic sales process as described by the speaker?

The final step is transitioning to recurring revenue. This involves offering customers the option to prepay for a discount, setting up payment plans, or transitioning to a membership model to secure ongoing business.

Outlines

00:00

💼 Scaling Companies through Strategic Acquisitions and Sales

The speaker discusses their success in scaling companies and increasing net worth, highlighting a significant business acquisition that grew from 14 to 32 locations. They attribute this growth to a focused sales process known as the 'diagnostic sale,' which involves a pre-sale questionnaire to understand customer needs and a structured approach to presenting solutions and overcoming obstacles. The process aims to increase awareness of the problem, secure customer information, and tie the price to the proposed solution, ultimately leading to a 10x increase in recurring revenue across all locations.

05:01

📈 The Diagnostic Sales Process: Enhancing Business Value

This paragraph delves into the five-step diagnostic sales process used to transform a business with a focus on offer and packaging constraints. The steps include secret shopping to gather firsthand experience, information gathering to identify business opportunities, anticipating objections, and implementing the diagnostic sales process. The speaker shares a case study of a business where the implementation of this process led to a fourfold increase in customer lifetime value without changing the core service but by changing the presentation and packaging of the services.

10:03

🎯 Transitioning from Transactional to Customized Sales

The speaker explains the shift from a purely transactional sales approach to a more customized one, using the example of a gym membership sale. They describe how a traditional sale focuses on fitting the customer to the product, whereas a customized sale feels personalized. The diagnostic approach involves a pre-sale questionnaire to understand the customer's needs and goals, and then presenting a tailored solution that bridges the gap between the customer's current situation and desired outcome, which can significantly increase the average revenue per customer.

15:05

🛠️ Applying the Diagnostic Sales Process to Different Industries

The paragraph illustrates how the diagnostic sales process can be applied across various industries, such as weight loss services and medical aesthetics, to increase customer value and business revenue. The speaker emphasizes the importance of understanding the customer's current state and desired outcome, and then presenting a solution that ties directly to achieving that outcome. They also discuss the importance of packaging and the psychological impact of customer control in the purchasing process, which can lead to higher customer satisfaction and retention.

20:06

📊 Leveraging the Diagnostic Sales Process for Recurring Revenue

The speaker discusses the importance of transitioning to a recurring revenue model and shares strategies for increasing the customer's lifetime value (LTV). They explain the concept of 'sal step downs,' which involves offering different payment options, such as prepayment discounts, partial payments, and credit or third-party financing. The goal is to make it as easy as possible for customers to commit to the service, thereby increasing the likelihood of recurring revenue and customer retention.

25:08

🚀 Scaling Business Growth through Repackaging and Sales Optimization

In this paragraph, the speaker shares the remarkable results achieved by applying the diagnostic sales process to a business they acquired. They detail the significant increase in recurring revenue, from 9% to 60%, the introduction of memberships, and the increase in customer visits from one to four to six times. The speaker also highlights the substantial growth in monthly revenue from $20,000 to over $250,000 by focusing on repackaging and optimizing the sales process of existing services.

Keywords

💡Net worth

Net worth refers to the total value of an individual's assets minus their liabilities. In the video, the speaker mentions crossing $100 million in net worth by the age of 32, indicating their financial success and serving as a foundation for their credibility in discussing business growth and sales strategies.

💡Diagnostic sale

The diagnostic sale is a sales process the speaker introduces, which involves understanding the customer's current situation, desired state, and obstacles to achieving that state. It is central to the video's theme as it outlines a method for growing businesses by increasing recurring revenue through a tailored sales approach.

💡Pre-sale questionnaire

A pre-sale questionnaire is a tool used to gather information about potential customers before engaging in a sales pitch. In the script, it is mentioned as the first step in the diagnostic process, aiming to arm the salesperson with knowledge about the customer's needs and pain points.

💡Obstacle

In the context of the diagnostic sale, an obstacle is what stands between the customer's current state and their desired state. Identifying the obstacle is crucial as it allows the salesperson to present a solution that directly addresses the customer's main concern, as illustrated in the script where the sales process is detailed.

💡Secret shopping

Secret shopping involves an individual posing as a customer to evaluate a business's sales process and customer service. The speaker highly recommends this practice, sharing their experience of discovering shortcomings in their own sales team's approach, which led to improvements in the sales strategy.

💡Offer constraint

An offer constraint refers to a limitation in how a business's products or services are packaged and presented to customers. The speaker identifies this as a key area for improvement in the businesses they acquire, using it as an opportunity to enhance the sales process and increase value.

💡Rebooking

Rebooking in the script refers to the act of scheduling a customer for another session or service. The speaker notes that increasing rebookings was a significant factor in growing the business, indicating the importance of repeat customers and the effectiveness of the diagnostic sales process.

💡Transactional sale

A transactional sale is a one-time exchange of goods or services for money. The speaker contrasts this with a more customized or enterprise sale, highlighting the need to move from a purely transactional approach to one that feels personalized to increase the value and efficiency of sales.

💡Custom sale

A custom sale involves tailoring the sales process to fit the specific needs and desires of the customer. The video emphasizes the importance of customizing the sales approach without changing the core product or service, which helps in creating a more engaging and effective sales strategy.

💡Recurring revenue

Recurring revenue refers to income that a business receives on a regular basis, typically from subscriptions or regular payments. The speaker discusses the transformation of a business's revenue stream from one-off transactions to recurring revenue, which is a key indicator of business growth and stability.

💡Sales step-downs

Sales step-downs are alternative offers presented to customers when they are hesitant to commit to the full offer. The speaker outlines a strategy of offering prepayment discounts, partial payments, and payment plans as a way to increase the likelihood of a sale and improve customer retention.

Highlights

Achieved a net worth of $100 million by age 32 and sold a company for $46.2 million.

Specializes in buying, growing, and selling companies, with a focus on enhancing sales processes.

Implemented a diagnostic sales process to increase recurring revenue by 10x in a business with 14 to 32 locations.

Utilizes a pre-sale questionnaire to gather information and understand customer needs.

Collecting customer information and credit card details early in the sales process is crucial.

Understanding the current situation and desired state of the customer is key to diagnosing obstacles.

Presenting the desired state and offering a solution to overcome obstacles with a clear pricing strategy.

Secret shopping as a method to understand the business from a customer's perspective.

Identifying offer constraints and opportunities within a business through data gathering.

Anticipating objections by 'killing zombies' to prepare the sales team for customer pushback.

Positioning the sales team as trusted experts using childlike curiosity to engage customers.

The importance of being willing to lose an argument to win a sale.

Moving from transactional to custom sales to create a personalized experience without changing the product.

Using a diagnostic approach to sell a gym membership by linking services to customer goals.

Applying the diagnostic sales process to different service businesses for scalability.

The strategy of transitioning to recurring revenue models to increase customer lifetime value.

Increasing the average revenue per customer from $200 to $800 by changing the sales approach.

The concept of sales step-downs, offering various payment options to secure the sale.

Achieving a 10x increase in recurring revenue by repackaging and applying a diagnostic sales process.

Transcripts

I crossed $100 million in net worth by

age 32 I sold my first big company for

46.2 million and the reason we're able

to do that is because we know how to

grow companies and so now I buy

companies at a lower price I grow them

and then we sell them and so I want to

talk to you about one of the companies

we just bought uh we bought them a year

and a half ago I think or a year ago uh

they had 14 locations so it was a chain

of brick and mortar and since then we've

gone from 14 to 32 locations and the

reason we're able to do that is because

we focused on the sales process and

through a process that I want to walk

you through something that I call the

diagnostic sale we're able to 10x the

recurring revenue of the business across

all the locations so before we get into

the nitty-gritty of the story let me

just walk you through the steps in the

diagnostic process first is we like to

have some sort of pre-sale questionnaire

which the purpose of that is to get more

information that arms the salesperson so

they know who they're talking to what

their pains are but from the sales

perspective for them they also increase

their awareness of the problem second is

we get their information in their credit

card which is key and I'll explain why

it lat

uh third is we want to understand what

the current situation is where are you

at today then we have your desired state

so where would you like to be at and

then what's the obstacle why aren't you

there and then finally once we have

these big three we present the desired

State and our vehicle to overcome the

obstacle and we tie our price to the way

that we're going to get them there and

then finally we give them an incentive

to prepay so here's the five steps that

we follow to actually get this done so

number one is that we secret

shopped the business so we actually

looked into it we went there by the the

way you should secret shop your own

business highly recommend doing it

you'll be horrified by what you hear

your sales guys say you're like I

thought we had a script what are you

even doing number two is from there this

is basically information gathering we

figure out what the constraint is okay

where do we think there's big

opportunities in the business now you

should think about yourself as your own

business consultant if you could buy

your business today and look at your

business what would be the no duh thing

that you would do now for this

particular business we thought that they

had an offer constraint which really

came down to packaging we had offer SL

packaging because fundamentally we're

not going to change the core of the

business we're not going to all of a

sudden start selling soap when you sell

HVAC like that's not going to happen

right so the core of the business can

remain unchanged it's how we're going to

package the services we deliver or that

the services we sell to a customer how

are we going to get them to perceive

what we're selling we gathered the data

we figured out the constraint was that

they should get way more re bookings

which I thought was an offer and

packaging issue which is we need to sell

the solution sell the goal and so number

four is okay if we assume that we're

going to make this new transition into

this new new offer new packaging we have

to anticipate so you we call it killing

zombies uh which is one way of putting

it you anticipate the obstacles or

objections that people are going to

throw at you ahead of time write this in

neon marker above your sales team which

is it's way harder to get someone to buy

after you presented the price because

now they're like he's trying to sell me

so we have to counter that before we

become salesp people in their mind we

are a trusted expert ideally if we're

positioned well and you should be that

way if you know what you're talking

about and I like to use the frame of

childlike curiosity I always tilt my

head I probably even did it

subconsciously just now you tilt your

head when you ask the question because

it's non-threatening you're like huh

that's weird what changed between then

and now just so I understand then they

can tell you rather than be like you

said that your husband says he supports

you you can't say that now you have to

buy doesn't work that way if you win the

argument in a sale you lose the sale the

only way that you win the sale is being

willing to lose being right and so the

fifth step and this is the ongoing step

is that you implement the diagnostic

sales process so it's implementation so

now that I just outlined the five steps

let me deep dive into the implementation

into the actual business and how we did

this with this particular business when

we bought them I spent four hours with

our director of sales and we outlined

the new sales process we wanted to

implement and as soon as we implemented

that sales process we 4X LTV progresser

meaning how much people paid us it went

from 200 to 800 so really big jump and

we the crazy thing about this is that we

didn't change what we delivered we only

changed how we presented it and so this

is the key of how we create value how we

scale companies how we grow companies

and many companies keep these things as

Secrets uh as their special sauce and I

just fundamentally believe that the more

we put out the more we get back and say

that's why I operate this way all right

so I will hold nothing back and this is

something I call the diagnostic sales

process now to be very clear the

diagnostic sales process is one of two

two different sales or maybe three

different sales processes big picture

that you can have in a business one is a

transactional sale all the way on this

extreme so on one side you've got

transactional

sales and on this side you've got

Enterprise sales which is like uh

relational sales like if you think about

like you're selling some big Fortune 500

company you have to get stakeholders

involved get budget approval there's all

that stuff and on transactional side

you've got like High Velocity sales

we're talking 20 30 minute sales a guy

who stands in of the car wash sells Car

Wash somebody sells gym memberships

transactional and then you've kind of

got like this Middle where you might

sell something that's a little bit

higher ticket but it's a little bit more

custom all right now what we did was I

took their sale from here a purely

transactional sale and moved it towards

custom all right now in a transactional

sale you typically fit the customer to

the product and so let's say that I sell

Pence all right so I sell Pence if

somebody comes in I'm going to basically

spend all my effort listening to what

they say they want and then telling them

how this pen fits their needs or I have

to basically say your needs are wrong

let me educate you more and this

actually solves all your problems right

and so those are pretty much the only

two approaches you can take in a

transactional sale now the advantages of

having this type of sale is that it's

really fast uh they tend to be lower

ticket in general uh and from an

operational perspective in the business

you don't need to personalize anything

and so you get the sales team and the

Sal sales process to basically Orient

everyone like a funnel down to one

solution and then you just make a ton of

these Solutions and you get lots of

efficiencies because you only have to

produce one thing this the custom sale

is a harder sale sorry easier sale to do

but harder on the operational side and

so the magic happens when you can

actually Bridge the product component of

transactional which you say okay we only

sell these types of widgets this is the

only thing we deliver

but I can do it in a way that feels

custom feels personalized all right so

I'm going to give you two examples and

I'll explain this one in a second this

chart that I have here which if you

could take your recurring revenue from

that to that just by changing how you

sell if you'd want to do that hang tight

we're going to break that in the process

so if I had because I did this in the

gym in the gym world too which is part

of why our gyms make more money so a

traditional sale would look something

like this someone comes in so this is

traditional and you say we have a

membership that's you know whatever $99

per month all right that's your

membership and you say our membership

has this this this and this and you want

that right because it's going to help

you accomplish all your dreams okay

sometimes you get people sometimes you

don't what I

do we do something called a

diagnostic and so the first thing is

that when the person walks in the door

we get them to fill out a pre-sale

questionnaire and so that's like an

application in a digital process but an

inperson process it follows the same

logic which by the way internet

businesses follow local businesses local

businesses can also model internet

businesses when you find out something

works in one place which I think has

been one of the big advantages of I've

had in business is I try and put it in a

completely different place and it often

works too if you understand the concept

and so we fill out a pre-sale

questionnaire now the pre-sale

questionnaire simply walks them through

all the reasons they walked in today and

it ask them the same question in

multiple different ways so it's like hey

like what brought you in today what's

the current problem you're doing dealing

with how long You' been dealing with it

if you had to quantify how much this has

cost you financially what would it be uh

if it continued for five years how much

worse would the situation be and so the

whole point is we're trying to agitate

tame we're trying to bring attention to

this problem and Elevate its importance

so that's what the pre-sale

questionnaire does now the second thing

is we get info and this is very key so

when someone comes in after that we say

hey I want to I want to set up your

account profile and so when you do that

you collect their information and this

is the key part you get their credit

card now you're like wait a second I'm

getting a credit card but I haven't sold

anything exactly and you do that so that

when you do sell something later you

don't have to ask for it now you get the

pre-sale they're like wow I really do

need this thing you say hey let me

complete your customer profile just

standard procedure no big deal all right

then you get their info now if they're

like well I don't want to give you my

credit card you're just like it's just

how the system works it's how we

complete

profiles and then they'll give it to you

all right so from there this is the this

is where the special the special magic

that's unique to each individual

business happens so in the weight loss

business I want to understand where

their goal at so you say what's

current and then four what's

desired where are you now where would

you like to be and then this one you ask

them say what's the

obstacle what's in between these two

things is the obstacle right current

I've got an obstacle getting the way of

I desired that's all we're asking in the

process now in weight loss and in most

businesses the thing the person thinks

is in the way is often not the real

thing in the way and that's because

they've never had this conversation

before they clearly haven't solved the

solution and that's why they're coming

to you and so you want to just get their

words more so so that you can explain it

back to them using the language they

gave you all right and so in the weight

loss world for example instead of

selling a membership I would say okay

well it sounds like you need these three

things Fitness Nutrition accountability

Fitness wise you need to work out X days

a week nutrition wise you need to eat

this food at this time and we can help

you meal prep the stuff so you got when

you go to restaurants you can still

stick on it and you need accountability

because if you don't if you do if if I

give you the best fitness plan and the

best nutrition plan but you don't show

up doesn't matter right accountability

is what makes the whole thing work great

finished nutrition accountability easy

three-step framework fantastic now this

is where it becomes diagnostic now most

customers and this is why this is where

the magic happens is

that even if you still deliver the same

thing so fundamentally when I switch the

sales process the gyms remain the same

they still have workouts they still have

nutrition help they still have

accountability nothing changed but how

we present it changes and so rather than

saying hey I'm going to sell a four-week

thing or a six week thing I say hey

you're

currently 200 lb Okay now what's your

high school weight she says I want to I

want to get to 140 you say okay cool you

want to get to 140 this is your desired

okay so we have a 60 pound difference

now what we found is that we don't want

people to lose more than pound and a

half to two pounds a week all right so

let's just be conservative and call it

one and a half so then I take out my

calculator and I say what's 1 and a half

time 60 which would be other way around

it' be 60 divid by one and a half which

is 45 okay so 45 weeks is how

long it's going to take us to take you

from 200 to 140 so you lose a pound and

a half a week it's going to take 4 5

weeks and so

six present

price in

relation to

goal so you say awesome so we currently

charge 99 bucks a week we can get you

there in 45 weeks which means it's

$4,500 and that means and for us I added

a a guarantee on the back end which

which said hey if you show up to the

workouts for next 45 weeks and you log

your food and you don't lose the weight

I'll keep working with you for free

until you do

so that means this is the translation

this is the key part in the script so

that means when you pay this $4,500 it

means that you can count that weight for

good you can put it out of your mind you

pay me this money we're going to get

there one way or another As Long as You

Follow the steps you're G to follow the

steps right great and so here you're

trying to sell 99 bucks a month or or

whatever this would be 99 bucks a week

if if I was doing equivalent pricing all

right so this would be like a

semi-private

program but by positioning it this way

I'm not selling a membership anymore I'm

selling exactly what they want and

putting a price tag on it and saying you

want to get to 140 it's going to take

this long and I'll guarantee that you

that you'll get there provided you

follow these

steps and then they say wow that's

awesome you say well if you

want I can save you a little bit of

money you want to save a little bit of

money and they're like yeah I want to

save a little bit of money well if you

prepay you can save 10%

today so I can save you 450 bucks you

want to do that that's what most people

do

great you want to you want to use the

card you have in

file done so that's that's the process

now I took this process and applied it

to a completely different service

business that we own that's a chain that

this is a little bit more Medical but

the concept still applied which is and

this is the key part is you have to

figure out for whatever it is that you

sell what the current is versus what the

desired is so if I were

uh a painter all right and I was

painting houses sounds crazy right say

hey so you currently have this thing you

want a completely painted house and so

the like now for them this is like more

us do it for you rather than uh

self-service like I'm going to have to

like they you're not painting your house

and them helping you so they're actually

going to paint the house so then we just

try and think how can we how can we how

can we sell to goal and break it into a

price that we tie to that

and so it' be like okay so we're going

to need four coats of paint and it's

going to take this period of time and

then at that point your your whole house

is going to be weatherproofed and so

that means that when you pay this price

that's what you're going to get by this

date and if we don't get it done by that

date I'm going to give you

this and that way we can relieve their

risk that it's not going to happen and

we tie the purchase to the outcome so

this particular business when I bought

it or bought into it

um it was a business that they had

really good lead gen and they have a

good product but they didn't have good

packaging and I saw the opportunity

because I knew that if I installed my

sales process into their business I

could make it make a lot more money and

so if you have the opportunity to like

Forex a business without opening new

locations you do that and so that's more

or less what we did so I actually wrote

down the new sales process took me four

hours so I wrote down the new sales

process and then I presented to the

management team and they were like wow

this is the most valuable thing we've

ever had happen to our business and I

said great so let me know when you do it

across all the locations and let's keep

buying and opening new ones and so 18

months later we have 32 locations and

the recurring Revenue in that time

period has gone up and the average

revenue per customer went from

$200 to

$800 from this one process and that was

because before this they were selling

oneoff transactions they were saying hey

we'll do this service for you so think

of it like botox or we're going to do

filler or we're going to do something

this one time and so rather than just

say sure give us a call when you want it

again which is pretty much what the

process was before this I say hey you

want to look a certain way you're not

here because you want filler you're here

because you want to look a certain way

so if I show this chart to you of faces

and filler

densities where where do you see

yourself on here currently now you let

them self identify you can't be like

look Pi you're ugly you can't say that

so you got to say where are you on this

chart and then they say this now in the

weight loss sale I got them to step on

the scale the scale called you fat not

me all right so maybe just point to the

third party not me so so so you get them

to pick how ugly they are all right and

then you say how pretty do you want to

be now everyone's going to say I want to

be super pretty but here's the beautiful

thing when they pick how pretty they

want to be they're the one who set the

goal and that means that the price came

from them and you know where I picked

this up was yogurt stores so one of the

things I thought was genius about like

Yogurt Land and things like that was if

if you go to a store and then they fill

up your stuff behind the counter and

then they say hey it's 8 bucks you're

like man what the hell this place is so

expensive but if they give you the cup

and you fill it up and you put it on the

scale you're like man I'm a fat ass same

pricing but because I had control over

what I picked I'm the one who's

responsible for the decision and so by

saying where are you on this chart and

again this is where the magic happens I

say current desired that's where the

thinking behind how I'm going to

structure a sale is where like that's

where the that's where the experience

that's where the expertise that's where

it comes in this is the process and

hopefully you guys can take this for

your business and think like okay what's

current what do they really want they're

not buying lip filler they're not buying

a painted house they're buying an image

in their mind of what they want that

house to signify or what it means to

them and this lady is not buying filler

she's trying to buy a certain look she

wants people to think about her a

certain way she want when people walk

when she walks in the room she wants

guys to turn their heads though because

she's probably getting a little older

they're not turning their heads as much

and she still misses that and she' pay

anything to get that so say you're ugly

now how pretty do you want to be we say

cool so for us to get you from here to

here it's going to take us 45 weeks it's

going to take us Botox filler and you

know plastic surgery whatever we're

going have to hit you with a pretty

shovel and bring you back to life all

right we're going to have to do this and

it's going to take this many weeks for

us to reverse this level of Aging or at

least take these Crow feed out or

whatever it is and so we tie where

you're at to where you want to go and

then our solution is only the vehicle

that delivers this outcome and so that

is the moment that you present the price

because they picked where they were

where they want to go and then you as

the expert explain the path to getting

there so they picked the before and

after and you just use your expertise of

this is what we found best to get people

to hear Who start where you're at and so

we found out that this opportunity

existed within this particular business

because I had my sales director secret

shop them so mind you this is Brick and

mor chain we have a lot of locations so

we could sneak our way in it's harder if

you have like a you know four sales guys

who do all the sales they'll just tell

the owner right so we wanted a secret

shop before we actually completed the

investment and so uh when he went in he

was I I asked him so I went through this

checklist I was like okay so did they

give you some sort of pre-sale question

he was like no I was like okay great I

like did you did they ask you for your

credit card or did they ask you for your

information or anything before you got

the service and he was like No And I was

like fantastic what else what else did

they do it's like did they have you set

you know pick uh where you're at and

where what your goal is he said yeah

they did have me uh pick where I was at

but not where I wanted to go so they

just had him pick okay how ugly are you

and he was like okay now again not

completely flawed I want to be really

clear here like this is a at 14

locations they're not they're not idiots

they had the pain we agitated the pain

they said listen this is how ugly you

are on this scale that we invented and

you're here you're a seven ugly great so

he checked this but he didn't get to say

where he wanted to be so then from there

he just went right into the service and

then when he came out he just gave them

the card to pay for the service and that

was it and he just walked out the door

and I was like wait so they didn't they

didn't actually like ask you to buy a

package or get into some membership or

anything and he was like well they tried

to upsell me this one product at one

point but this was the price point and

the price point was like 20 bucks or

something and I knew what the average

customer is worth which was like 200 at

the time I was like this like by the way

if you're going to do upsells you want

the price point to usually be usually be

five times more than the current price

because if you get 20% of people so

customers are fractal so we're going to

go into a little side quest here but

it'll be worth it for you since we're

talking about sales

so you've heard of 8020 right so you've

got 100 people right the top 20% you've

got the 80 underneath

right these are the people 8020 have

five times the spending power of these

people and so because of that if you get

20% of people to buy something that's

five times as expensive so let's say my

current thing is

$1,000 if I'm going to have an upsell I

want my upsell to be

$5,000 because if 20% take it then it's

20% time 5,000 which means I add $11,000

to my average ticket so I go from $2,000

or sorry $1,000 per customer to

$2,000 per

customer and so when I heard that their

upsell was 10% it'd be like having it'

be like my upsell is 100 bucks okay fine

maybe 20% take that so I I go from a

th000 to

1,20 who cares like what's like why

bother right and fundamentally again

smart business owners and they were

upselling product which means there's no

real delivery in a brick and Mort

service business so they could just hand

the product make the money and I think

they were using it more for commissions

for their staff to increase the average

pay which a different objective entirely

and totally fine but I was only looking

at this from how do I take customers who

are worth $200 and make them my goal is

to get them worth a th000 currently it's

$800 I'm GNA keep getting there until we

get to a th but I think that we can get

it to a th and

so we secret shop them number

one which by the way if you have a team

of people who are currently selling your

stuff secret shop them and then be

horrified by what you listen to on the

phone or what you see in person because

you have this beautiful idea of what you

think your sales process is and it's a

nightmare it's an absolute nightmare if

they remember half of it you'll be

stoked and so if you run an environment

especially in a in a lower wage

environment so if you're brick and

mortar you have a chain of of locations

and you have to take low skill labor and

teach them a sales process you've like

the the expertise in sales comes down to

how easy and simple you can make the

process and so that comes down to like

can I automate parts of the p uh the

point of sale so that they can't move

forward without doing this checkbox

right and by doing this chalk boox they

have to ask the question so it forces

script adherence now training sales not

into this video but you want to

basically repeat the process over and

over and over again until they're sick

of it until they say like yes Mom would

you like to have do you have your credit

you want to use the credit card on on

file like until they're saying it like

they can they can breathe it they can

think they can say without thinking

about it that's when you've maybe just

started to have a te a team that's

that's well trained now that we finished

these seven uh pieces of the diagnostic

I want to add one more bonus because

you're like wait a second so where's the

where's the recurring Revenue great

observation Andrew okay so so number

eight is transition to recurring all

right I remember this I'll give you two

separate stories that'll drive this home

so A friend of mine has uh a a recurring

membership that he sells and he sells it

at uh I think he sell at 300 bucks a

month and he couldn't get people stick

past three months and so he tried all

these different gimmicks and things and

he just couldn't crack three months of

LTV now that could have been a pricing

issue whatever so this is what he did he

stopped selling it at $300 a month month

to month and started selling as a

$110,000 program with 36 month of

Interest

refinancing and so when people bought

they were buying a $10,000 price point

but they got an amazing aming payment

plan and so he didn't change anything

about what he sold but that took his

average customer from 3 months to 8

months so we're talking about a $900 so

3 * 300 to 8 * 300 2400 that kind of

change in a business life-changing in

terms of how much money you can make the

second one was I had a different friend

who had a continuity program uh he was

an uh agency and what he did was he

realized he had turn in his business and

so he said you know people are way less

likely to turn out of a payment plan

same as is the other one then they are

out of a monthly recurring Revenue

stream and so what you call it to the

customer can affect the likelihood that

they pay but as far as the business is

concerned you just want payments that

are regular and all you do to take a

program and take it from Rec from a

payment plan to recurring in terms of

how it actually looks and feels is you

just put an automatic recurring at the

end of the program and so when someone

buys this big thing and you make a

payment plan and then it recurs into the

exact same price as the payment plan you

just move the pieces around but the

likely they stick is way higher and so

that's exactly what we did as the last

step in the diagnostic sales process and

I wanted to highlight this point for you

because I've done it in every business

and so we give someone the option to

prepay you can give if you want a little

bit more aggressive you get 20% off if

they prepaid today if you want to have

one step down below that which is what I

like to do you give them 10% off if they

do half down and they make the rest as

payments and if they still can't do that

then I take the whole thing and I spread

it over let's say 45 weeks and so I'd

say okay it's 99 bucks a week 99 a week

and there you go now they go from 99 a

week to 80 bucks a week if they prepay

the whole thing and they go from 99

bucks a week to 90 a week if they prepay

half and here's the key part is that

when we present the price you present it

at the highest rate so you present it at

the payment plan let me walk I'll walk

you through this because I think it's

important well I'm going to put it here

and so I don't have to flip screens for

you all right so you have your full boat

I'll say full interest

price so for us in our example is 4500

bucks all right 45 weeks times 99

roughly all right so this is our full

boat price we have our prepayment

discount in full which is minus

20% all right so for us it's going to be

minus what is that 900 yeah 900 from

there so that's 5600 sorry other way uh

3600

3600 if they do half

down you say I I'll let you save uh 450

bucks so 10% so 4050 Z all right so this

is

10% minus 10% that's- 20% now the reason

this is so important is think about the

alternative think about and this is what

most people do so listen to me Andrew

most people do this they present the

price as

$3600 and then they say oh well we have

payment plans that we have interest on

and so we do we do have 10% interest if

you can put half down and we have 20%

interest if you put uh nothing down and

you just go onto a straight payment plan

well which one would you rather buy if

on one hand you have a $4,500 price tank

which anchors you high and you say or

you can get a benefit for prepaying

today rather than you think about 3600

you're considering it and then they say

oh it's even more even though you're

just considering this tag guess what you

have to pay way more now be because you

can't afford it you have to pay more

Banks do it all the time and guess what

everyone hates Banks so if banks want to

fix their process Mr Bank maybe this

will work who knows anyway point is is

that this is how you present the price

because you get the benefit of a price

anchor and you get to be the good guy

for getting them to pay upfront rather

than the bad guy for them not being able

to so we're going to we're going to go

through step eight in uh in the more

transition uh process for the sale and

so I want to just walk you through step

downs and so this is super important to

understand from a sales perspective so

we'll call this sales

step downs and uh this is by the way a

preview for my next book coming out $100

million yeah anyways so so Sal step

Downs is one of the things that we have

so obviously the first thing we're going

to present is a prepayment all right

which is pay in full today prepaid y by

the way you've probably noticed from any

of my content I don't say paidon fools

and that's because that's a that's a

Salesman term not a customer benefit if

you prepay you get a benefit whereas Pon

full is like I got all the cash to front

good for me

and so I have trained myself because I

used to say pton fools piff skis P you

know whatevers pifs like all of that

stuff I used to do as a sales team sales

leader and then I also heard my team

saying that to customers be like hey if

you want to pay in full today like it's

just like kind of gross and so I prefer

to say like hey we have a prepayment

discount and so training that just

little Pro tip for you so number one is

prepay number two is we do

discount uh with

partial so this is this is the half down

oops half

down here you can also do in-house well

this is whatever sorry this is credit

card or third

party so if you have like most most

businesses that sell legitimate Services

have third-party financing solutions

that already exist and so I promise you

there is a banker somewhere who started

a business to service this Emerging

Market of whatever it is that you do who

says I'll bet you I can help Finance

transactions now the prices they charge

for that financing will differ based on

how risky your business is and so like

there's financing for casinos like if

you want to get if you want to get a

loan to go gamble more like there's

financing for that but they will charge

you a lot of money right and so like

that being the extreme on the other hand

if you want to finance a house there's

obviously a huge mortgage industry and

so from every step in between there are

Partners who will step in as third party

and take on that risk for you for a

price and so I prefer can I get the

prepayment because it's easiest and

fastest if not usually have a third

party that I set up so that my customers

can get financing if we don't move past

either of these two things then I try to

go with a partial with some level of

discount not as much as here but a

little bit and if they still say

no then I go for

continuity which is why don't we just

make a payment plan on the thing and in

this particular business because what

they were doing before was simply

rebooking people for another session of

service we just had this be the

automatic like everyone gets rebooked

and that would became that became an

internal saying like I like having

mantras uh within sales teams which is

like everyone buys something like

everyone buy something there's no reason

someone should not buy something and so

sure we'll get them a prepay maybe a

partial okay fine we'll do a payment

plan that's whatever call it you know

250 uh times four great that's our $

th000 that's our th000 plan that we're

getting people to buy and you pay 250

today and then three more times and you

can do it every other month if it's a

more uh intermittent service whatever

just match the payments to when they get

delivery and then finally if they're

like well I can't do any of those things

it's like cool let's just let's just

book the next time you want to come in

that's it and so this is the final of

the process in terms of in terms of the

step Downs that we might offer someone

we just walk through this whole process

and you're like wow maybe that's a lot

of work I have to use my brain power but

welcome to business but let me tell you

why it's worth it so these are the

actual stats and I put the numbers

without the names to keep it nice open

loop for you so number one is that they

had 9% of Revenue uh that was recurring

within this product line all right so

they had 9% that was curring after we

implemented this

process

60% they took this 9% to 60% of this

product line within the company so

awesome number two they had basically no

membership at all because they just

weren't it wasn't even an option not

really and we were to push that to 30

that's a 30

30% into memberships this included

payment plans this is just

memberships and then we went from

getting one additional extra visit on

average per person meaning two to

getting four to

six visits per customer by introducing

this sales process and from a money

perspective we went from $220,000 when

we uh bought the business so mind you

this business made a lot more money than

this single product line or this service

line but this is where I want wanted to

invest my time because I thought there

was a huge opportunity here because I

saw from the secret shoer from the

constraints I thought this was a big

area of attack and so they're only

20,000 a month which business the size

is not a lot and then however many

however we dots this later over

250,000 per month in

added and it continues to grow and this

compounds and that's the that's the

beauty of this type of sales process and

repackaging of what someone already

sells and so we went from 9 to 60 0 to

30% on memberships from one visit to

four to six visits and from 20 to

250,000 so we more than 10x the

recurring revenue of this business by

following a diagnostic process rather

than just selling some traditional

one-off thing I have two books on Amazon

$100 million offers $100 million leads

you can go check them out uh if you have

are completely poor uh my podcast has

them for free too you can check those

out it's all free enjoy