The Hidden Cost of Cold Calling

Frank Rumbauskas
 


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The majority of sales organizations today continue to mandate cold calling by their salespeople. They do this despite the fact that cold calling has the lowest return of all prospecting methods. Managers like to require cold calling because it is done at the salesperson's time and expense, not the company's. They believe that the ability to scrape up some business here and there, on the salesperson's time, is enough to justify the ongoing activity of cold calling.

What they fail to realize, however, is the dangerous hidden cost of cold calling.

I'm talking about the effect that cold calling has on salespeople. In my experiences in working with hundreds of companies, doing sales training, sales planning, and coaching individual salespeople, I've learned a few basic truths that are valid one hundred percent of the time. First of all, companies that require cold calling have the highest turnover of all sales organizations, upwards of seventy-five percent. Such high turnover is disastrous to a company's long-term profitability. Companies that run a solid marketing program and provide qualified leads to their sales forces have virtually no turnover.

In the world of salespeople, the number one reason why salespeople quit their jobs is the requirement to cold call. And, as you can guess, the number one reason why top producers choose to stay with their employers long-term is because those employers are providing qualified leads and therefore there is no need at all, let alone any requirement, to cold call.

I personally quit jobs because of the requirement to cold call. On the contrary, I stayed at one particular position for quite a long time and was very prosperous there because my manager was actually against cold calling and worked hard to make sure we always had a decent supply of incoming leads. Not surprisingly, we were the most rapidly expanding branch in the country during my tenure there.

Sales organizations that wish to attract and keep the desirable, most professional top producers out there need to start with the basics and implement a solid marketing plan that will generate a consistent supply of leads for the sales force. Anything else will lead to a lack of talent and high turnover on the sales staff. A requirement to cold call repels great talent and attracts inexperienced salespeople who won't bring in the big numbers every manager desires. A good marketing system, and the consistent stream of leads it generates, attracts and keeps top sales talent.

Frank Rumbauskas is the author of Cold Calling Is A Waste Of Time: Sales Success In The Information Age. He is the founder of FJR Advisors, LLC, which publishes training materials that educate salespeople on how to generate business without cold calling. For more information, please visit http://www.nevercoldcall.com

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