The Entrepreneurs Advocate

Archive for April, 2009

“I enjoy Dave’s newsletter and this caught my eye” Chris

A group of prospects were meeting with a sales representative at a Colorado steakhouse, and all were complaining that their steaks were overcooked. When the waiter came and asked whether everything was okay, all the people who had just complained said “Sure, everything’s fine.” As the waiter walked away, one fellow said “I wouldn’t come back to this place again if they paid me.” How many times have you lied to a waiter or waitress and told them everything was okay, when in fact the service or meal wasn’t good? It’s easy to remember that there are two kinds of objections that customers have: (1) the ones they tell you, and (2) their real objections.

Ben was a loyal buyer from a warehouse distributor. One day something went wrong, and he stopped doing business with them. He went from being a customer back to being a prospect. When a new sales rep was assigned to call on Ben, he knew that getting the truth about what happened might be difficult. When he sat across from Ben in the office, he asked one simple question ”What will it take to win back your business?” He put Ben in a situation where he could be positive and actually share what the business needed to do to get back in his good graces. Instead of allowing Ben to criticize his company, the sales rep allowed Ben to help find a solution.

Great salespeople know it isn’t what happens to you, but how you respond to what happens to you that will make your prospecting efforts a success.

“Reprinted with permission from “Creative Sales + Management, Inc.”

I was talking to a friend at a Private Equity Group today who found out that a company they own a portion of is behind on federal withholding taxes. He does not know how big the problem is, but he his worried because as an officer and board member he might be PERSONALLY responsible (gulp).

How can investors, part owners, lenders (seller back note holders) and other affected parties stay informed and protect themselves from tax problems in companies that they are involved with? By using IRS Form 8821 (Tax Information Authorization).

Form 8821 can make sure you are notified of any notice (negative or otherwise) from the IRS. When I was in Asset Based Lending, form 8821 was always included in the loan documents to be executed by new clients. If as a seller you take back a note from the buyer make sure this form is executed. If you invest in or buy a percentage of a company you need to know.

Tax issues are usually a symptom of greater problems. This simple tool can act as an early warning system.