“There is much more opportunity than there are people to see it.” —
Thomas Edison
If there’s a better example of
capitalism than a yard sale, I haven’t seen it. These events reflect two
fundamental business truths. First, anything is worth what someone will pay.
Second, one person’s trash is another person’s treasure.
Yard sales are conducted in
every city and every neighborhood because they are popular. It is estimated
that over 60-million people go to a yard sale every year. That’s a lot of
people searching for diamonds in the rough.
I’m a yard sales junkie, but I
don’t buy much. I think a lot of people are lookers and not buyers. You read about people who find rare items at yard
sales; however, I find mostly old clothes, old tools, used dishes, and old
people.
It seems that about 80 percent
of the items are trash, not treasures.
Twenty percent have some value. This breakout is in line with the Pareto
80/20 principle that is popular with business. For example, 80 percent of a
company’s sales and profits are created by only 20 percent of its
customers. This 20 percent group is
valuable.
I doubt many yard sales shoppers
recognize Pareto’s principle, but business leaders can use the 80/20 principle
to identify and focus on the 20 percent of their customers that provide 80
percent of their sales. Focusing on the vital few pays big dividends.
I don’t remember my first yard
sale, but I have gone to a lot of them. I do remember six business principles
played out at these yard sales.
1. Products. Have products people want. Put products that are only trash
in a dumpster. Be careful what you see as trash because someone else may view
it as a treasure. P.T. Barnum said,
“There is a sucker born every minute.” Business leaders know, you can’t build a
successful business based on attracting “suckers.” You can’t sell bad stuff and
then expect good things to happen.
2. Pricing. The price of an
item is what someone is willing to pay. Publilius Syrus, a first century B.C.
Roman philosopher, remarked that “A thing is worth whatever the buyer will pay
for it.” Today, that pricing principle
remains true but with a qualifier— a thing is worth whatever the buyer will pay
for it, and the competition will
allow.
3. Advertising. Several good yard sale signs strategically placed
directing prospects to your address does wonders for improving traffic flow.
The same is true of a well-constructed sales presentation: A solid presentation
will have strategically placed benefits to direct the prospect toward action
steps and the close.
4. Product positioning. I notice the successful yard sale operators
display some of their interesting items at the entrance of their driveway to
act as a magnet to attract people.
Business leaders position their product/service, so they stand out above
and beyond the completion.
5. Timing. The best product
selection is early in the morning. But the early bird also pays the higher
price. The lowest prices come with reduced selection late in the day. From the
seller’s perspective, the best profit opportunity is early before the
“treasures” are gone. Astute salespeople learn from this “early/high”,
“late/low” phenomenon: call on the highest priority customers first and early. Save
your later, more unproductive time for the 80 percent who provide 20 percent of
your business. Get the “treasure” before going after the “trash.”
6. Interact with the people. Successful yard sale operators greet,
engage, and are helpful to shoppers. Successful business leaders don’t operate
from a desk; they engage employees, customers, and suppliers to discover what’s
on their mind.
If you don’t stop yard sales,
get outside your box and attend several this weekend. You may find a business
strategy treasure.
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