When is Net New Business Not Net New Business?

whenI get it, we all need to drive net new business. We can’t survive by continually upgrading our base. Personally, I do a pretty good job with acquiring net new business.  A quick glance at my CRM will show that roughly 60 percent of follow ups and cold calls are for net new accounts.

Many dealerships will offer incentives to their sales reps to garner net new business. Thus, those dealerships are willing to give away a piece of the pie to grow their revenue stream. Good for the client, good for the dealership, and good for the sales person. Everybody wins, right?

What Defines Net New Business?

All dealers will agree that net new business is an account that you have no play in—you’ve never sold them a thing.  Not only is it net new business, it’s a net new account. Woo hoo!

Another caveat that may or may not be considered for net new business is that the account can qualify if your dealership has not done any business with them within a certain time frame. They got away from you years ago and you were able knock out the incumbent and win them back. Your relationship with the client stood the test of time. Knocking out the incumbent with your devices generates additional revenue for the dealership.

If you knock out a competitor’s piece of equipment and place your new equipment that’s net new business, right?

It seems that it’s not that easy. Let’s assume you have an account that has 10 imaging devices. You own half of the devices and the competitors own the other half. You’ve worked the account for years and finally you knocked out the remaining five systems. Do the five new systems count as net new business?  That’s a bone of contention and differs from dealer to dealer. Some will say it counts others will not count that as net new business. I’m in the camp that will take the side of how is that not net new business? You knocked out the remaining five systems, captured additional clicks, and grew the business.

Let’s take another scenario, the customer got away from you many years ago, they upgraded one device with a competitor and still have one of your older systems.  After five years you have a chance to get the business back, however, you discover that 12 months ago they bought one toner cartridge for $49 from your dealership for the one old device. There are dealerships that will say “Nada, this account will not qualify as net new business because they bought that $49 toner cartridge from us ‘x’ amount of months ago.”

I don’t understand this either, what part of the new hardware sale ($15K) is not net new business when you knock out the incumbents device?

Next month, I’m thinking about buying a new car. Right now I have an older Eclipse. The dealership that I bought my car from is no longer in business. I’m going to go buy a buy a Ford from a local dealer. Last month I bought an air filter from them for my son’s car. Do you think that dealership will count my business as net new or not net new because I bought the air filter a few months ago?

Good selling!


Art Post
About the Author
Art Post is the founder of the Print4Pay Hotel and the Print4Pay Hotel MFP Solutions Blog.