Understanding procurement professionals is an important step in the sales cycle. I have heard the words “It is a done deal. It is in procurement” uttered by many salespeople of varied skill sets and levels. Getting a deal to procurement is not getting it done. There are many ways a contract can die on the desk of a procurement person, let’s look at a few.
If you have a product or service that can be provided by other companies you still have a lot of work to do in pushing that deal to close. The first and most often reason deals die in procurement is, your deal is not the only offer bieng considered. Your contract could be sitting next to offers of your competitors as the procurement professional dissects each contract line-by-line.
The procurement professional will look at each line item on the contracts weighing the value of each entry. If your company is offering free training or free support with a product or service add a dollar value to it. The training or support can then be balanced out later as a onetime promotion or discount. Free training or support could also be your final negotiating concession. Your competitor is probably charging for these services, this will further validate your cash assessment of these line items.
The second assumption many sales people make is thinking a procurement professional is a finance clerk rubber stamping contracts. This conjecture is o-so wrong. Most procurement professionals are sent to multiple sales trainings. In some cases procurement professionals get more negotiation training than most salespeople do. Trust me when I say procurement professionals have seen and heard every close you are going to hit them with.
Most procurement professionals receive promotions, bonuses and commissions based on the percentages they get sales people to slash their contracts by. With this in mind do not let you bottom-line deal get to procurement, leave yourself a little room on the final contract to negotiate. If you can help the procurement professional show they were able to get an additional 5 – 10% saved on the deal it becomes a win-win for all parties involved.
The bottom-line is just because the deal has left the end-user’s desk doesn’t mean it will get done. There are multiple places within legal and procurement a deal can die. My best advice is prepare for these contingencies and do not assume there is a rubber stamp anywhere in the process.
Knowing your prospect’s buying power or signing authority can seal deals and shorten sales cycles. I think back to a software deal I had on the table with a wireless cellular carrier years back. The invoice price for the total solution was $50,000. The deal dragged on for a few months until I got a call from the prospect at 2 P.M. the day before Christmas.
The prospect told me the since procurement was out of the office for Christmas Eve he could use his buying authority to sign off on anything under $25,000. He suggested if we broke the deal into two invoices for $24,900 we could get it done that day.
Not wasting any time I raced across New Hampshire back to my office, generated the paperwork and got the deal done. Making the day even sweeter, our company’s CEO came into the office to pick up Christmas gifts he had stashed in the office as $50K was pouring off of the fax machine. I learnt a valuable lesson that day.
I took this understanding of prospects’ buying authority with me throughout my career. When dealing with government agencies, healthcare and educational institutions I have noticed if you can keep the proposal below a certain threshold you avoid having the RFP from going out to bid. You could lose revenue in the bidding process or even worse the deal and account itself.
If you can keep a deal out of the bidding process or out of procurement do it at all costs. Less red tape means a shorter sales cycle, be creative when sending proposals to larger companies. Have the conversation with your prospects about their budgets and signing authority. Sometimes putting goods and services on separate invoices may get the deal done. You might even want to consider using a channel partner to handle part of the deal
Any sales professional will tell you researching target companies can be painful. It is beyond important to have great research on your prospects; the downside is research time takes away from valuable selling time. SalesQuest’s new product Mid-Market Manager or M3 is the type of tool that will give sales professionals a lot of that valuable time back. M3 is a very intuitive prospecting tool that takes the user beyond the traditional prospecting directories. M3 was able to give me a clear snapshot of the companies I was prospecting in a concise and intelligent manner.
Most company information in the Jigsaw-like sales tools is basic. These tools provide company name, address, URL, a stock ticker and a list of names to sort through. Now comes the painful part – digging through page after page on Google to match up this basic information with useable data. M3 is a time saver, delivering the user current revenue information and up to date org charts. There are links that will pull up any current news and information on the companies or executives of interest. Having all of this information in one interface will help any sales professional create informed and coherent account plans quickly and easily.
If you don’t know how to draw up a plan of attack for a major account SalesQuest has that covered also. SalesQuest is an industry leader of strategic company information for sales professionals. Their website has great whitepapers that show you not only how SalesQuest assembles this company data, but how to use it to start building plans of attacks for yourself.
M3 is also a valuable tool for executive search and sales recruiters. A recruiter can easily take a look an org chart to see major players in a company of interest. Sales and executive recruiters can pull up financials along with a list of candidates, matching company performance against an executive’s tenure.
The possibilities with this tool are endless; at first blush it looks like M3 is going to make prospecting a breeze. It is also nice to have good company research at my fingertips during that first call.
I watched Matt Damon’s new film Promised Land this weekend with little expectations. Damon is a talented actor and typically turns out a great product, what I wasn’t expecting was a valuable lesson in sales. Matt Damon plays a top real estate negotiator in the film. His sales skills are impeccable, his negotiating is ruthless. Where his character lacks in his arsenal of sales skills is simply put, character.
Promised Land is a story of sales integrity on par with Glengarry Glen Ross. I am not one to post spoilers so I will leave you to watch the film yourself. What I will say, as we learned in Glengarry Glen Ross, without integrity, honesty, and transparency a sale cycle and/or a sales career will be short lived.
I know a lot of great sales people that are amazing at building a strategic account plans. These leaders in their chosen profession create and map plans of attack detailed in every aspect of the sales process from the initial call to the close. What many sales people fail to do is analyze the sale once it is complete.
By analyzing our wins we can refine and tune our total process. This is not only good for the sales person but also beneficial to the customer.
Our prospect’s time is just as important as ours. By eliminating unnecessary steps in the sales process we deliver mission critical solutions to customers sooner, hopefully before our competitors do. In streamlining our strategic account plans we can also expect shorter sales cycles and more wins. Remember, time kills all sales.
My advice for the day is look at your top 3 wins, and dissect the process that helped you win the accounts. Once you have a clear understanding of how you won the deals… wash, rinse, reevaluate, and repeat.
It is not news to any commuter in the country that gas prices are beginning to soar. It is also know that the gas prices on the west coast are typically the high-water mark for prices nationwide. Due to these astronomical gas prices car dealerships in California are starting to charge for test drives.
Fox DC reported: In California before you get the keys for a test drive at some auto sales centers you must agree to bring it back with the same amount of gas you left with.
It seems like just yesterday when a dealership would pay the consumer to test-drive a car. Incentives including free dinners, sports tickets and even gift card were the norm. Dodge even had a cross-promotion with Universal where the test driver would get DVDs of the first four Fast and Furious movies and theater tickets to the Fast Five for taking the new Dodge Charger for a spin.
I am sure dealerships will soon be rethinking this policy. When you take into account the costs associated with getting one qualified buyer onto a showroom floor; I doubt a dealerships will let a hot lead walk for the price of a gallon of gas.
When you are starting a business, one of the first things to do is register the domain name. The staggering cost is about $7, not much to pay to secure your brand. A computer geek with a great sense of humor named Bryan Mytko noticed Guy Fieri’s American Kitchen & Bar did not take this simple step. Bryan took it upon himself to help out Guy Fieri and crew and got a menu up on the domain guysamericankitchenandbar.com for them.
This is the second hit Guy Fieri has taken on his new restaurant. The New York Times reviewed the reality star’s new endeavor and absolutely slammed the restaurant. Personally I think Bryan’s menu looks better than anything the New York Times described.
The Panamania sounds great for a mere $24.00. Being a huge VanHalen fan there is no way I could pass on the deep fried snake served with a sparkler and a picture of David Lee Roth.
I have been putting together my 5-year plan. My ultimate goal is to increase my gross sales 20% year over year. To do this certain disciplines must be in place. My first objective is to do at least one “educational” sales activity per day. Activities on my to-do list are reading a chapter from a sales book, doing an online webinar or attending a networking event.
Just got done reading Business Transformation: A New Path to Profit for the Printing Industry by John Foley Jr. It was difficult to put down. It was interesting reading about the changes in the print industry. I remember the days when printers would increase their portfolio of products by piling mail order catalogs for custom print pens and coffee cups on their counters. Evolving from print shops and mail houses to digital content providers and “email houses” is the natural transformation for this industry.
One stat in the book that jumped out at me was the DMA reporting direct mail marketing shrinking by 15.6% while Internet marketing only grew 1.1%. It makes me wonder where those marketers are now spending their budgets and the best way to get to them. Obviously, the best way is, simply ask them.
I found the book to be a concise guide for not only the print industry but also any person with the desire to take the leap to next-gen marketing. I loved the trade show story about the non-sale. In addition, it was great how John Foley Jr pointed the reader in the direction of solution selling without delving too deep into the subject.
I am hoping this blog will serve as a forum for sales people to discuss the art of the close.