I recall one evening, when I was a teenager (a very long time ago) my Mum coming into my room as I was on my bed listening to music. “You not going out tonight with the lads?” she asked. “No” I replied, “they are out with their girlfriends”. Mum then left my room to get on with the sorts of things that Mums did but returned a little later and put her head around the door. “If you want to get a girlfriend too, chances are you need to get out there, I doubt if she’s going to be knocking on your door saying ‘There you are, I found you’ any point soon”.
The wonder of Mum’s is that they are invariably right. The problem teenagers have with Mums is that this is the case. But after a while, I did manage to “get out there” and did find a girlfriend. So this little story has a happy ending.
Wind forward 10-15 years or so. I am in my first sales job (having moved across from a technical support position) and my Boss comes into the office. He gives me a little smile as I am reading through my letters of the day (that’s what we did before email) and shuffling some papers. My boss walks over to me and looks under my desk. He says nothing and then wanders over to the cupboard, opens it and peers inside. He then goes to the other desk in the office and looks under that. Turning to me he asks “I can’t see them Trevor, where are you hiding them?” with a confused expression I ask ”Hiding what?” He gives me a very serious look “The customer’s Trevor, I can’t see them anywhere…” I start to formulate a response when it dawns on me the point he is making. I’d become a little too ‘office friendly’ in much the same way I was ‘bedroom friendly’ during my teenage years. By boss was making exactly the same point as my Mum had been. You have to be ‘out there’ in order to find, make and build new relationships.
So if you are reading this in your office on a Monday morning and your “to-do” list is keeping you there for most of the day (or week) ask yourself “Where are those new customers?”
During the sales training programs that I run, almost without exception, delegates have fears and concerns about handling price based questions. They often confuse this aspect of sales with negotiations. Covering price based issues – for me – is totally different to conducting a negotiation. It’s more akin to haggling and justifying your price. Negotiations is a far larger topic and takes into account every aspect of the sale, not just the price.
I often ask “What are the questions you fear being asked by the customer? ” to the group – so we can then work on an appropriate response for their product and market. Over the 12 years I have been running these sessions, here are the top 3 price questions and a generic response on how best to handle them.
1. Why is your offer more expensive?
The first thing to address here is “Are we comparing like with like?” Is there offer equivalent in every way to yours? The competition may be lacking in some aspect that results in a lower price such as longer delivery times, no guarantees, reduced specifications etc. Before getting into a price discussion make sure you are comparing apples with apples. Don’t be afraid to ask for a copy of the competitive quote or offer from the prospective customer to aid the comparison.
2. Can you bring the price down?
The quick response here is “Sure, I have some flexibility here. In return for something from you”. That ‘something’ could be exclusivity, volume commitment, a referral, a case study payment in advance or a testimonial for your website. The key point here is never to give something away – unless you can justify it by getting something else back. If the prospect is not flexible in any of these areas then why should you be flexible on price?
3. Your competition is cheaper – can you match their price?
If the prospect contacts you to ask the above the best response is to reply “Why are you contacting me if you have already found an equivalent product at a lower price?” If it were me I’d have already bought the thing, rather than phoning up a higher priced competitor and asking for a discount. Unless of course, they offered something that I wasn’t getting from the cheaper competitor. So ask some questions and dig around a little to find out where you are outscoring the competition. This will then help explain and justify the price difference.
Please note that in all of the above situations you never say “No, that’s the price” or “Take it or leave it” These statements leave little room for further discussion and don’t leave the door open. You should always be open to price flexibility but you need to show the customer that they need to do something in order to get a better deal.
You are new business looking for customers, or an established business looking for more customers. Either way you need more sales. Chances are you were alerted to this problem from looking at your cash-flow, order book or bank statement.
But to get more businesses you either have to invest some money, time or ideally both. Money you don’t have much off and spending it to get more business accelerates the financial problems if it doesn’t result in more sales. So as you see it in order to solve the problem you need to spend some money, and are very reluctant to do this without some level of guarantee of success. Chances are you look to marketing companies that will do the work to promote you – but at a cut rate price, or promise jam-tomorrow as if the marketing company is any good they will generate more business for you.
You have time though. But you are unlikely to have the skills to develop new business. That’s illustrated by the problem you have at the moment. Your existing customers are not buying as much, going elsewhere or are also feeling the pinch. So you look to find some agents or representatives that will work on a ‘commission only’ basis. Or you turn to the ‘phone book and “smile and dial” hoping to land a new account. Or you go networking and have a regular lunch / breakfast and try to find people who know the kind of customer you are after.
All the above tactics involve either passing on the risk of your business model to others, or take a long time to actually achieve results. Possibly time you don’t have.
How to avoid the above scenario? In response I want to quote a mantra that my first boss would always recite to me.
“When you get busy, don’t stop doing the things that got you busy”
I thought I understood what he meant at the time, but over the years these powerful words continue to resonate with me. Simply put: many people and organisations scale down their activity in generating business once they get busy doing the business. It’s only natural as ‘doing the business’ is often more fun and interesting than the hard, slow slog of getting the business. But that is a risky strategy, especially in a difficult economic climate.
So look back at what got you busy. What have you stopped doing as a result of being busy that got you busy in the first place? And if you’ve never been busy it’s time to develop those sales and networking skills.
Time to re-think the business plan?