Visualize the ending of a great sales appointment. You asked the right questions, and made some excellent, hard-hitting points. As you’re wrapping up, your prospective customer escorts you to the lobby, and says, “I really like your company’s offering.” Then, just as you’re ready to head out the revolving door, he slips in a question – one that he knows you want to hear – “can you give us a proposal and price quote?”
Press pause.
You already said S-word – sure – didn’t you? I’ve done it. We’ve all done it. We dig ourselves in a little deeper by autonomically adding, “When do you need it?” Then off we go. We diligently prepare and send a proposal by the date promised, and not one moment later.
And then . . . silence. As one VP of sales told me, “if you send pricing to a customer without any strings attached to it, your proposal is naked!” Good metaphor. Not an ounce of leverage. Nada. Zip. Want to arm wrestle?
Here’s my advice: don’t do it. DON’T DO IT! Instead, think quid pro quo.
I’ll explain how.
Step #1. After getting the pricing request, don’t answer right away. Instead, imagine your boss, spouse, or significant other swiftly kicking your left shin, hard. You should wince, though not visibly. Maintain a pensive, thoughtful expression for a second or two.
Step #2. In sub-second time, ask and answer for yourself the following questions:
1. Is my time valuable?
2. Is my expertise worth something?
3. Have I earned the right to make a reciprocal request?
If any of the answers are no, skip Step #3 below, and send the proposal. I wish you well. But I’m not bullish on your chances for winning.
Step #3. You answered yes to all the questions in Step #2. Great! Now use this statement, or one similar: “I can put this together, but it will require time on my part, and I must get [department 1], [department 2], and [name of executive] involved. Can I count on you to organize a meeting with [name of prospect contact 1, contact 2, etc.] to discuss the proposal on [specific date]?
You have made a perfectly reasonable request. One that your prospect can accept. One that he should accept. If he doesn’t, his message is loud and clear: “I win. You lose.” Don’t rationalize it away by saying, “well, they’re just so busy this time of year.” If your prospect is sincere about considering your proposal, he or she will make time to meet with you—before the proposal is in hand. Otherwise, advance at your own peril. And don’t whine if you don’t hear back by next week, next month, or maybe, ever.
But, in your zeal to be responsive, agreeable, customer-centric, helpful or whatever, suppose you respond reflexively, as I have, with the s-word. It’s still not too late for quid pro quo leverage. When you have completed your proposal, send an e-mail similar to the following:
“Hi [prospect name]: I’ve completed the pricing and project proposal for [prospect company name]. If you give me a date and time you can discuss it, I’ll mark my calendar, and will reply with the proposal attached.”
If your prospect is serious, you’ll get the date. If he or she responds by asking, “can you just send the proposal?” call me, and I’ll step you through what to do next. I guarantee we won’t need a long conversation.
Requiring quid pro quo doesn’t mitigate every risk that your company’s proposal won’t be given a fair evaluation, but it sure improves the odds.
Hi Andy
In a previous life I was Interim Head of CRM for a major automotive bank. During that time I had several hundred ‘salesmen’ approach me in an attempt to sell me stuff. Over time I developed three tests that a salesman had to pass before I would ask for a proposal and quote.
Test 1: Do you understand the problems that keep me awake at night?
My big, hairy problems were fairly well known and all it took is some desk research and a bit of primary research to find out. Despite this low entry hurdle, approx 90% of the salesmen couldn’t be bothered to find out about me and my problems, as they were only there to sell their stuff. That approach might work for commodity consumables were standard quality at lowest price was key, but it didn’t for anything more complicated. These salesmen were shown the door very quickly with the advice that it is customers who buy staff, not salesmen that sell stuff. Most of them never returned to darken my door.
Test 2: Is your solution significantly better than those I already use?
I already worked with a wide range of partners that helped me get my daily business done more effectively. Each of them had taken a while to develop an effective working relationship with me; an investment that both of us had to willingly make. Unless a salesman’s solution was significantly better than those I already used, why would I invest time, energy and money in developing another working relationship? I wouldn’t; I would talk to one of my existing partners about the salesman’s incremental solution and ask them to develop something similar instead. Of the 10% of salesmen that survived Test 1, only about half of them had significantly better solutions that survived Test 2. The rest were politely shown the door with the recommendation that they need to be better than the incumbent competitors, not exactly the same. None returned.
Test 3: Can you pilot it quickly, cheaply and without disrupting daily business?
I was a busy Head of CRM running a large portfolio of campaigns, post-sale service and pilot projects, often with third-party dealer involvement. I couldn’t afford to disrupt daily business with unproven solutions without risking the ire of my Board. I worked with each of the remaining 5% to try to identify how we could pilot their solutions in a ‘safe-fail’ pilot to evaluate whether it was right for me. Rather surprisingly, about half of the remaining salesmen were not willing to pilot their solutions to show they worked, only being willing to sell them ‘as seen’ to me. In other words, they wanted me to to take on all the risk. No way! I spent some time working with one salesman to adjust his solution so that it could be piloted. You could see him squirming as the end of his sales quarter approached. Only reluctantly did he sign-up for a pilot and only after I had done all the work showing him how to structure it so that he could book the sale (good for him) yet only get paid in full on completion of the pilot (good for me).
It is a few years since I handed over my interim role to a new Head of CRM. Of the 5% of salesmen would passed the three tests all of them are still at work supporting the automotive bank.
How does this true story relate to your post?
I think it does so in three ways:
Firstly, salesmen have to recognise that the Customer is King! If they are only there to represent their company rather than act as a flexible bridge between it and the customer, they deserve to be firmly shown the door.
Secondly, the sales process is a platonic mating ritual between the salesman and the buyer. Other than for trivial product purchases, most buyers place as much emphasis on the quality of the working relationship as they do on the quality of the product itself. If the salesman isn’t willing to commit to a working relationship during the sales period there is no chance they will be there once the sale has been closed. These salesmen should be shown the door too.
Finally, all of the power ultimately lies with the buyer. If the salesman resorts to the kind of self-serving ‘tricks’ you describe and they don’t have a unique, winning solution the buyer absolutely must have, he should remind the salesman whose money is being spent and who controls the purse strings.
It really is as simple as that.
If you tried to use the strategy you describe with me you would have been escorted off the premises in short order. Caveat vendor!
Graham Hill
@grahamhill
Graham: thanks for taking the time to comment. I understood your perspective through most of your commentary, and got a chuckle out of your expression, ‘platonic mating ritual.’
But I don’t agree with your characterization of quid pro quo as ‘self-serving tricks.’ OK – I’ll concede ‘self-serving’ because there’s nothing wrong with that, but ‘tricks?’ No way.
It’s risk management, pure and simple. I will share that the thumbnail I provided in Step #3, while generic, only scratches the surface of what’s often done to configure and prepare a complex price quote.
Many of my clients are government contractors, and it’s not unusual for a vendor to invest over $1 million bidding on a major opportunity. The dollar amount is less important than the main point: proposal creation is a major expense for many organizations, and there are huge risks. In fact, for these companies, and for many others, the quid pro quo I’m advocating is actually formalized through a department with the monolithic title, Contracts.
In essence, before a price proposal or bid is prepared, Contract Administration examines the selling risks, and if the risk amount doesn’t comport with the company’s capacity for carrying it, or if the buying process lacks adequate transparency (also a risk condition), there’s a choice, no bid being one of them. No bid happens every day. Call it reverse buying, if you want.
I’ve been involved in countless procurements, and it would be unimaginable for an experienced vendor to invest in creating a proposal for a major project without stipulating reciprocal terms for the evaluation. It makes good business sense, and keeps people more honest (and less arrogant) on both sides of the transaction equation – regardless of whether you’re a government or commercial enterprise.
Customer is king – great idea. I agree. But that doesn’t mean a buyer is off the hook for responsible behavior. And smart buyers know that vendors with backbones are likelier to be there for the long haul.
Hi Andrew
Rereading your original post I don’t think it was about the kind of proposal and quote that would normally be covered by a complicated RFI/RFP process. It appeared to be more about the traditional singleton salesman with his foot in the door.
I stand by all of the points in my comment – including rejecting the use of follow-up ‘tricks’ by the seller – in the latter case. Except in the rare case when the salesman has something so amazing and so unique that the buyer just has to have it, (and I have only seen this once or twice in a 25 year consulting, interim and director career), most of the power is with the buyer and NOT with the salesman. And that is only right and proper. There are usually many salesmen competing for every buyer with a problem to solve or an opportunity to take advantage of. Salesmen must compete to win the right to sell their stuff. The sooner salesmen accept that, the quicker they will be able to play their allotted part in the platonic mating ritual. Believe me, if buyers like their stuff they will be the first one on the telephone organising the next steps. They have a business to run after all and need all the help they can get.
Having been both a buyer and (more often) a seller, my experiences as a buyer informed by experience much more than that as a seller. The three rules have guided me in many a tricky sales situation. They have taught me that selling isn’t about the me or my products, but about the buyer and their problem/opportunity. I had better know the buyer’s business almost as well as they do if I am to sell. They have taught me that I have to be much better, faster and cheaper than the competition too. That means continuously improving my products, services and processes to increase their efficiency and effectiveness. And they have taught me the importance of being able to run fast, agile, phased pilots to prove the value-in-use of what I am selling. Over the years I have developed a tried and tested piloting methodology that I now use in all my work. They have also taught me to be very wary of salesmen who promise you the earth, pressure you into signing and once you have done so, quickly melt away like so much mist in the morning sun, only to wheel-in a team of inexperienced juniors to do the piloting. If a salesman wants my business they have to be in it for the long haul. And that is exactly what I offer my customers too.
Of course, complicated proposals and quotes are somewhat different. Having written many complicated RFPs, responded to many of them and selected many a supplier over the years, I recognise that things are more structured, more formal and a little less unequal in RFP-land. But even there, it is the buyer (including their allies in procurement) that always has the last say. Unless of course, the seller decides to walk away from a bid or a contract. I have done that on occasion too.
The seller-buyer relations will almost invariably be an unequal one with the buyer having the upper hand. The buyer sets the process, the conditions under which it will be carried out and makes the final buying decision, irrespective of the size of the sale. Not the salesman. The buyer’s responsibilities are to shareholders, customers and existing partners, and not to salesmen. If you don’t like that, you can always swap to the buyer-side.
Graham Hill
@grahamhill