Sales Laundry

Posts Tagged ‘Sales Tips’

Q&A’s are excerpts of questions I have answered as part of Sales Laundry or other forums that I am apart of. If there is a relevant sales message for the masses I post it here to share, gather feedback and discuss.

Q: What do you do when your client tells you that your proposal is twice the price of your nearest competitor?  My client just called me and told me that my quote was 2X more expensive than the highest bid received from other companies.  What do I do next?

A: First, don’t panic.

At least your client is talking to you.  They could have just as easily thrown your proposal in the trash and never contacted you.

This could just be a ploy by your client to get you to lower your price or it could be a legitimate question about why your price is so high.  Either way, your next move is to contact the client as soon as possible.

Your client is theoretically trying to make the best decision possible for their business and that is how you should approach this problem as well.  Be a resource to truly help them figure out the best course of action.

If your price is 2X your nearest competitor, either:

A.  You misunderstood the requirements.
B.  Everyone misunderstood the requirements except you.
C.  You are offering something of additional value that your competitors are not offering.
D.  You are priced too high for your market.

If you have a great relationship with your client, I would ask to meet with them and help them compare the competitors proposal to your own to make sure it is a fair comparison.

I would do the following:

1.  Review the specific issues that the client said was important to have addressed in the proposal.  If you can get the client to rank the issues in order of importance, that would be even better. (See point #8.)

Doing this exercise should tell you if you and your client are in agreement on what all of their issues are that should be addressed in the proposal and help you identify if the problem with your client is A, B or C above.

2.  If you have a unique service or offering that would be of value to your client that your competitor is not capable of matching, you can try to get that service included on the “important issues to address” list, though you should have done this the first time around.  I would just say make sure you keep your clients best interests in mind when making this decision.

3.  Once you are certain you and your client are in agreement on what issues need to be addressed in the proposal, ask to review the quotes.

4.  Compare your quote and the competitors quote to the ranked list of issues and point out the specific spots where the proposals differ from each other or the list.

5. If you have addressed issues in your proposal not on the list or that the client does not want it is up to you to offer to remove the item or convince the client that they need it and to pay the additional cost associated with it.

6. If your proposal has addressed everything on the list, but your competitors proposal has not, ask the client if the item the competitor left off is important.  If it is important, the competitor needs to add it, if it is not truly important, take that item off your proposal and adjust the price accordingly.

7.  If your competitor has offered a very low price to get the business that you do not think they can honor, explain your concern to the customer and offer a fixed price or a guarantee to meet the price you quoted to eliminate the advantage such a tactic might give your competitor.

8.  If the client did rank their issues in order of importance and price seems to be their ultimate concern, you might offer to remove the lowest ranking issues from the proposal and reduce your price accordingly.

9.  OPTION: Offer up a discount/rebate or refund if you are wrong.  You could offer to charge a lower rate if your actual costs are lower than what you are predicting in your proposal.

Good luck!

Early into my sales career I found myself working in a regional electronics and appliance store trying to figure out how to sell the stuff I was surrounded by but had ignored my whole life growing up, appliances.

The #1 reason I wanted to know how to sell appliances was not for the noble purpose of being a knowledgeable source of information for customers; it was for a far more selfish reason, I wanted to beat Davis.

Even on my first day as a trusty new representative, I could see Davis was not a man to be trusted. He had shifty eyes, a smirk like he knew something you didn’t, and a good decade of experience on the rest of us. Picture Snidely Whiplash without the top hat.

Davis was the number one sales rep my first month at the store. He was also number one each and every month he had ever worked there. He was a selling machine and was being paid stupid money compared to the rest of the sales team.

How could a guy that looked about as trustworthy as a snake in a cage full of furry mice continually outsell every other guy on the floor? Why didn’t the customers see right through that stupid grin?

Trying to figure it out, I asked each and every other rep what they thought his secret was before my first two months was at an end.

“He just lies and tells them stuff to get the sale.”

“He has been here so long he has repeat customers that wait for him.”

“He steals sales on your day off.”

“The owner throws extra special customers his way.”

“Customers just don’t understand what a shyster he is.”

“He has good product knowledge.”

And finally…

“He is just good.”

It seemed easy to believe the repeat customer part, or that he had built up a client base that would come back to see him, but that did not make sense if he was lying to every customer he sold to.

The only thing I could see as a tangible difference was his product knowledge, so I set about learning about every item in the store. Anytime a manufacturer’s rep would come in the store I would quiz him about every feature and benefit to every box in the building that we carried.

I studied owner’s manuals (this was long before the Internet) and product sales literature. I watched the TV commercials to see how they were pitching the products. I even went to other appliance stores to watch reps, ask questions, and in general try to be an information sponge.

Finally, after six months of careful painstaking study I knew the story and feature set behind every product in the building and I thought for certain the very next month would spell the end of Davis’ streak of consecutive months at being number one.

I beamed with pride the first day of the month because I crushed Davis’ totals. I sold $2000 worth of merchandise, Davis sold $359 worth. Of course, it was a hollow victory, as that had been Davis’ day off and his one sale was a customer coming back with his card to buy a TV.

Day two, though, I was ready. I had a two pronged attack planned. I had massive product knowledge and I was fast, so I could out run Davis to the customers. I was certain with knowledge and speed combined, Davis would be doomed.

Davis crushed me.

Day 3. Davis crushed me.

Day 4. I was off. Davis crushed me.

Day 5. I was working. Davis crushed me.

With few moments of triumph, which I had already accomplished a time or two before I set my new strategy in play, that is how the entire month played out.

Finally, I decided Davis must have access to product knowledge through his experience I just did not know, so I decided to ask him how to sell Maytag washing machines, because Davis sold them better than anybody and they were expensive compared to the other brands for the most part.

What Davis said that day changed my perception of sales every subsequent day for the rest of my sales life.

He said “When a customer likes the Maytag’s, I sell them a Maytag. When a customer likes the Kitchenaid, I sell them a Kitchenaid.”

Don’t worry; it took me a bit of thinking to unlock the brilliance of that statement as well, so I followed up his statement with a very succinct question.

“Huh?” David laughed at me, looking at me like I was a little boy playing a game for the grownups.

“When the customer likes the Maytag, I tell them about how the small agitator in the Maytag washer is easy on their cloths, because friction with the agitator makes the cloths wear out more quickly. Maytag moves the water through the cloths, not the clothes through the water. Plus they are easy to repair yourself with front access and pieces that are user serviceable.” He said. “When a customer likes the Kitchenaids, I explain how the large agitator in the washer does a fantastic job of churning the cloths and scrubbing them clean as Kitchenaids move the cloths through the water and there are no belts that need replacing like there are on the Maytag’s. Get it?”

“Yes.” I said. I lied. It took even more thinking that night to figure out what he just said then it hit me like, like, like a truckload of Maytag washing machines.

I realized I had done all the research; from Consumer Reports to vendor reps and manuals, etc. and I had decided, based on my expert opinion, which products were the best and those were the ones I tried to sell everyone. If they did not see the brilliance of my logic, I would continue to whack them over the head with facts demonstrating why I was smarter than them and why they should pick the product I was recommending.

As a result I only sold customers I could shoehorn into what I thought was best, and I was taking way too long with the ones that were not listening, meaning Davis was selling more and getting to more customers.

Davis would steal a sale or two on your day off if you would let him, but he never tried to swim upstream with a customer unnecessarily to get them to buy what he thought was best. To his credit, the one the customer bought was the best one because that was the one that got him paid, not the guy at the appliance store across the street.

If you are selling multiple brands of essentially the same basic product, try to understand what each individual brand of that product type is trying to hang their hat on, so to speak.

There will be products selling on no other value than being the lowest price in the category, there will be products that try to offer a unique feature or service that they will try to differentiate themselves with and there will be the top of the line, feature rich models.

Which one should you sell? All of them. Ask your qualifying questions and listen to the answers. Let their needs and wants drive what you sell, not some preconceived notion of what you think is best.

Listen then educate, never dictate or pontificate.

I love cheesy sales one liners.

Image courtesy of newsday.com

For your 3 minutes today I will show you one consistent way to come across a little smarter to your prospect in a meeting and how to put them a little more at ease.  Planning is part of the conversation, so with that I am kicking us off with one of my favorite quotes on the subject of planning.   

 “You know what I noticed? Nobody panics when things go according to plan–even if the plan is horrifying. If tomorrow I tell the press that a gang banger will get shot, or a truckload of soldiers will be blown up, nobody panics, because it’s all part of the plan.”

-          The Joker (Heath Ledger) “The Dark Knight” 2008

Everyone, prospects included, likes to know there is a plan.  Everyone is happier, still, when they know what the plan is.  It must be hard wired in our DNA somewhere.

 Plans are everywhere.  Go to church?  They give you a church bulletin that lists everything that is going to happen, and we feel better knowing.

 Getting the car repaired?  As soon as we give them the keys we want a plan.  We want to know what they are going to do to it and when it will be ready.

 Going in for Surgery?  It is not quite as frightening when the doctor tells us his plan.  The same is true for every aspect of life, right down to our economy.  When everything falls to pieces and chaos ensues we move to the brink of panic until there is a plan to rally around, no matter how miserable the plan is.

 Want to seem a little bit smarter on your next account call?  Pre-plan the sales call.

Want to look like an expert and put your prospect a little more at ease?  Pre-plan your sales call and explain the details of the plan to your prospect up front and get natural human nature working in your favor.

Example: 

“Hello, Mr. Jones.  It is great getting a chance to meet with you today.  I have done some research, but if you don’t mind, I would like to ask you a few questions to get a better understanding.  Is that alright?”

 “Sure.”

 “Great.  I’ve got five or six basic questions that will fill in some gaps for me and give me a better understanding of your company.  That should take us about 15 minutes, depending upon your answers.  After that we should spend about 20 minutes drilling down into some specifics and identify a few areas where we might be able to help one another, leaving the balance of our time to wrap up any loose ends.  Do you have any questions before we get started?”

 When I was taught this it was called the Predict and Prove Method or the Sandwich Technique.  The objective is to predict the basics of what will occur in the meeting, prove your prediction by executing the meeting properly, and then following up at the end to confirm the fulfilled prediction with your prospect.  End result?  You look smarter and your client is not wondering where or when your sales odyssey will end.

 Got it?

 Good.  See you Monday.

 “I love it when a plan comes together!”

– Col. John “Hannibal” Smith (George Peppard) “The A-Team” 1983

I got some great responses on both the article and the survey at the end of the “How to get Referrals & get Them to Work for You” article, so I decided to share one more story that should motivate you to get moving.  This story is particularly interesting because this story takes place in economic conditions like we are seeing today.

 Salesman Joe Girard is our main character.  Many of you may have heard of him, but for those that have not, listen up.

 Joe never finished high school and bounced around from job to job until he ended up in Michigan begging a Sales Manager of a Chevrolet car dealership for a sales job.  Joe got the job and sold his first car that day and borrowed $10 from his Sales Manager to buy groceries on his way home.  The dealership owner fired him two months later after having sold an amazing 18 cars because the other salesmen complained he was being too aggressive.

 Based on his new found success, Joe found employment at Merollis Chevrolet and began a legendary career that would put him in the Guinness Book of World records and earn himself a spot in the Automotive Hall of Fame in 2001.   He is the only sales representative in the Hall of Fame.

 Joe Girard, according to the Guinness Book, sold more new cars and trucks on a one-to-one basis (that is retail, to people like you and me, not wholesale or fleet cars) than any other sales representative in the world, and then repeated that feat 12 consecutive times.

 Over 15 years he sold 13,001 cars or roughly 17 cars every week for 750+ weeks.  In his best year he sold 1,425 cars, or between 5 and 6 cars a day, depending on how many days he worked a given week.

Here is the best part.

 In 1974, during a major recession, unemployment at 9% (today it is hovering around 8%,) oil was in short supply, gas being rationed, not sold, (see picture) the consensus was you could not sell cars.  Joe only sold 1,376 that year, or roughly 27 cars a week!

 How did Joe sell so many cars?

 As you might have guessed, primarily by referrals.  Long before email and the personal computer Joe sent a handwritten card to every single person on his list, every month, just to let people know he was still out there selling cars and thinking about them.  No promotions, no advertisements, just hand written cards.

 Joe referral system was so successful he personally hired two assistants to help him pre-screen his customers, manage his appointment-only sales schedule, and assist him in writing 500+ cards every day.

 One simple idea, staying in touch with people and letting them know you care about them executed by mailing each person one card a month put a sales representative named Joe in the Guinness Book of World Records as the best car salesman of all time.

 Imagine what Joe could do with the technology we have today.  Better yet, imagine what you can do, and then do it.  What one simple step can you take to start building a referral generation system for your business?  It does not have to be impressive, worst case just send a card.

 Let me know what you come up with.

•  Want to see what the stock market in 1974 looked like compared to 2008, see the graphs here.
• Learn more about the best car salesman in the world, Joe Girard.
• Cartoon image courtesy of http://www.automation.com
• Gas coupon image courtesy of Wikimedia

As a sales person you need to read “What does better mean?” It is a very short article by Seth Godin that will take you one minute at the most to learn a lesson it took me a long time to figure out.

 His message is aimed at marketing types, but the message hit me right between the eyes in its simplicity.

 Which is better Microsoft Office or Open Office?  Google or Live?  Firefox or Chrome?  Coke or Pepsi?  McDonalds or Burger King?  Best Buy or Circuit City?  Ok, winner declared on that last one.

 While you may be selling version 2.0 or version 10, just because Marketing, the CEO, you, your Sales Manager, your mother and the mailman all say it is better absolutely does not mean that it actually IS better to the one person that matters.  That would be the one making the purchase.

 So the next time you find yourself thinking  “How could they not see that our solution was OBVIOUSLY better?” you should have a better answer as to what went wrong than the one you have today.

 You thought you were selling something that was obviously better, you just did not make sure it was obviously better to the buyer.

In the battle of which is better, the buyers “better” always wins.

On almost every small to medium business web site I have ever looked at, when I read the “About” section, it almost always starts off with something like this.

 X Company, an industry leading…  or X Company is the world leader in X…

 How can everyone be leading their industry?  They can’t.

 Newsflash.  I don’t believe you when you say that and neither does your customer.

 Interestingly enough, the one place I do not typically see the “industry leading” moniker is on the web site of the company that actually is the industry leader.

 Why?  I assume because everyone in their market solar system of competitors, prospects, clients and vendors already knows this information and considers it a given.

 So, if you are number one, we most likely know it already.

 If you are not the best, or close to it, but you say you are, you can improve your message by just shutting up.

Your startup or 2 year old services company should not be blowing smoke about being the best or being an “industry leader.”

 Stop it.  You are destroying your own credibility.  If I can’t belive you on something that basic, how am I going to believe you in your area of expertise where my limited knowledge forces me to travel with you on trust?  

 I can’t.

 Muhammad Ali said “I am the greatest, I said that even before I knew I was.”

 The difference is he delivered proof of his personal branding message under the bright lights of a live event repeatedly on national television.

 Are you the best?  Should you be considered the best?  Don’t tell me how great you are.  Show me.  Give me evidence of your greatness from a source I will trust.

 One example of “evidence” not to follow would be the supposed professionals quoted on  DVD cases.

 “Best family movie of the year” – X Magazine.        

“A thrill ride from beginning to end!” – NY Times.

 No one believes the hype on the box, especially if it only lists the title of the reviewing publication.  Was there not one single guy working there that was willing to put his name to the review?  So what does it amount to?  A waste of time to write, an erosion credibility, and an abuse of the customers time spent reading it.

 Give me a video testimonial.  Give me a signed reference letter and a phone number that I can call to back it up.  Give me independent research.

 If you are not the industry leader, tell me what you are, and give me a compelling reason to forsake the safety of the industry leader to take a ride with you.

 One last point.  It has been consistently proven that people are by in large not trying to make the very best choice they can, they are trying to avoid making a bad choice.

 You don’t have to be the world wide number 1, you just have to be number 1 for me. 

You heard it here first, if Global Warming is real, the source is not cow butts or cars, it is the smoke spewing from the collective mouths of crusty reps and unimaginitive copy writers. 
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Over the years I’ve been through several reshufflings of product, service or target market.  Some of these changes have been revolutionary following industry changes, some evolutionary, and some have been flat out ground up rebuilds when management transitions or other fundamental changes to the business were at hand.

 I have watched these changes occur from the perspective of an Account Manager, Sales Manager, Director and finally, VP.  One thing that seems to get missed in the discussions of deepening the offerings, broadening the offerings, positive average margin impact, vendor training, leads, and promised revenues is the grey matter between the account managers ears.

 There is only so much space in anyone’s head.  You can only keep so much information at the forefront of your peanut head at anyone time.  If you thought about it like an old school newspaper or your favorite new site, there is only so much premium space above the fold (or before you start scrolling down.)

If you have anything north of 10 offerings for your rep to drive out in the field, you really only have 1-5 that he is going to be actively working and watching for and maybe 10 offerings in total that he has sufficient depth to discuss in some detail. 

 The “Closet Offerings” as I call them, or everything beyond 10, do not get mentioned unless prospect comments or questions happen to push the conversation in that general direction.

 When you get a call to broaden your offerings or to go after an increasingly wide and diverse market (typically when sales are slumping and revenues tighten up,) resist the urge to simply pile on more products and new markets to your existing team.

If it is not on the billboard in your reps head, it is not going to get said.

 You would be better served reevaluating and reshuffling the offerings occupying the prime space, page 1 above the fold, in your Account Managers head.  From my experience a better quality and quantity of sale will result.

 As an added bonus, develop clear concise messages for you defined offerings to keep the sales team “on message” and ad libs to a minimum.  Develop policies and procedures on the backend to clarify how your operations and services units will execute and deliver on the products and promises your Account Managers are pushing out the door.

 Final thought.  The next time a vendor talks to you about adding product remember to consider your sales teams mental product line up.  To give mindshare to a new product you have to be comfortable with the fact that an existing offering will lose some traction or be eliminated.

Fill those minds wisely.

A man trying to go more than two directions at once is not moving at all.

image courtesy of http://www.worth1000.com