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Photo taken by David Stelzl

For some reason, discussing money is the major hurdle.  Yesterday I had several sales calls with potential buyers.  One example stands out… We had discussed the need, talked about options, come to a conclusion on next steps, and even picked dates to begin.  My prospect then said, “Send me a proposal with some options and pricing.”

I was tempted to agree, but then that little voice reminded me of Mahan Kalsa’s book, Let’s Get Real or Let’s Not Play (which I highly recommend). Why would we wait for the proposal to agree on options and pricing.  Paper doesn’t sell, I do.  We have verbal agreement on the vision, but no specifics.  Why waste time and possibly ruin the opportunity by putting the wrong thing down on paper?

Instead I simply said, “Let’s review some options right now and make sure we are in agreement on how to proceed.”  I verbally gave him my interpretation of what we were planning to do, offered a couple of options, restated the value, and then offered a fixed fee.  I then said, “How does that sound to you?”  He said, “That sounds great.”  Now I can write the proposal, which is now really an agreement, with confidence.  I converted it to a PDF, attached it to an email, and wrote, “Here is exactly what we agreed to.”  The likelihood of closing this kind of agreement is much higher than the elusive agreements made in most sales meetings.  Meetings end without any real commitment, and the request for proposal is often just a polite way of ending the meeting.  There is no agreement, and there are no specifics from which to craft the proposal.  In the end, this type of proposal goes nowhere, leaving the sales person to forecast at 50%.  In other words, I have no idea…

© 2011, David Stelzl

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Photo by David Stelzl

The purpose of a sales presentation is to sell; to convince the prospect that you have a solution to a problem that they in fact have, and that you are the best problem solver around.  The fee in turn, must be commensurate with the value delivered.

But here’s the problem:  First, 95% of the possible prospects in your territory don’t necessarily agree that they have a problem – or at least have a problem that you specialize in solving.  Second, most presentations are informational, offering no compelling value.  They are not centered on solving a known problem.   The other 5% of the people out there admit they have a problem, but have no reason to believe your solution is any better than the next guy.   In this case you lack differentiation.

Since most presentations look pretty much the same, the client’s propensity is to continue doing business with the known quantity unless in incumbent’s price is severely undercut.   Don’t overestimate your brand or uniqueness based on things everyone has, or at least say they have.  Start treating your presentation as a commercial, or perhaps an infomercial.  Put more time into making a great presentation and you’ll waste less time on unqualified meetings.

© 2011, David Stelzl

Photo by David Stelzl

No matter how much value you represent, and no matter how well you communicate it, you will find that some prospects/clients, just can’t afford you.  In this economy, expect that number to grow within your current client base.  So what do  you do?

Move on!  But remember, every past client, every prospect, and those struggling to pay their bills right now, represent spokespeople for your company; expect them to pass on their experiences working with you.   So a couple of points are key here:

1. First, don’t be afraid to lose customers.  If it’s the economy, no problem, there are more customers out there.  On the other hand, if you have a service problem, fix it.  Over time, customers come and go, and hopefully your value grows (along with fees); while their business may be shrinking.

2. If they can’t afford you, you can’t afford them.  Don’t compromise to win a client that will continually struggle to make payment.  In the end, you lose, even if its just from the stress of waiting on payments.

3. Be prepared to refer them to a less expensive solution.  You want everyone you talk to, to perceive you as helpful, and wish they could do business with you.  One day they may be in a position to hire you, right now they are in a position to recommend you.  So keep a list of quality partners that target lower end markets.

4. Finally, don’t let your clients get behind in payments.  Extending credit may seem like you are doing them a favor, but you’re not.  Debt creates bondage… it adds stress to the relationship.

With this in mind, plan your solution strategy for 2011 based on the market you intend to serve.  Put brackets around the low and high end of your target, and serve them well.  Refer business to partners  that falls outside of your parameters, and charge for the value you deliver in your circle.  This is good business.

© 2010, David Stelzl