One of my first experiences with selling cars came early in my marriage when we decided to sell our Dodge van. The vehicle was in great shape, no major problems, and well taken care of. I listed it in the newspaper, and a few days later received a call from a potential buyer. He was a business owner, running a restaurant, and thought he might be able to use this van for his work. After driving the van, he agreed it was in good shape, but then started complaining about modifications he would have to make before this van would really meet his need.
There’s an old Proverb that says, “It is good for nothing, cries the buyer. But when he has gone his way, he boasts”.
In this case, the buyer gives hope that the sale is done, but then starts picking apart the product in an effort to bring the price down. My car buyer had me believing I had made the sale. Once he saw me mentally counting the money, he knew he had me. Instead of paying me, he was looking for sympathy, adding up the costs of modifying the product to meet his needs. In the end, I gave in and sold him the vehicle for much less than it was worth. I felt taken once he left, and I am sure he was boasting on the way home. I see this in business today. Buyers will waver back and forth, moaning about changes or features that aren’t just right, looking for sympathy and price cuts. The seller then feels bad and caves in. Even the best sellers are taken by these tactics when the buyer plays his part well.
The Counter Strategy
1. First, it’s important that you know what your product is worth. I knew the blue book values of my van…so I had this one covered.
2. Don’t try to shoe-horn your product or service into situations where it isn’t really a good fit. In my case, I was not doing this – it was the buyer who called me, yet I do see sales people trying to make their expensive products play in the SMB, while smaller companies accept projects that they are just unqualified to do. In both cases, the pricing is often inconsistent with the real value of the project.
3. Don’t mark your close probability at 100% until the deal is done. When I get a verbal commitment, it’s 90% – if an economic buyer gives the verbal. A verbal from an IT person, representing a new client, should be considered 20%. In the case of my van, I was thinking 100% when he said he liked it. I became emotionally involved in the transaction and gave into his tactics. Looking back I realize this buyer was a shrewd businessman. He knew what he was doing.
4. Stand firm. If the buyer starts whining, go back to success stories, or offer to provide additional consulting with additional fees. Nothing really works out of the box in the IT world, so assume there is work to be done. If he can’t afford it, offer some less expensive options. Chances are he is just working you on price.
© 2011, David Stelzl