One of the most intimidating conversations to have in the sales process is about money.
Whether you are the founder, sales leader, or sales consultant, discussing prices with large B2B prospective clients can be daunting.
When I asked sales teams why they are afraid or hesitant to talk about money, the answer I get is that they are afraid of losing the opportunity and it might not progress.
or
“oh, that sounds pushy!"
The reality is that you won't lose anything because you have not won the deal.
Second, you are a professional sales person. This is a value exchange.
You need to shift your mindset.
Your biggest resource is your time.
You don't want to spend your valuable time on opportunities that will not progress and win.
Developing a clear strategy and approach can help you build trust with your prospects and close more deals. In this week's newsletter,
I will teach you how to have pricing conversations with confidence so that you can move your sales conversations forward and close more deals.
When should you start talking about price/budget/money in the sales process?
As early as the qualifying stage.
There are 3 things you need to qualify.
Opportunity or Project
Resources
Decision Making Process
Let's focus on “Resources” in this week's newsletter.
You have qualified the opportunity or project and you now have a clear understanding of the problems they want to solve or the results they want, and the impact of working with you has been quantified, like a transformation or services to be delivered.
Start talking about the price or money or budget.
Ask the following questions:
Have you thought about what level of investment is appropriate for the results we have discussed?
Have you built and approved a business case?
Have you established a budget?
Now your client will say any of the following:
No, we don't have a budget. That's why you need to give me a proposal.
Money's not a problem. Just give me a proposal.
I can't tell you. It's on RFP.
I don't know.
⚠️Did I tell you to never ever give a proposal without having a number to work with from the client?
Okay, so what do you do?
Use the 3 Part response for Pricing Question.
Part 1: I don't know how much this will cost you. Every client situation is unique.
Part 2: However, other companies in similar situations successfully achieving the results we've been talking about, tend to invest between X and Y.
Part 3: Can you see yourself falling in this range?
If they say yes, that sounds about right in our range. Then spend your precious time writing your offer and presenting a proposal.
💡HOT TIP
(DO NOT EVER EMAIL A PROPOSAL. You need to present in person and more of that in the coming newsletters).
If they say NO that's too much!
You need to understand if it's a logistics issue or a value issue.
If it's a logistics issue, they are committed to working with you and achieving the results they will achieve but do not have the necessary funds approved.
Large corporations typically have budgets allocated for the year. If they lack the budget for a particular project within that year, you can work on spreading out payments.
Approval processes also vary based on the amount. For example, a manager may be able to approve up to 5 million, but anything over that requires approval from the Vice President. It's important to understand this and work on a solution with your prospective client accordingly.
If it's a value issue, then you have a belief issue with your prospective client.
Client does not believe in the value of your solution
You can ask: I believe the results you want are achievable. I don't think it's possible for this amount of investment. What do you think we should do?
If they say just submit the proposal, you can say what would be the next steps if we submit the proposal when we know it does not fit your budget?
This will allow you to have an open conversation and work together. They might want a demo first or trial. The important thing here is to get MICRO-COMMITMENTS to work together.
Do not believe what it will do for them.
More often, this is not about you or your solution.
Sometimes the prospective clients do not have buy-in at the management level "yet" and need to do a bit of research before getting approvals. The most important thing here for you is to understand what stage the opportunity is so you can have a robust sales forecast and also help your prospective client in the early stage of the opportunity with your eyes open.
Salespeople get stuck when the opportunity has not been qualified at the early stage. Often thinking that submitting a proposal means that the opportunity is real.
Believe they can get it elsewhere for less
If your prospective client believes they can get it somewhere else for less, you need to understand exactly what they are proposing. Is it apples to apples?
You can say "That's great you can get the same results with less investment. I respect that. The only way you could get burned is if you were not really comparing the same scope of work or results."
I am willing to spend half an hour with you to go to the proposal together. You don't even have to show me the names, etc., but making sure you have the right solution and will be making an informed decision. You might still go with them, and I'll only point out if there are differences. How does that sound?
Our intent is to get a solution that exactly meets the client's needs, and it is impossible to do that when we don't have an understanding of where they are in their resources, and we end up guessing!
⚠️Don't submit a proposal without qualifying the client on their time, people, and budget.
Especially budget (money)!
The key to navigating the price conversation with confidence is to start talking about it as early as the qualifying stage, qualify the client on their time, people, and budget, and use the three-part response for pricing questions.
💜I would love to learn a little about you and understand where you are in your B2B sales journey. Could you take just 2 seconds to select the statement that best describes you?
The link will take you to a thank-you page to confirm that I've received your response. This will also help me provide you with resources that fit your needs and my best content.😊
Thank you for reading and I appreciate your time!
Ren