Understanding More About
Repeat & Referral
The top sales technique for acquiring new business is not through your sales force. Yes, you heard right. The best method for new business comes through referrals from your existing customers.
There is no faster, stronger or better way to build a business than through referral of new customers. In fact, if youre not doing referral selling, youre losing 25 percent of your potential business.
Why is the referral so valuable? Here are a few reasons:
Referrals come from people we already know
We shorten the cycle of familiarity by simply working with someone who knows someone we know. Common ground already exists through a friendship, acquaintance or business relationship. This eases the pressure on the initial getting-to-know steps of selling.
Referrals extend the network
We widen the circle of relationships with each new referral, thereby increasing our ability to tap that network for additional business, new business and additional referrals.
Referrals reduce sales expense
We reduce not only time but expense by asking for and following up with referrals. In our experience it costs 6 times more to sell a new prospect than it does to sell a referral. Think about it. A sales force is full of expenses for a business; customers are very inexpensive, since we already own them.imilar to their own. This can blind the manager to "red flags" about the candidate.
Referrals add value to the source of the referral
When we follow up on the referral, get the business and create a delighted customer, value is delivered to the party who gave the referral. The referral source is credited and often thanked by our new customer. Many industries emphasize value by offering credits for those who refer new business.
Referrals help you use your best sales force
Happy customers constitute our strongest sales force because word of mouth is the single most effective form of advertising. Product or service claims we make often require proof sources for credibility in the eyes of a prospect. Claims from existing customers carry instant credibility and seldom require additional information.
(This is why unhappy customers can be such a detriment, because their claims of poor product or service performance are likewise seldom questioned.)
The trust bond in action
When we ask for and get a referral from an existing customer or business associate, theres more than simple familiarity working in our favor. Were tapping into strong, existing relationships, which can and do accelerate our ability to obtain new business.
We know that trust is a strong basis for the buying decision. In typical selling situations, trust is the first and foremost issue in the mind of our prospects. "How do I know I can trust this person and this company," the prospect asks himself/herself. We work hard and invest in the proper look of printed materials, show the right testimonials, ask good questions and listen closely to the answers, all for the sake of trust.
Brian Tracy, one of the top sales training professionals in the world, cites building the trust bond as the critical first step in the selling process. He says building trust with customers is 40 percent of the process, followed by uncovering needs, presenting solutions and asking for the decision. The value of the referral in this sense is simple.
Trust bonds already exist between you and the customer and between the customer and the referral. The referral process instantly creates a level of trust between you and the referral, a great advantage for starting the selling process.
Where to look for referrals
Periodically we see help wanted ads for sales professionals that guarantee no cold call selling. Organizations can make this claim honestly when they teach their people how to obtain referrals from their own warm market of family, friends and business associates. Sales professionals can then ask for referrals from every prospect and customer as part of their sales conversation.
So where can we find the best referrals? Here are a few places to look:
* Customers: This is obvious in the sense that most referrals come from delighted customers. It is mentioned here because we often fail to ask long-standing clients or customers on a regular basis, such as monthly. When they love us enough to continue doing business with us, its very likely that they can and will continue to send us new referrals for additional business. When these customers mention to the referral how beneficial weve been to them, the referral is much more strongly predisposed to do business with us as well.
* Friends: Our circle of friends can be a tremendous source of referral business. Because of this, its important that our close friends know what we do and how we add value to our existing customers. When our friends also understand our ideal customer or client profile, theyre better able to look around for prospective referrals for us.
* Non-customers: Its often overlooked, but people who arent currently doing business with us can often provide valuable referrals as well. An example comes from the work weve done with wireless communications companies. Often a prospect is currently under contract with a competitor for wireless services and would pay a hefty penalty to terminate before the expiration date. When this same prospect is a disgruntled customer of that competitor and intends to switch his/her service upon expiration of the current agreement, the prospect is often happy to refer business, if only to steer it away from the prospects current provider.
* Suppliers: Strong relationships with suppliers can result in great referral business. This is particularly true when a supplier offers unrelated services to the same types of organizations as we do. For example, you would want to ask your accountant, your printer and your banker for referrals when your primary focus is other businesses.
* Family members: This is a red flag for many of us who have sworn not to mix business with family. Nonetheless, those of us who have benefited from referrals through family know the value of asking politely and following up promptly.
Obtaining the referral
As mentioned above, people we already know, both inside and outside of our business relationships, can provide us valuable referrals. These people arent likely, however, to be seeking us out daily to give us the names and phone numbers of qualified prospects. So how do we get them? We need to ask for them! Oversimplified? Yes, and yet there are certain approaches proven to be very effective in asking for the referral.
How we ask for referrals is a key point in the process. Consider this approach: "Do you know anyone who can benefit from our services?" In this situation, we give the referral source a choice between yes and no. This gives us approximately a 50/50 chance that the answer will be no.
Lets increase the odds in our favor. First, we need to help our referral source by starting the thought process on his/her behalf. Next, we need to move from the yes/no choice to a choice between yeses. Compare this more specific approach: "Which businesses in your office complex could benefit from our services?" Or, "Who among your neighbors would benefit from the special package youve chosen?" By being more specific, weve both helped the referral source focus on a single area and increased our chances of getting a name or two.
In working with delighted customers, try this approach: "Much of our new business comes from people such as you who are already doing business with us. Who among your friends elsewhere in the industry could benefit from similar results?" This reinforces the value we add to our current customer and opens the door for referral opportunities with non-competing organizations. This can be particularly valuable when our customer or client views our work with him/her as a competitive advantage.
Contacting the referral
Critical factors in following up on referrals are timeliness and the initial contact. Timeliness is important because the referral source often tells the referral that his/her name has been passed along to us. The more time that passes between that communication and our follow up, the colder that opportunity can become. The reason is that a long time between the two events might be interpreted as us not caring much about this new business opportunity or as our own lack of organization, both of which can be detrimental to our chances with the referral. First impressions are lasting, so we need to follow up quickly and professionally to make the most of the referral opportunity.
An example of this timeliness occurred recently in a client organization when one sales professional in an inbound call center asked every caller for referrals. As each call ended, he immediately placed an outbound call to the referral and mentioned the just-completed conversation. Using this simple method, he recorded the best monthly sales figure in the companys history and earned an unprecedented commission check.
Equally as important as the timing is our approach in the initial contact. Often were unsure of the level of relationship between our referral source and the referral. To compensate for this lack of information, we need to make our approach as strong and effective as possible.
With very little planning or forethought, we might say, "Joe Jones said I should call you." This puts the burden of detective work on the referral and could start things off in less than ideal fashion. In fact, the referral is likely to start asking us questions, which is exactly the opposite of how we want this conversation to begin.
Try this approach: "Joe Jones asked me to call you and I promised I would." In this day and age, anyone who follows through on promises gets high marks. As a result, we put a much more positive light on the conversation to follow. This allows us to move directly into setting an appointment, qualifying or asking good questions to get key information on the prospects situation or needs.
Consider this bit of wisdom, "The more you give thanks for, the more you have to give thanks for." This especially holds true for those who provide referrals to us. To show our appreciation and to keep the pipeline full of future referrals, we should always follow up with those who refer us business. A handwritten thank you note, periodic reports of how the new relationship is proceeding and similar contacts all provide positive reinforcement to those who refer business to us.
This follow up also emphasizes the win for our referral source. As mentioned earlier, some companies offer financial incentives for referrals that turn into new business. The win in this situation is obvious. Even more valuable for the referral source are the positive feelings from the referral as he/she begins to benefit from what we provide. "Thanks for thinking of us" is a typical response in this situation, strengthening the relationship between the referral and the referral source.
Getting more referral business
Here are some final tips for getting more referral business:
* Look at everyone you meet as a potential source of referrals. Casual or business in nature, any of your existing relationships can generate referral business.
* Hold a referrals game for your sales team. Put an additional incentive on referral business gained during a specified period. Have individual as well as team rewards for hitting certain numbers of referred business.
* Coach your people on steps to getting more referrals. Once they get the hang of it, theyll want to do more and more asking for referrals and less cold calling. Youll both be better off for it.
* Lead by example. Ask your own network of customers, friends and suppliers for qualified referral prospects. Follow up on them yourself or hand them off to team members who can see how quick and easy it is to pursue and close referral business.
Referrals will get you 10 times the profitability at less than 1/5 the cost of other methods of selling. None of us does it as well as we should. Whats stopping you from increasing your referral business?
The 20 Habits of the Top 20%
By Mike Brooks
Youve all heard about the 80/20 rule. Eighty percent of the sales are usually made by the top 20% of the producers. In your company Im sure you can identify the top 20% (maybe youre in that group), but can you identify the skills, strategies and techniques they use to get there? I have coached thousands of inside sales reps over the years, and below I have listed 20 habits the top 20% consistently do that elevate their performance to that top 20% group. If you are looking for ways to improve your sales, then compare yourself or your sales team to the list below and see how many things you are doing, or could be doing, to move you into the top 20%.
1) The top 20% have made a commitment to learning and using proven skills, techniques and strategies to make sure they are the best at what they do. They refuse to ad-lib their way through their careers, and they would never ad-lib their way through qualifying or closing a sale. They know that other professionals, like a doctor, would never ad-lib their way through surgery, and they know that diagnosing a clients needs and then administering the proper solution requires just as much skill. Because of this, they are committed to constantly improving by using and perfecting their sales skills and techniques.
2) The top 20% are the best listeners in the office. They know the value of asking questions and the importance of listening to and allowing their prospects to tell them how to sell them. They listen 3 times more than they talk. Because of this, the top 20% know exactly what their prospects unique buying motives are, and they know what their potential objections are. Their ability to fully listen to their prospect is what separates them from the other 80% of their competition.
3) The top 20% are focused on their clients needs and desires, more so than on themselves. They project an attitude of solving rather than selling. They concentrate on offering their clients complete solutions to their problems. They are constantly looking to offer more than just the product or service, and they often call their clients with new solutions and other ideas that will help them. This going beyond the sale ensures a better relationship and future sales.
4) The top 20% always know their numbers. They keep track of how many calls they make in a day, how many contacts, and how many closes. They know the relationship between these numbers, and they use this information to measure their performance and improvement. Knowing their numbers allows them to know how much each cold call is worth, how much each close is worth, what the best time of day for contacts is and much more. By focusing on their numbers, they are focused on their success.
5) The top 20% record and listen to their calls. They know that the best way to improve is to listen to andcritique their calls with their manager or supervisor. By doing this they are able to zero in on the areas that need to be improved, and they can then implement more effective skills and techniques. Constantly recording and listening to your calls is perhaps the fastest way to improve and move into the top 20%.
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6) The top 20% protect their attitude. They know that positive results follow a positive attitude, and they are constantly feeding and guarding theirs. Most of all, their self talk is positive and encouraging. When they make a mistake, they dont beat themselves up, rather, they commit to doing better on the next call. That wasnt like me, and On this next call, Im going to improve on that, is the self-talk of the top 20%.
7) The top 20% are organized and prepared in advance before they get on the phone. They have learned everything they can about their prospect, their prospects needs and even possible objections. They research their current client notes, they look at their clients website, and they do everything they can to be successful before they ever pick up the phone.
8) The top 20% are also some of the hardest working sales reps in the industry. They are often the first ones at the office and on the phones, and they usually have already logged in calls or even closed deals before the rest of the team even shows up. They are almost never at the coffee machine or in the kitchen talking and wasting time during valuable phone hours, and they almost never take hour lunches away from the office. They are jealous with their time and would rather spend any downtime doing research or preparing for their next close.
9) The top 20% also set time aside at the end of the day to fully prepare for their next day. They prioritize their closes, they prepare their leads, do their research, and are organized and ready to make the most of their next day. By preparing in advance, they are able to begin visualizing positive results the night before. When they come the next day, they arent driven by voice mails, emails and faxes. Rather, they follow their success plan and make the most of their time.
10) The top 20% stay on top of their industry and learn all they can about their product or service. They continuously read industry newsletters to learn about their clients needs, wants and desires, and they incorporate this information in their presentations to make them more valuable to their clients and to become more successful in their careers.
11) The top 20% also know about their competition and understand who and what they are selling against. They research their competitors, send in requests for information or coupons, and they let reps from other companies pitch them. They learn from their competitors and are never surprised by other quotes or competitive offers.
12) The top 20% are constantly learning and implementing new techniques. They listen to tapes and CDs on sales techniques and strategies, and they apply what they learn and adjust this to fit their product or sales presentation. Each week they commit to trying one new skill or technique and they use that technique each and everyday for that week. They are always improving.
13) The top 20% subscribe and constantly receive tips, techniques, newsletters and emails from the top sales trainers in the industry. They know they dont have to reinvent the wheel and they are open to what others have found to be successful.
14) The top 20% are constantly improving their voice, their speech, and the delivery of their pitch. They understand how important their phone presence is, and through recording themselves and by concentrating on the pacing, the tone, the timing and the delivery of their pitch, they are constantly improving.
15) The top 20% spend more time qualifying their prospects then they do closing them. They understand that the sale is made by finding out what the clients needs are and by finding out what the client wants to avoid. They know that by asking the right questions and listening to the responses, they will have all the information they will need to close a sale. But they know it starts on the front endduring the qualifying step.
16) The top 20% are prepared in advance for the objections they get over and over again. They do this by making a list of the top 3 to 5 objections they get all the time and then by writing and using scripts to handle these objections. They know their prospects have scripts so they do, too. The top 20% are prepared with proven scripts which enable them to listen more effectively to what their clients real objections are because they arent busy trying to think up what they should say next. They can truly listen and respond to their clients real needs and objections.
17) The top 20% always question and isolate an objection before they answer it. While 80% of sales reps will immediately respond to an objection, the top reps know that the first objection can often be a smokescreen covering the real objection. They will use proven techniques to question and isolate an objection before they answer it. A top 20% favorite is, (Prospect) if the (objection or concern) wasnt an issue, is this a solution that would work for you?
18) The top 20% know how to build instant rapport. If they sense that a gatekeeper or prospect is annoyed or in a rush, they address it rather than just trying to download their pitch. They use scripted responses like, It sounds like Im not the first person to call you today, or Do you get a lot of these kinds of calls? or You probably get a lot of these kinds of calls, dont you? This immediately breaks the ice and separates them from the other 80% who are trying to get through.
19) The top 20% arent afraid of nos. In fact, they expect and are prepared for them. They understand that not everyone they speak with will buy from them, so they have developed ways to make every call successful. If they cant get a lead or sale on a particular call, they find a way to develop a relationship and either become the next in line vendor, or get a referral.
20) Lastly, the top 20% build their business faster than the other 80% by asking for and working referrals. They ask each and every person they speak with for a referraleven the ones that dont buy! They understand the value of their calls, and they are committed to maximizing their time on the phone. Are you?
The Default Choice
How to become the Sales Rep Your Customers Can't Live Without
by Joe Calloway
If you were to list categories and say to me, Quick, give me a name! it would go something like this:
Advertising agency: Engel Creative-Theyre the only ad agency Ive used for 20 years.
Computer services: Bytes of Knowledge-My computer crashes. They fix it. Period.
Martini: Any martini made by Stephanie at Mirror-She is the Martini Goddess.
Pen: Flair-My workhorse writing instrument. I cant quit em.
Breakfast: The PancakePantry. Go there and youll understand.
Newspaper: The NewYork Times-I sometimes read three or four newspapers a day. If I could read only one, this would be it.
You get the idea. In each of those product categories, I have a default choice. These companies have become indispensable to me. I cant live without them. Well, okay, thats an exaggeration. I can live without them, I suppose, but I dont want to.
By the way, in the interest of full disclosure, Stephanie the Martini Goddess is the bartender at Mirror, where Im a partner. If she ever goes to work at another bar, Ill probably follow her, have a martini there, then go back to my own restaurant for dinner. Shes that good. And make no mistake about it, its not really the martini. Its Stephanie. Her customers like her martinis, but they love her. Thats not just my opinion, either. The Nashville Scenes 2004 Best of Nashville readers poll voted Stephanie second place in the Best Bartender category. Second? Personally, I think she was robbed.
Go through your own personal list of Quick, give me a name! choices in a variety of product or service categories, then look for threads. What do they all have in common? What do they do that you should be doing? Whats your version of the particular strength or advantage that they have developed? This, by the way, is where most people get stuck. They dont have the creative vision required to look at a business that is totally different from theirs and see what the transferable lessons are. Pity. They lose.
Price Plummets in Importance
One of the greatest advantages achieved by attaining indispensable status is that price plummets in importance as a factor in the decision-making process. Looking at my list of default choices, I know that when I have a new marketing program to launch, I have total and complete tunnel vision. I call Todd Engel at Engel Creative and turn the job over to him. Todd works his magic, and I pay the bill. I cant remember the last time that price was a consideration. I may ask what his ballpark estimate is on a project, but its purely for informational purposes, not really as part of the decision. If he thinks its worth the money, I say go.
Master of One
What Engel Creative, Bytes of Knowledge, and most other indispensable companies have in common is that they are masters of one thing. They know their turf; thats what they focus on; and to their customers they have become a category of one. The age-old, time-tested approach to success through focus requires answering three basic questions:
1. What do we do best?
2. What do we love to do?
3. What do our customers value?
How do those three factors match up? Where do they intersect?
A classic mistake in business is to go after more customers by expanding your product or service offerings too far. This can be a great move, but its a little like thinking outside the box. Sometimes I have to advise my clients that before they start to think outside the box, theyd better take care of whats inside the box. In other words, innovation is great, but dont spend money, time, and energy on innovation if you havent first mastered the basics.
Do You Love It?
After answering the question What do we do best? move on to What do we love to do? The answer may surprise you. Many companies find their breakthrough to becoming indispensable through a realignment of what they love to do with what they are good at doing. That can sometimes mean some painful letting go of whats bringing in revenue, but not bringing in personal satisfaction. Its a long-term strategy; continuing to do what you dont love will ultimately result in failure on some level.
Being the default choice and becoming indispensable to your customers means, ultimately, being famous. Not to everyone. Just to your customers and potential customers. Rarely is this kind of marketplace fame achieved by doing anything particularly exotic. Its achieved by doing something that may be considered quite ordinary, but doing it extraordinarily well. Be famous because you never forget what you can do.
7 Essential Qualities of Leadership
"Every excellent organization bears the stamp of its original leaders," says Raymond Yeh, author of The Art of Business. "This small group of leaders mentored a larger group of leaders that, in turn, creates a whole organization of leaders. Great leaders translate an inspiring original vision into synchronized daily executions that make a marked difference in the world." The essential qualities of leadership are:
Values: All great leaders are defined by their character in terms of how well they uphold their values, such as integrity. No organization led by people who fail to talk and act according to ethical values can survive. The disastrous results of leaders failing to walk the talk have been abundantly demonstrated by corporate fiascos such as Enron, Arthur Andersen and WorldCom.
Dream: Great leaders create dreams that galvanize people into action. Real leaders subjugate their personal desires to a compelling vision or higher purpose with the aim of making a difference. That urge to improve, enhance, revolutionize, and better the world is what separates the great leaders from the average. A higher purpose establishes a collective identity so that people's passions are unleashed, and the organization achieves many multiples of performance when compared to the average organization.
Commitment: Leaders commit totally to their causes. Total commitment means they must persevere despite the sometimes overwhelming odds against them. Three necessary ingredients for preservation are forbearance, self-discipline, and courage. Leaders are highly competitive. Self-discipline, therefore, is a necessary foundation for their eventual success. Self-discipline provides consistency in a leader's behavior.
Excellence: Great leaders strive for excellence in their quest for mastery. As they let go of the perception of fear, they achieve confidence. John Wooden is a shining example of unwavering confidence. His confidence is based on the concentration and effort he puts into preparation, not the outcome. Such leaders have a bias for action.
Vulnerability: Leaders have a sense of vulnerability, knowing they need other people to help in achieving their dream. Great people, however, do not always start out great. They need to be nurtured and guided. To cultivate covenant relationships, leaders must communicate. Communication means listening as well as talking, to resolve issues and inform people.
Humility: When leaders truly let go, reflection becomes a natural habit, as they tend to look at the whole picture rather than just themselves. Reflection helps one to look at the whole picture and assess: What's happening? What's not happening? What can I do to influence the outcome? This kind of reflection provides insight into the big picture necessary for clarity to juggle long-term priorities and short-term emergencies. More important, such clarity allows leaders to maintain poise under pressure.
Peace of Mind: Leaders have a deep sense of satisfaction about what they have done to make a difference in the world. They have gained the peace of mind that comes from knowing that when their best was called upon, they delivered. They flow into their destiny with certainty and have the patience not to force their will on their environment. They have a heightened awareness of their own being.
The Power of Why
Everyone (particularly business coaches like me) talks about goal setting, and so it is surprising that surveys indicate 97 percent of businesspeople do not set them. Of the people that do set them, 97 percent set reactive goals, two percent set proactive goals, and one percent set intention-oriented goals. Guess which ones create the biggest results?
Most people don't set goals because they have tried and failed. They set goals to fix today's problems for a better tomorrow. They didn't ask the question: "Why do I want to achieve this goal?" If they had, their goal would have been different, achievable, and achieved.
A friend of mine said she wanted to lose 10 pounds. Now, there's a goal designed for failure. I asked her why. She said so she could fit into her clothes again. Fitting into her clothes again-not losing the weight-is the goal.
You may have been taught to set SMART goals: Specific, Measurable, Achievable, Realistic, and Trackable. These are proactive goals, like growing your income by 10 percent over last year. Again, the question "why" is unanswered. And as a result, another goal is unfulfilled.
Let's get to intention-oriented goals. These are the goals I want you to set. These goals are visionary, have a purpose, and look beyond the incremental steps. These goals say: "This is where I intend to be at some point in the future."
Instead of growing your income 10 percent, let's discover why you want the extra money. Perhaps it would allow you to take a three-week trip to Belize or to pay for long-neglected guitar lessons or to help your daughter buy her first home. Those goals are not about the money, they are about what the money will allow you to do. These are intention-oriented goals. You may not know right now how you are going to get there, but you know where you want to end up.
Now, you're going to set up a priority system to help achieve these goals. This priority system (a "to-do" list on steroids) is based on two questions:
1. What is the best use of my time right now?
2. Will this activity help me achieve one of my goals?
Activities unrelated to your goals need to be delegated, delayed, or eliminated from your list.
Activities that will help you achieve your goals now can be divided into "A" and "B" categories. You should set your "B" list first. Ask, "Can I postpone taking action on this activity?" If the answer is "No," then the activity automatically is on the "A" priority list. If the answer is "Yes," you must ask three more questions to determine if it becomes a "B."
1. Is this an activity that leads to the accomplishment of a goal?
2. Is this a commitment or a promise?
3. Is this a vital, critical, life-threatening "must do"?
A "Yes" to any of these questions and the item goes on the "A" list.
Finally, you rank your "A's" and "B's" one through ten. If you have more than ten, you need to find something else to eliminate or delegate. Now, attack the "A's."
Once you make this system a habit, your "to-do" list becomes shorter, and you'll be more effective. And you'll be on your way to achieving your goals-not just crossing things off your list. It's all possible; you just have to answer "why?"
The Fifteen Rules Every Sales Negotiator Must Know
Peter Barron Stark
To be a truly great salesperson, you need to be excellent in sales negotiations. Negotiation is a process that can be learned. By following the 15 rules outlined here and with practice, practice, practice you can perfect your skills and negotiate deals where everyone wins.
1. Remember, everything is negotiable. Dont narrow a negotiation down to just one issue. The most common deal point that sales negotiations focus on is price. Our price is too high, are words that members of the management team hear over and over again. Price is never the sole determinant in a negotiation. If price were the sole determinant, then we would all be driving YUGOs and the car would still be sold in America. If you and the other party lock onto one issue, develop as many issues or negotiable deal points as you can and then juggle in additional deal points. For example, if price is a sticking point, instead of lowering your price, juggle variables such as quantity, model, delivery dates, terms, etc.
2. Crystallize your vision of the outcome. Vision is a fancy word for a clear mental picture of the outcome. A great analogy is the box top of a jigsaw puzzle. You already know what the puzzle looks like before you ever start the assembly project. The counterpart who can visualize the end result will most likely be the one who guides the negotiation. Can you see yourself overcoming all the buyers objections and putting together a sales package that your prospect is excited about buying? The counterpart who has the vision in this sales relationship is the counterpart who will drive the outcome.
3. Prepare in advance. Information is power. Many salespeople look at their calendar each morning and begin their preparation on the way to the appointment or worse yet, in their clients lobby. Obtain as much information as possible beforehand to make sure you understand the value of what you are negotiating. Remember, very few negotiations begin when the counterparts arrive at the table.
4. Ask questions. The best sales negotiators understand that there are two types of questions and know when it is appropriate to use each type. To be successful, ask open-ended questions when you are trying to build the relationship with your buyer or gain as much information as possible. Ask closed ended questions when you are trying to gain a concession from your buyer or confirm a deal point. Great questions help you to determine the implicit and explicit needs of your counterpart.
5. Listen. When you do a good job listening, you not only gain new ideas for creating win/win outcomes but you also make your buyer feel cared for and valued. This allows you to find out what the other party wants. If you assume that the buyers wants and needs are the same as yours, you will have the attitude that only one of you can win the negotiation. Great salespeople recognize that buyers trust you a whole lot more when they are doing the talking.
6. Set a goal for each deal point. Every salesperson has had someone in management ask, On the ABC account, why did you lower our price or give in on a specific deal point? In other words, management was asking you, What were you thinking? On every negotiable issue, you should define your 1) point of comfortability or goal; 2) your wish or higher level of aspiration; and 3) your bottom line that you are unwilling to cross or your defined minimum level of acceptance for each goal. If you have identified these three points on every negotiable issue, and are willing to juggle issues to keep the deal balanced, we are confident you will minimize the number of these management discussions in your career.
7. Aim your aspirations high. Your aspirations will likely be the single most important factor in determining the outcome of the negotiation. You can aim high just as easily as you can aim low. Focus your aspirations high on creating maximum value for your buyers. With a focus on your value, it will take the emphasis off of the price side of the price/value teeter-totter.
8. Develop options and strategies. Successful salespeople are those who have the greatest number of viable alternatives. Similarly, successful negotiators are those who have the most strategies they can use to turn their options into reality. When a buyer tells you no or gives you another objection, it means that the existing configuration on the table will not work. Thats no problem, youll have three other strategies or options that will ensure this sale will be successful.
9. Think like a dolphin. The dolphin is the only mammal that can swim in a sea of sharks or in a sea of carp. Dolphins are able to adapt their strategies and behaviors to their counterparts. There are salespeople in every company who get eaten alive by shark-like clients. There are also salespeople in every company who do exceptionally well swimming with shark-like clients. Remember, when a shark- like client takes a bite out of you or your company, the deal just changed and most likely, needs to be restructured to remain fair and balanced. Carp-like sales people are afraid to rebalance the deal for fear of losing the client. This further erodes the clients respect for the salesperson. Even when negotiating with a shark, you have an option you can walk away!
10. Be honest and fair. In life, what goes around comes around. The goal in creating win/win outcomes is to have both counterparts feel their needs and goals have been met, so they will be willing to come back to the table and negotiate again. An atmosphere of trust reduces the time required to create win/win outcomes. Salespeople who plan on having a career in the business of selling know that long-term, trust is the most important characteristic they bring to the table with a client. To be personable and liked is important, but there are many salespeople who are liked but not trusted. When there is no trust, usually there is no sale.
11. Never accept the clients first offer. Often, the buyer will make an offer that he or she thinks you will refuse just to see how firm you are on key issues. In our seminars, salespeople often ask, But if the buyer agrees to our price, wouldnt you say yes to the first offer? If the price is perfect, then counter small with the terms. For example, you might respond, That price will work but you will have to take delivery by the 31st of the month. Will that still work? If you do not counter anything, the client will not think they received the best possible deal.
12. Deal from strength. For salespeople, confidence can mean the difference between making and losing the sale. Sales build confidence. Preparation builds confidence. Options build confidence. Maximizing value builds confidence. A positive vision of the successful sale builds confidence. The bottom line is that buyers make less demands from salespeople who have confidence.
13. Concede slowly, and call a concession a concession. Giving in too easily tells the other party that you will probably be open to accepting even more concessions. One of the most common buyer tactics is to ask for a concession in price. One of the most common sales concessions is to split the buyers request in half. There are two important points here. One, as a salesperson, you dont ever want to be the one to offer to split the difference. If there is a $1000 difference between you and your buyer, offering to split the difference or meet in the middle does two bad things. First, it is a large concession, not a small one. Second, any adept buyer will offer to split the split. The buyer will say, You have just told me you are willing to sell this product or service for $500.00 less. Now, we are only $500.00 apart. If you could come down another $250.00, I know I could get approval to make this deal work. The bottom line is you just moved with a three-quarter concession. The buyer only moved with a one-quarter concession. You would have been better off to come back in the first round with a small concession like, I discussed this with our management team, and the lowest possible price reduction we can give is $112.86. Two things will work in your favor. You conceded small and you gave them a weird price. Weird prices are negotiated less often than round numbers. Thats a fact!
14. Be cooperative and friendly. Avoid being abrasive or combative, which often breaks down negotiations. Salespeople who become abrasive or combative lack confidence which creates situations where they say things they will later regret. Confidence gives you the power to be cooperative, friendly and keep you mouth shut even in the most difficult situations. And in those difficult situations when you need to open your mouth, the confident sales people will ask a great question that allows the buyer to discover the point the sales person is trying to make.
15. Be grateful, be thankful and be appreciative. Buyers are people. Most people have a deep implicit need to be appreciated. With every buyer, no matter how small the sale, make sure the buyer feels appreciated. The best way to make the buyer feel appreciated to tell them you are grateful for their business and genuinely thank them.