How do I get my PO in faster?
Posted by Geoff Alexander on Mon, Nov 02, 2009 @ 01:15 AM
In addition to writing my weekly blog posts on telesales training topics, I monitor a few other blogs in which sales questions arise. A few weeks ago, the following question popped up about getting POs in faster. We're closing in on year-end now, so I think it's topical to repeat the question in today's post, as well as my answer. Have a look:
Question: What methods do you use to put a time limit on a quote without exposing yourself to pressure? Let's say it is two weeks before the end of the quarter. You want to get a sale before the end of the quarter. What methods do you find effective to get the PO in the time you need it? I find that discounting does not contribute to that and that I am not able to back up from the discount even after the time limit. In other words, the discount is gone forever, even if the Purchase Order was not submitted on time. Please assume the customer is ready to decide, that is all other conditions for the purchase are already met.
(Geoff's answer) "You did the right thing by not further lowering the price. But you have to determine how the prospect perceives that your solution will either help him or her make money, or stop losing money. 99% of the time, companies buy for these reasons. This is always best done early in the sales process, but you can still do it now. Call the prospect and ask, and then try to quantify it. For example, let's say the prospect tells you that she will be using your solution to get her product to market faster. You can then ask how much faster she perceives your product will get it to market. Once you find that out, ask how much revenue is projected for that product in the next 12 months. Once you get that figure, divide by 52 (weeks), and you will know how much his or her company is losing based on lost opportunity costs, per week. Then you can tell her that for each week the decision is delayed, his or her company will be losing that much money. Those are real numbers, based on what she just told you, and you've given her a compelling reason to get the PO to you now. In addition, you'll have given her a good, financially sound argument she may have to take to her CFO. I've probably got a dozen examples of how to build an ROI model like this, but this one's one of the most common (for more on "Selling by ROI," read my whitepaper).
"This technique works equally well if your target company is building an external project (for use by their customers) or an internal project (for use by themselves). Ultimately, people buy solutions because they make financial sense, and sometimes the finances are based on projections. But you do have to ask what their thoughts are as to how the implementation of your solution will pass muster on both the technology and the financial sides of the fence. It sounds like you've won the technology battle. Now you've got to tackle the financial element."
(Back in the present again) The technique of drilling down on the financial reasons people perceive a need for your solution is critical to accelerating the sales process, and it's most effective when you're early in the sales cycle (I encourage you to do it on the very first call) because the prospect is not yet in price negotiation mode, and much of the time will be fairly comfortable giving you some hard numbers. Add this technique to your Best Practices Playbook, and you'll be getting those POs in a lot faster, and with less resistance.